Half-term report

Now that we are staring into the back-end of 2017, I’ve dug out my 2017 predictions to see how I’m doing so far.

As expected by everyone, the affiliate consolidation has continued apace with up to seven major affiliate groups making bids on assets in all markets. For now I expect this trend to continue and predict that we are at least three years away before the acquirers hit peak acquisition. I still expect to see some affiliate mega-mergers but believe ‘integration’ of such large portfolios of assets and people will prove problematic for even the most technically savvy.

My strong buy rating on 32Red was on-point with the Unibet acquisition deal going through, I’m still long on Gaming Realms with their level of product and brand innovation as well as just getting the basics right.

As expected, nothing much has happened with DFS outside of the core US market and with the recent knock-back on the merger between DraftKings and FanDuel, they will now need to defend heavily the US cash cow and I expect to see them pulling back on non-US activity heavily.

Esports betting is continuing to maintain triple-digit growth and I expect to see this continue as the leagues and teams keep going along the professionalism curve. We are definitely watching the growth of a major new sports category and I believe esports is stealing eyeballs from Premier League football in the UK.

Looking slightly wider into the world of CFDs and binary options, with the clampdown by the regulators in the UK and more importantly Cyprus, this part of the industry is in turmoil. I expect to see a lot of these firms going bust and the small number of top players consolidating the market.

Tech watch
From a tech perspective, as predicted at least one operator will be live with a chatbot and, bang on schedule, Paddy Power has launched its own bot. Due to the relative ease of deployment and the use of third parties for the tech, I’d expect to see a few more live by the end of the year and for the sophistication and accuracy to improve significantly.

“So far in 2017 the industry has been largely predictable which means that the second half of the years is bound to throw up a huge amount of surprises”

VR is still a niche product but we can see the content and hardware maturing quickly, maybe this Christmas someone will launch the ‘must-have’ present that rapidly accelerates getting devices into households.

My bullishness on the Apple Watch is still unabated with version three due to be launched early 2018. Apple is making a big pivot to the watch as a health and fitness tracker which, when combined with the app ecosystem, builds on the ‘monitored self’ trend. This I believe, from a consumer perspective, opens the watch up to a wider audience and creates a huge category for Apple.

Sticking to Apple, the App Store search ads have launched and are quickly having a big impact on marketing budgets and acquisition numbers. Google finally will begin to allow gambling apps in the Play Store which has caused much rejoicing not just among operators but my guess also
with Facebook.

Building on my Bitcoin predictions and the rapid user adoption I’m seeing, I predict that one Bitcoin-focused operator will make it onto the EGR Power 50 in 2018.

So far in 2017 the industry has been largely predictable which means that the second half of the year is bound to throw up a huge amount of surprises.

Managing partner of consultancy firm Revenue Engineers, Costello’s previous roles include senior industry head at Google and leading the online marketing departments of PokerStars and Paddy Power.