The hierarchy of sports betting sites is experiencing some upheaval at the top.
That is because more and more data is pointing to a changing of the guard when it comes to the mobile side of legal sports betting market share in the United States.
Namely, it looks like DraftKings has seized, or is getting closer to seizing, the top spot from FanDuel, which has long been the leader among U.S. online sports betting operators.
DraftKings has typically run second in the rankings, but numbers recently reported by state regulators show DraftKings claiming the top spot, or at least coming within arm’s reach. The Massachusetts Gaming Commission announced recently that DraftKings was responsible for more than half of the state's online sports betting handle in September, as the Boston-based operator took $290.1 million in wagers out of a combined $499.7 million.
To date, the Commonwealth has collected approximately $60.26 million in total taxes and assessments from the sports wagering operations of licensed operators since sports wagering began in person on January 31, 2023 and online on March 10, 2023.
— MA Gaming Commission (@MassGamingComm) October 16, 2023
MORE: https://t.co/IQW61ntg56 pic.twitter.com/vNK2Tux7rg
It’s not just in its home state that DraftKings is seeing the numbers trend its way. In New Jersey, DraftKings generated more sports wagering revenue in September than any other operator, with nearly $50 million in receipts. FanDuel had long held the pole position in the Garden State.
Investment bank JMP reported this week that FanDuel generated around 39% of gross gaming revenue from U.S. online sports betting in August, down from 42% in July, while DraftKings clocked in with 34% in August, up from 32% in July. FanDuel may have gained back some ground last month, however.
“Initial September data has FanDuel increasing market share ~600 [basis points month-over-month] to 46%, led by strong New York results, while DraftKings is in the number two position, increasing marginally MoM,” JMP Securities analyst Jordan Bender wrote in a note to clients.
Where the rubber hits the road
While it may seem like a bit of inside baseball, the battle atop the digital wagering leaderboard has implications for the everyday bettor, as DraftKings and FanDuel try to outdo each other in what they offer customers.
Why DraftKings is gaining ground is likely due to a few factors. DraftKings CEO Jason Robins said in August that they felt their online sportsbook would be the best around in the second half of 2023, noting enhancements to its same-game parlays and live-wagering options. In addition to a better product, DraftKings may have ratcheted up its promotional spending a bit, as analysts from investment bank Jefferies noted on Sunday that DK issued the most free bet credits in Maryland in September, at $8.8 million.
DraftKings has made gains in online gambling more broadly following its acquisition of Golden Nugget Online Gaming Inc. in 2022. Analysts at Eilers & Krejcik Gaming recently said DraftKings notched an approximately 31% share of the U.S. online gambling market for the first time in August, which means both online sports betting and internet casino gambling, edging out FanDuel at around 30%.
Breaking away from the pack
DraftKings and FanDuel have also pulled away from the rest of the online sportsbook operators by a good deal. The two titans are in a commanding position, and during a vitally important time of year for bookmakers, the football season, which could force other operators to up their game or get pushed even further aside.
JMP reported there were around 547,000 U.S. app downloads during Week 6 of the NFL season from operators controlling 95% of the online sports betting market, up 33% from a year earlier. FanDuel was responsible for 32% of those downloads, while DraftKings accounted for 30%. The next-closest operator was BetMGM, with 16% of the download market share in Week 6.
“Stepping back from the two leaders jockeying for the top podium position, the combined 83% market share is now the highest between the two companies in history as brand and product are clearly outpacing the competition heading into the seasonally most important stretch of the year,” Bender wrote.
Incoming!
Nevertheless, the DraftKings-FanDuel duopoly may face a significant challenge in the coming months. Fanatics Sportsbook is establishing itself in the wagering market, and ESPN Bet is expected to launch in November.
Analysts at investment bank Jefferies said this week in a note to clients that FanDuel leads sportsbook operators in its Google Search interest, web traffic visits, and web page visit durations. DraftKings, meanwhile, was the leader in app downloads.
“We continue to highlight the positive correlations between market share performance at DKNG and FanDuel, as they remain top operators across most categories in our index, as well as in GGR,” the Jefferies analysts wrote. “We note that BetMGM market share has been declining recently, most recently evidenced by the drop in rankings, losing to Bet365 in earlier August.”
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