PointsBet, NBC Extend Accord, Eye More Regional Focus
Posted on: January 30, 2023, 05:20h.
Last updated on: January 31, 2023, 03:03h.
PointsBet (OTC:PBTHF) and NBCUniversal are adding two years to a previously announced five-year sports betting partnership. The broadcast giant is promising to help the sportsbook operator more effectively target its advertising spending.
PointsBet USA CEO Johnny Aitken told Axios the two sides are adding two years to a five-year, $500 million agreement struck in August 2020. Under the terms of the original pact, NBC Universal received the rights to acquire 4.9% of PointsBet shares, with an option to gain 25% of the Australian bookmaker’s equity over five years.
PointsBet became the official sports betting partner of all NBC sports properties, including NBCSN, the Golf Channel, and regional sports networks (RSNs). However, BetMGM recently replaced PointsBet as the official sportsbook sponsor of NBC’s Sunday Night Football.
NBC is a unit of Comcast (NASDAQ:CMCSA).
New Deal Could Benefit PointsBet, NBC
With NBC holding rights to potentially own as much as a quarter of PointsBet shares, which have slumped mightily for more than a year, it behooves the media company to help the gaming firm hone its advertising expenditures.
Under the terms of the extended agreement, PointsBet will be required to spend $58 million annually on ads on various NBC properties, down from the originally agreed-upon $90 million per year spend. Those savings could prove material for an operator of PointsBet’s stature because the company hasn’t realized profitability in the US – something some of its rivals are closing in on.
To help PointsBet more effectively target ad spending, there’s likely to be a new focus on NBC’s regional sports networks (RSNs).
NBC is the megaphone for sports in some our most important regional markets such as Chicago and Philadelphia, where they broadcast three teams (NBA, NHL and MLB) in each city across a 12-month calendar,” Aitken told Axios.
PointsBet is currently live in 14 states, with Massachusetts slated to soon join that list. NBC Sports operates eight regional sports networks (RSN) across the US. Those markets include Boston, Chicago, New York, Philadelphia, and Washington, DC — all of which permit mobile sports wagering or soon will in the case of Boston. NBC also has RSNs covering California, the San Francisco Bay Area, and the Pacific Northwest.
It’s possible that if the objective is to help PointsBet gain more benefit from its advertising dollar, the operator’s ads won’t be featured prominently in California and Washington State because mobile sports betting isn’t allowed in the jurisdictions.
Potentially Pivotal for PointsBet
While PointsBet reduced its NFL advertising spending, the company’s 2022 US losses expanded, and the company came under fire for poor execution in the world’s fastest-growing sports wagering market. To that end, the revised pact with NBCUniversal could prove pivotal for the operator’s efforts to right its US ship.
The revised deal will make it easier for PointsBet to be more efficient with its marketing obligations, which is critical as the online sports book operator strives for profitability,” according to Axios.
The Australian company delivers fourth-quarter results on Tuesday, Jan. 31.
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