Major US sportsbooks could lose “tens of millions of dollars” in revenue due to extended downtime during sporting events, according to a data analysis by sports odds information company BetterMetrics.
A pause is when a sportsbook periodically stops betting lines on a sporting event and re-adjusts the odds based on activity within the event (baskets, touchdowns, goals, penalties, significant injuries, etc.).
According to the findings, FanDuel has the greatest potential revenue loss of the top three sportsbooks, with an average outage rate of 15.8% per game (84.2% load rate), leaving it with an estimated loss of $1.45 billion.
DraftKings is best in class, but has an industry-leading outage rate of 4.8% (95.2% uptime), leaving $249 million in potential volume. This analysis was conducted utilizing NBA betting data for the 2023-2024 season.
“Pauses are an inevitable part of sports betting as traders inevitably evaluate the risks associated with new in-game conditions, but some sportsbooks are systematically more cautious than others. This nuance in the situation is causing more sportsbooks to focus on the risks rather than the potential benefits of improving their average uptime,” said Robert Irwin, CEO and co-founder of BetterMetrics.
“Looking at the NBA data from the top three US sportsbooks gives a clear picture of each book’s trading desk’s stop strategy and risk management perspective. FanDuel has the potential to lose the most revenue due to its incredible volume, but with some optimizations it could significantly increase its margins and widen the gap on DraftKings, the decisive US leader.”
According to Bettormetrics, each sportsbook handles suspensions differently and for different lengths of time. Depending on how long the odds are suspended, the sportsbook may lose the opportunity to accept new bets and may lose active users to other sportsbooks if the odds are suspended for an extended period of time.
“All operators are looking for ways to increase profit margins, increase betting volumes and reduce customer churn. While many sportsbooks will be focused on user acquisition costs, the suspension will help sportsbooks drive new revenue from within by becoming more efficient than their competitors,” said Sabine Brooks, commercial director at Bettormetrics.
“In the US, market share is gained by a very small percentage. By understanding and addressing these important trading efficiencies, sportsbooks have the potential to recoup billions of dollars in lost revenue. An improper suspension strategy is just very bad business for customers and shareholders alike.”
