The impact of Unibet’s planned closure in 2024 on Arizona sports betting.
The latest Arizona sports betting operator to announce its closure, both within the state and nationwide, is Kindred Group’s Unibet brand.
Kindred Group executives announced during an earnings call this week that they will be gradually exiting the American sports betting market by phasing out their Unibet operations. The company plans to either sell the brand or its assets by the end of the second quarter in 2024.
For the second time this year, an Arizona betting app operator has announced their closure, with WynnBET Arizona being the first to make such a decision earlier in the year.
According to some sports betting and business experts who spoke to yengols.com, the recent closure of the state’s sportsbook was not surprising. They noted that Unibet had faced challenges in gaining market share and achieving success in the states where it was operating.
According to Daniel McIntosh, a teaching associate professor at Arizona State University, the fact that Unibet had a small handle of $15,639,186 (or .127% of the state’s total handle) over 25 months played a role in their choice to exit the American market, as reported by yengols.com.
McIntosh stated that the Arizona Department of Gaming’s most recent revenue report for September revealed that Unibet held less than 0.1% of the market share, with less than $600,000 out of a total handle of over $600 million. After accounting for payouts to winning bets, Unibet’s net revenue from wagering was estimated to be around $34,000. This indicates that their market share may not be sustainable and could potentially not cover their expenses. However, it is important to note that this assessment is speculative.
What will occur with Unibet’s partner in Arizona?
Charles Montague, CEO of Paradise Casino and Quechuan Casino Resort, stated during a conversation with yengols.com on Thursday that the tribe is prepared to seek out a new online sports betting partner to replace Unibet Arizona.
Montague was not taken aback by Kindred Group’s decision to exit the American market, drawing parallels to past choices made by slot machine operators.
Montague has confirmed that they are actively seeking a new online sports betting partner following the departure of Unibet in the second quarter. They are currently in discussions with other vendors to fill this role. While this change will require finding a new vendor for sports wagering, it is not expected to significantly impact their physical operations.
Montague mentioned that the tribe will have to reach an agreement with Kindred Group regarding the outstanding payments from their online sports betting partnership. Nevertheless, he reassured that he does not expect the tribe to lose their betting license because of the planned closure.
Montague clarified that they are in the final stages of securing a deal for online sports betting, which is a similar process to sourcing new vendors for slot machines. The only remaining step is to either modify an existing agreement or establish a new one with a vendor who is eager to join or already active in the market. The key now is to identify a vendor who is both available and enthusiastic about participating in the industry.
In August, Bet365 Arizona received an online license from the Arizona Department of Gaming through a partnership with the Ak-Chin Indian Community. The license, originally held by Fubo Sportsbook in collaboration with the Ak-Chin tribe, was transferred to Bet365 following the closure of Fubo Sportsbook last year.
The Arizona Department of Gaming has acknowledged the recent announcement by Kindred Group and confirmed that they are working together to address the situation and gather information. At this time, the Department does not have any further details to provide.
There may be additional consolidation on the horizon.
Experienced industry professionals such as McIntosh see the shutdown of Unibet as the latest example of consolidation within a contracting industry, where the top four sports betting companies are gaining greater control over the market.
McIntosh believes that the Arizona market is ready for a shakeout. Even if Unibet tries to sell off their assets, it is unlikely that there will be a strong market for them to enter, as DraftKings, FanDuel, BetMGM, and Caesars continue to dominate.
Montague and his team are optimistic about the future of sports betting with the Fort Yuma Quechuan Indian Tribe, as their retail sportsbook at Yuma’s Paradise Casino continues to draw customers from both sides of the Colorado River. Furthermore, online wagering has proven to be a lucrative opportunity for the tribe.
Montague noted that the collaboration with Unibet for online sports betting has been highly successful, but the expansion of traditional sports betting at Paradise Casino has surpassed all expectations.
Montague stated that the tribe is considering expanding the sportsbook lounge at Paradise Casino in response to the growing demand since the launch of Arizona sports betting in 2021. The planned expansion at the Yuma facility will feature additional seating, betting kiosks, and televisions.
Montague exclaimed, “Our business is flourishing! Customers frequently approach me to express their satisfaction with our offerings as they pass by every day. It’s clear that our establishment has been warmly embraced by the community.”
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Author
Peterson Christopher, with over seven years of experience covering sports and sports betting in Arizona, has now assumed the position of lead writer at yengols.com. He has held previous roles at ArizonaSports.com, the Tucson Weekly, and the Green Valley News.
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