Fox recently obtained a $236 million stake in Stars Group to launch a gambling platform by the end of 2019. The company now holds a 4.99% stake in Bet Stars with an option of buying 50% of its US operations in the next 10 years.
As a result of the new partnership, the Stars Group will be launching a new sports wagering platform called Fox Bet. The deal is the largest investment a media company has made in the sports betting industry till date after PASPA was struck down in May 2018. The company is owned by Rupert Murdoch and his family.
Stars Group is a Toronto based company that operates a New Jersey sportsbook and the Pokerstars brand. It entered the sports betting space after buying Sky Betting and Gaming for $4.7 billion last year. As soon as the news went public, share prices of Star Group went up by 11%. Their share price is already up by 6% this year.
The new Fox Bet platform is expected to launch in 2019 and will offer two different products to the users. The first product will be completely free to play and people who successfully predict the outcome of sporting events will be rewarded. The second product will be a full-fledged sportsbook and will be launched in states where sports betting has been legalized. The free-to-play platform will help in bringing new customers and eventually turn them into paying customers for the second platform.
Stars Group will also get access to some of Fox Sports trademarks for 25 years. It has agreed to spend some money on advertising on various Fox Sports networks. Fox has been given the option to buy 50% of the Bet Stars’ US operations in the next decade. The growing influence of legalized gambling could prove to be profitable to Fox. Online gambling is expected to grow as a $9 billion per year market by 2025 with significant revenues from bets, sponsorships, and advertising.
As Fox is a media company, is better positioned to design a content strategy that could bring the Fox Bet platform to the mainstream. As Bet Stars is an experienced sportsbook operator, they have found a dependable partner for the new venture. Bet Stars could look forward to implementing their successful strategies from Europe. The platform piggybacked off established brands and emphasized heavily on technology to gain an edge. Sky Bet, for instance, is one of the largest sports betting operators in the UK and has a huge active player base.