An underlying narrative from William Hill’s departure of the Australian market this week, was that the operator is readying itself to expand its US footprint should the US Court overturn the PASPA act this year.
Since 2012 William Hill has had betting outlets in Nevada, however since the possibility of legal sports betting grew in New Jersey, the group has explored the possibility of expansion to Monmouth Park.
Furthermore having first entered the Australian market in 2013 William Hill has announced that is has agreed to dispose of William Hill Australia to Crownbet. A deal that the group’s Chief Executive Officer, Philip Bowcock emphasised would allow them “to focus on continuing to grow our UK Online and US businesses, particularly as we prepare for the decision on the PASPA appeal due in 2018.”
Don Best Sports supplies odds and data services for North American sports, the group’s Managing Director Benjie Cherniak spoke to SBC about William Hill’s decision and whether it emphasises how much focus the operator is putting on the American market.
Cherniak stated: “I think this decision is in some part based on William Hill’s desire to focus on the US market, albeit in reality they have been preparing for US expansion for a number of years now, led by William Hill CEO Joe Asher and his capable team. In fact, one can surmise that William Hill’s entry into the US six years ago, while in part based on the Nevada opportunity, was in larger part to position themselves for the eventuality of legislation and US expansion, which at the time seemed light years away but now appears to be right around the corner.
“The other factor in play here is that William Hill clearly struggled in Australia from day one. There are a preponderance of reasons for their inability to turn the corner in Oz but that is a story for another day. Would William Hill be turning their backs on Australia if they were achieving great success in said market? Highly doubtful. But given their struggles in Oz, and given the opportunity the US represents, the timing is opportune to exit at this juncture, as they now have.”
Further looking ahead to the just how competitive the market could be should it open up, he added: “We are really early in the game but it is clear that the US market will be both massively competitive and highly challenging. Competition will come in various forms, as each State will have its own legislation and its own operators, making it difficult to establish a national strategy.
“Not only does an operator need to consider its competitors from state to state, but they also have to adjust to varying tax rates, laws, and potentially sharing revenues with professional sports leagues in select jurisdictions. Not to mention the at least initially the grey market remains active, adding a less defined layer of competition to the mix. It will be interesting to see which operators are flexible enough to adapt to these challenges and realities.
“William Hill, as mentioned above, have been preparing for legislation for years, and appear to be well positioned to navigate the landscape. Interestingly, Crown buying out William Hill Australia and in turn selling 80% of shares to Stars Group may play into the US story as well. Stars already has US operations, and with Crown on board, Stars is now seemingly better positioned to formulate a US strategy then they were previously.
“It may turn out that the entity William Hill sold to in Australia eventually emerges directly or indirectly as a competitor to William Hill in the US market. It will be fascinating to see how all the above plays out in the years ahead,” concluded Cherniak.