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888 aims for close integration with Sports Illustrated

25th June 2021 9:57 am GMT
Playtech

888’s long-held US ambitions might finally be receiving the turbo boost that they have needed for the best part of a decade.

“We finally signed the deal that we have been hinting at for the last few months,” 888 chief executive officer Itai Pazner tells us on the morning he can proudly announce the company’s new partnership with Sports Illustrated.

The deal has been a long time coming. While the likes of BetMGM, FanDuel, DraftKings and Rush Street Interactive have spread their wings across the US, 888 has remained slightly stuck in the nest.

This will have been hugely frustrating for 888’s US chief Yaniv Sherman, because 888 has been a trailblazer in the US market. It was one of the first companies to link up with Caesars - operating its UK-facing website back in 2009 and opening its WSOP poker site in New Jersey and Nevada, when regulations first allowed it in 2013. It was the first - and remains the only - company to operate an interstate poker network across Delaware, Nevada and New Jersey.

However, New Jersey’s initial progress from 2013 was a slow-burn, while Nevada failed to get out of poker-only first gear. While the likes of Golden Nugget Online Gaming and Rush Street Interactive would eventually use New Jersey as a springboard towards independent Nasdaq listings, 888 remained curiously stationery.

Then came the post-Paspa big bang. Long-time ally Caesars looked elsewhere for a helping hand with sports betting. And while 888 eventually acquired its own sportsbook, it still failed to sign the deal that would fulfill ambitions that three consecutive chief executives had been talking about for the past decade.

But a deal has been done and Sherman can be congratulated for potentially pulling in a bit of a doozy. (Ed: local slang meaning something outstanding or unique.)

Sports Illustrated has a slight whiff of old world, pre-digital days about it. It is renowned for its magazine (its paper magazine sold in newsagents - remember them?) and its once-a-year swimsuit issue, which to many will seem as antiquated as UK newspaper The Sun’s page three girls.

But while the latter was discontinued in 2015, Sports Illustrated’s swimsuit issue lives on and thrives online with the massively popular Swimsuit.SI.com. The comparison, however, is like comparing apples and oranges. SI Swimsuit is more about glamour, celebrity, fashion and fitness than it is about sex.

But if SI has not quite made the leap into digital that DraftKings and Caesars partner ESPN has achieved so successfully, it is not to be sniffed at. While its 30m monthly unique users is significantly less than ESPN’s 117m, it has committed and engaged customers, who have a high propensity to lay a bet.

Furthermore, Sports Illustrated owner Authentic Brands Group (ABG) has huge plans for digital, of which SI Sportsbook is but one. The key will be the integration between SI’s assets and 888’s betting operations.

Here, the signs are good. This is a joint venture between ABG and 888, which will see ABG invested in its future success. SI Sportsbook will be 888’s sole sports betting brand in the US. Furthermore, a team is being recruited into Sports Illustrated’s New York office, which will comprise members from 888’s marketing, product and trading working alongside SI content makers.

The model for this concept remains Flutter’s Skybet, which was going to be replicated in the US with Foxbet, before Flutter seemingly chose to focus on Fanduel instead. While that partnership seems to have descended into acrimony, the model remains potent. 888’s exclusive deal promises more than the slightly muddy co-exclusive deal that DraftKings and Caesars have with ESPN. If nothing else, 888 has no other fish to fry. This will be its sportsbook product in the US and it needs to make it work.

“Sportsbook has become the main battleground in the US and going into that battle we need the best ammunition we can get,” says Pazner. 

The sports-related brand was missing. Pazner recognises that while 888 is almost a household brand in markets like the UK, it is almost invisible in the US. With that box finally ticked, 888 will export its entire technology stack into the US.

Pazner reckons its cloud-based infrastructure is a first for the US market and will be launching in Pennsylvania with WSOP in the next few weeks. That will be followed by its Orbit, Poker 8 and Spectate Sports software products - all newly revamped and battle-tested in Europe.

The final pillar of the 888 bridge from US obscurity to success will be market access agreements. SI Sportsbook will be launching first in Colorado in time for the NFL kickoff in September. Then it will spread to New Jersey, Iowa and Indiana. It is a modest start, considering some of its competitors are live in a dozen markets and have market access agreements in almost half of the nation’s 50 states.

However, 888’s ambition of opening two to four markets a year is eminently achievable. The SI brand should be much more attractive to local casinos than the 888 brand is on its own.

The modest target also suggests that 888 will be rolling out across the US market with the same attention to detail that has ensured success in Europe’s regulated markets. Since 888 was reborn in 2011, it has not tended to do things until it is sure of success.

888 will also offer SI-branded casino and poker products in US states that allow, benefiting from cross-sell opportunities from its SI Sportsbook and looking to replicate the success of SkyVegas in the UK. While sports betting is often the gateway, we all know that casino games remain the most profitable product. This could be where other ABG brands come in handy; whether that's Marilyn Monroe, Elvis Presley or Shaquille O'Neal.

It is an exciting prospect. This is the big one for 888. It simply has to make it work. Its recent operating history suggests it will do just that.

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