In the competitive landscape of the sports betting industry, the metrics for success are constantly under debate. With opinions divided between handle and revenue as the best measure of market share, the conversation continues to evolve. Massachusetts, with its burgeoning sports betting market, offers a fascinating case study in this ongoing debate, especially when examining the performance of industry leaders like DraftKings and FanDuel.
Handle vs. Revenue: The Great Debate
The distinction between handle and revenue is more than just academic; it shapes how companies strategize and compete. The handle refers to the total amount of money wagered by bettors, while revenue, also known as "gross gaming revenue," is the portion of bets that sportsbooks keep after paying out winners. Some experts argue that handle is the more accurate reflection of a company's market share since it captures the total betting activity. Conversely, others, including FanDuel CFO Paul Edgecliffe-Johnson, argue that revenue provides a more meaningful measure since it directly relates to a company's profitability.
An Insight into Massachusetts' Betting Scene in October
The dynamics in Massachusetts for October reveal a lot about how these two metrics can narrate different aspects of success in the sports betting industry. DraftKings took the lead in both handle and revenue over its closest competitor, FanDuel. DraftKings notched nearly $305 million in handle and $34.3 million in revenue, significantly outpacing FanDuel's $155.6 million in bets and $15.9 million in revenue.
This dominance is noteworthy, particularly in a high-hold month where operators collectively generated $58.2 million in combined revenue. The state benefitted handsomely, collecting $11.6 million in tax revenue for the month, contributing to over $70 million in tax revenue since the beginning of the year.
A Look at Other Contenders
Beyond the titans of DraftKings and FanDuel, other players in the Massachusetts market are carving out their own niches. BetMGM, for instance, recorded the best hold of the month, earning $4.4 million in revenue. Meanwhile, Fanatics and WynnBet, with revenues of $13.6 million and handles of $13.5 million respectively, alongside Barstool Sportsbookâs $13.9 million in handle, show that the competition is healthy and diverse.
Attention also turns to new entrants like ESPN Bet, whose operations will be included in the next report. With ESPN Bet's introduction, the curiosity builds around how it will shake up the existing hierarchy and whether it can challenge Caesars Sportsbook, which held a fourth-place position with $19.1 million in handle.
What Lies Ahead
As Massachusetts and other states continue to develop their sports betting landscapes, the debate between handle and revenue as the primary metric for success isn't likely to subside. However, what remains clear is the significant impact the sports betting industry has on state tax revenues and the competitive dynamics it fosters among leading operators.
The performance of DraftKings and FanDuel in Massachusetts serves as a microcosm of the broader industry competition. It underlines not only the strategies that leading companies deploy to capture market share but also the potential for emerging players to disrupt the current hierarchy. As the industry evolves, so too will the metrics by which success is measured, offering an ever-changing narrative of competition and achievement in the world of sports betting.