The First Step to Legal Sports Betting In Canada…
An Exciting Day For Canadian Sports Bettors…
The vote on Bill C-218 to allow Canadians to take part in single-game wagering passed in the House of Commons by a score of 303–15. The bill now enters the last phase in hearings with the Justice Committee before moving to the senate and then to the Governor-General for Royal Assent. Once the bills are signed, the onus moves to the provinces to decide on how they wish to offer sports betting to residents.
When Will We Be Betting?
The timeline for single-game wagers being placed in Canada remains unclear. The earliest estimates call for June, while more conservative analysis calls for late 2021. With the overwhelming support of the bill, the betting favourite for speculation would be legal single-game betting somewhere in Canada before NFL kickoff in September.
My Quick Thoughts…
Great! Single-game betting could be a reality in Canada soon.
Wait! Is it not already?
As a Canadian that has worked in the sports betting industry for more than a decade, I have lived through an industry split with a parallel line. On one side is access to play at the vast majority of sportsbooks across the globe. On the other side is sports betting inside every large retail business across the country. The problem? The latter is arguably the least competitive and most disadvantageous betting product on the planet. It is the potential for the line to be removed that should be exciting for all bettors.
If you are in the minority of bettors that win long term this will not change anything for you. Frankly, it might just end up infuriating you to see the impending mockery made of the industry you live in while walking down the street. But it is important to remember that the only way there will be legal, long term, viable local products for you to use is for there be an overwhelming demand for one. The only way that demand exists is via oversaturation of poor products. That time will come…eventually. With any luck, a unicorn emerges early. Unfortunately, the millions of non-price sensitive bettors excited just to place a bet and part with their money will be welcomed and serviced first.
If you are in the majority of bettors that play for the fun, excitement and sake of gambling on sports in general, rejoice. Good things will be coming your way. New apps, new options, and eventually retail options for you to bet at will be plentiful (probably). If you like hearing about betting, seeing it discussed on television and entered into everyday conversations, there will be plenty of that too. The offers presented to you will be relentless, and many will provide you with advantages. Accept them, take them all on, but just remember, it is very unlikely that any operator which enters the space will have any interest in your long-term satisfaction.
Much is left to be decided, and I will continue to revisit topics frequently. But here are some of the most pressing questions I am thinking about this afternoon…
Important Questions Left Unanswered…
What happens to Bet365 and Pinnacle?
Canadians can — and always have — been able to bet online and through mobile apps of Bet365 and Pinnacle. Bet365 figures claim more than $4B is risked annually by Canadians with more than 60% of handle generated on in-play wagers. While Pinnacle does not disclose their figures, their high limits and long-standing presence within the country would make up a large portion of the other $6B in the $10B estimated to be risked offshore by Canadians each year.
Unlike the United States where no operators had any market share before the reveal of PASPA, competitors entering the Canadian market will enter short-handed against Bet365, the best betting mobile app and the long-established powerful brand of Pinnacle. From both a customer and operator standpoint, how the government elects to handle both of these companies will tell a lot about what sports betting products will look like from other operators short term in the country.
Will problem gaming be approached from a national or provincial level?
The outlook on problem gaming is currently headed at a provincial level. To say it is handled poorly would be a generous complement. With the introduction and encouragement of new apps, there must be more done to make services available to players. Problem gaming has spiked during the pandemic amid lockdowns and resitrctions to unsustainable levels. It is great to have new options to bet, but problem gaming needs to become a much bigger discussion point in this process.
What happens to the charity model?
Multiple provinces have already expressed interest in allowing operators to enter the country and offer their betting products to residents. However, what terms will new operators be subject to? The reason that Sports Select offers such a non-competitive product to citizens (117% sides/totals with a two-game parlay minimum) is due to the large charity contributions kicked back to communities. In addition to sports betting, casinos, table game revenue, slot machines and video lottery terminals are also subject to the same charity model. The cost to operate will undoubtedly be passed on to the customer, but the charity terms will ultimately dictate how disadvantageous the products are for customers to use.
Do Provinces get first dibs?
The days of filling out proline slips at the gas station before kickoff with tiny golf pencils are dwindling with many provinces developing online websites. Since the pandemic hit and casinos were shut down, provincial gaming websites are setting significant spikes in playthrough. Will provinces ultimately roll out their products initially and leverage the convenience they have established over the past few decades? While it can be easy to look at things through the eyes of a pessimistic professional bettor, the first products offered by any operator will only have the biggest picture in mind. If provinces elect to go first, how competitive will their products be with the aforementioned giants that exist in the country, and those others knocking on the door?
Will we see the first media network-based betting operator in North America?
Telecommunication titans Rogers and Bell have been on sports betting hiring sprees for the past twelve months. Both Rogers and Bell combine for 65% of all wireless usage in Canada. They also own the only Canadian sports television networks (TSN/Sportsnet) in the country. Beyond the capital and resources both companies have at their disposal, controlling the media and the betting medium is a gigantic competitive advantage no other betting operator will have. As someone with a decade of product development experience in the betting world, the idea of betting being offered from the network side out is quite exciting.
Who else could potentially compete?
The top name on this list is without question theScore. The Canadian based company owns the #5 most downloaded sports app in the country and has earned immense user trust for providing live scores and stats. The biggest competitive advantage for theScore beyond their user base is the ability to change the way that users bet on sports. No company (in any market) is better positioned to offer content centric betting fuelled by a community simultaneously intertwined with the attention-grabbing and user retention of live scores. The process and activity of placing a sports bet has been the same for 100 years, but just on different mediums. theScore could change that — but appear to be going the traditional route with a lacklustre feature deprived betting app currently offered in a handful of states.
FansUnite is a Vancouver based company loaded with talented employees. Their biggest advantage is a proprietary iGaming solution which is largely entrenched within the eSports space currently. When it comes to B2B white labelling, FansUnite can be a competitive local offering that will have their hand in shaping how operators look within the country.
The CFL has partnered with DraftKings and Penn National.
DraftKings offers daily fantasy for the league to citizens and has the product offering and reach to compete with large companies that may also enter the space — albeit with their product offering being extremely disadvantageous for all bettors.
Penn National leads the way for any operator potentially entering the space with retail operation experience. While the future of retail betting in Canada is unclear, they are undoubtedly the most equipped to enter this side of the market in the short term.
My wildcard is Covers. The long-established betting community is based in Nova Scotia and has a significant user database in addition to many relationships with operators. While I do not expect the company to become a betting operator, they are in my opinion best positioned to make a splash in supplementary products which exist in every betting region.
