Formula One has announced a sponsorship and data rights partnership with Interregional Sports Group that will enable the development of a live in-race betting platform.
The 5-year deal, worth at least $100 million, gives the sports marketing agency the ability “to sublicense betting partnerships rights around the world”; rights packages that are said to include regionalized on-screen promotion, trackside signage and exposure across Formula 1’s digital and social properties – where of course, the promotion of sports gambling is legal.
Sponsors will not be permitted to offer odds within ads during grands prix races.
The $100 million figure ISG is paying makes “the cost of acquisition per player very high”, leading at least some to believe the company is using F1 as an entree to sports bettors – hoping they’ll be able to entice them gamble on other sports;
I say they’d better be able to, the $100 million fee – which ISG is paying up front – is more than the company’s annual revenue.
…and perhaps the worst sign of news for the company is that the deal comes at a time when the involvement of gaming companies in sport is being more closely scrutinized than ever before; of course, that’s on a global basis, not here in the U.S.
Italy and Australia have already implemented bans on betting advertisements during live sporting events and there’s now talk similar bylaws could be set in the U.K.; F1’s most lucrative broadcast market.
Tom Watson, Deputy Leader of the Labour Party, has called for a ban on all gambling advertisements during live sporting events, calling them “a public health emergency”;
Watson’s plan also calls for a tax on gaming operators, money that would be used to offset a portion of gambling addiction recovery efforts, and a prohibition on the use of credit cards to pay down bets.
One U.K. gaming operator, Sky Bet, is on record supporting the levy, but vehemently opposes a “blanket ban” on advertising and credit card payments saying those initiatives could push gaming companies to drop their UK licenses; a measure that would ultimately leave domestic gamblers vulnerable to “disreputable operators.”
Yeah, good luck selling that. There odds of Sky Bet closing its U.K. division are infinitely long.
If you’re interested in sports business, sign-up for our free daily newsletter at JohnWallStreet.com or find us on Twitter at @HowieLongShort.