Paddy Power Considering Major Move on US Gambling Market
Paddy Power, a major player in the UK/Euro gaming market, is considering a significant expansion of their US-facing operations. It’s a move that acknowledges both the massive potential of online gaming in the US, as well as the competitive nature of the European market.
Paddy Power, like most UK bookmakers, have been riding some turbulent tides when it comes to carving out revenue growth. A new tax scheme that taxes punters based on their location, rather than the location of the server they’re playing on, is just one of many factors making life challenging for operators like Paddy Power.
These factors make doing more business on the other side of the pond an increasingly appealing proposition.
In a interview with Reuters News Agency, Paddy Power CEO Breon Corcoran explained the appeal of a US expansion saying:
I think that market has yet to open up properly. I would hope we could do more there, it’s a question of legislation and opportunity. There is a lot of appetite to do more if the right thing comes up at the right price.
What Paddy Power would really like to do is keep an edge against an increasingly competitive European gaming market that’s chewing up small and mid-size operators – and making revenue growth a real challenge. Corcoran explained the current Euro situation neatly saying:
Scale is the critical word. As online consumption matures and as regulatory and compliance cost go up, I think being large is ever more advantageous. There are very few markets in Europe right now where you’d prefer to be a smaller operator and I think that has long-term consequences for industry structure.
With that in mind, Paddy Power could build on the success of its US-facing horse racing operations and/or expand its footprint in the daily fantasy sports market.
No matter what Paddy Power does in the US, one thing is very clear. Operators that want to stay competitive are looking at markets that aren’t quite as crowded as the current European market.
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