FanDuel and DraftKings Retain Dominance, Oust Competitors

Since the repeal of PASPA six years ago, sports betting expanded across the United States. This expansion helped create a healthy and competitive market. Although there are plenty of licensed operators, the unquestionable leaders remain FanDuel and DraftKings.

The duo, cumulatively held a 73% handle share in April, according to Truist’s expert analyst Barry Jonas, who was recently quoted by Legal Sports Report. In a Tuesday note, the expert highlighted the dominance of the two operators, outlining that throughout 2023, they had a handle share of 72%.

A breakdown of the 73% handle share reported in April shows that FanDuel was in the lead with a 38% share, while DraftKings’ handle share was 36%.

Holding the leadership roles at the helm of the betting sector, FanDuel and DraftKings effectively eliminated the possibility of a “tier two” operators. Jonas explained: “Note that we skipped “tier two” – we don’t think any operator in the space qualifies for that standing with white space between DKNG/FanDuel and others.”

Data disclosed by the Virginia Lottery reaffirmed the dominance of FanDuel for April in the state. The operator emerged as a leader in Virginia after reporting more than 50% of the sports betting revenue for the month.

The Betting Sector Continues to Grow

According to the expert, a handful of operators may fall into a category recognized as “fourth tier.” In this category, he positioned betting operators such as Rush Street Interactive, Fanatics and Bet365. Jonas acknowledged the success of some of those providers on a state level.

On the other hand, the Truist analyst spoke about BetMGM and Caesars, as “tier three” operators that can leverage their customer loyalty programs to gain a competitive advantage. Over the last few years, operators that successfully fuse land-based gambling, mobile betting and loyalty programs enjoyed increased customer engagement.

While there’s no room currently for “tier two” operators, Jonas highlighted the potential growth of ESPN Bet that may help it become the first betting supplier from that category. The expert spoke about ESPN Bet’s performance over the last three months, pointing to its 6% gross handle share.

The operator launched its services late last year. ESPN Bet quickly attracted players with its database now consisting of 3.6 million users. However, the monthly active users are approximately 685,000. Considering that number, it is likely for ESPN Bet to continue growing.