I know what you’ll be doing this Sunday.
Well, I have a very good idea anyway.
Because if it’s the same thing as the rest of the nation — and much of the world — you’ll be watching the Super Bowl.
If you want to talk about dominant market share, Super Bowls are far and away the most watched television shows in history. In fact, 29 of the 30 most-watched TV broadcasts ever — 97%! — are Super Bowls. (The lone exception is the final show of M*A*S*H in 1983.)
To put some numbers on that, nearly 110 million people in the U.S. have watched the last 10 Super Bowls on average. That’s one-third of the entire population.
It’s no wonder then that advertisers pony up about $5.5 million for just 30 seconds of your time. That’s $660 million an hour — even more than Jeff Bezos makes!
Those are all massive numbers, but they are not growing. The two most recent Super Bowls had the lowest number of viewers in the last decade.
This year will be a bit unusual with the pandemic going on, but I expect those viewership numbers to grow again in the coming years because of another emerging industry that’s about to hit hypergrowth.
The American Gaming Association estimates that about $6.8 billion was wagered on last year’s Super Bowl.
And here’s where it gets interesting … only $300 million of that was legal.
I’ll do the math for you. Just 4% of last year’s bets were placed legally.
This suggests two things. A staggering amount of money still needs to shift from being bet illegally to being bet legally. And well over $7 billion in bets will likely be placed on this year’s Super Bowl.
It all goes back to 2018 when a Supreme Court decision left it up to individual states whether to make betting legal. It didn’t take long for many to head down the road to legalization, and today sports betting is legal in some form in 20 states and Washington, D.C.
Areas where betting is legal now cover 120 million people, more than one-third of the country’s population. That’s up 70% from last year, when only 14 states with 70 million people offered legal sports betting.
Growth accelerated even during the pandemic as legalization spread and several technological innovations converged.
We have the rollout of 5G high-speed wireless internet. We have artificial intelligence (AI) used more and more to gather and disseminate information. We have the Internet of Things (IoT) — in which just about everything will be connected — that seamlessly joins the plays on the field with the statistician in the box to those of us watching at home.
An increasing number of bets will be placed online through the ease and convenience of mobile devices. Morgan Stanley expects that by 2025, more than 75% of sports gambling revenue will come from bets placed online. To put this into perspective, only about 13% of revenue is from online bets today.
You can see the huge growth potential.
In addition, the number and kinds of bets are surging as well, thanks once again to the technological convergence undergirding this trend. It’s much more than betting whether the Kansas City Chiefs or Tampa Bay Bucs win the Super Bowl. There are now almost limitless possibilities.
Just consider “prop bets,” which is short for proposition bets. They are very specific. Here are just some of the prop bets you can place for Sunday’s Super Bowl:
- Will either team score in the first five minutes?
- Will the first offensive play of the game be a run or a pass?
- Will Patrick Mahomes throw an interception?
- Will there be a successful fourth-down conversion?
- Will the game go into overtime?
That’s just a small list of what’s available.
We should reach the point in the future where pretty much every adult in the country will have the ability to legally wager on sports. Research firm Macquarie believes that in the next five years, 96% of all adults will have access to sports gambling.
Thanks to the reliability and speed of 5G, much of it will be right at their fingertips.
Growth is in its early stages, especially when you factor in other trends like iGaming and eSports, but investors are starting to take notice. Check out Penn National Gaming (NASDAQ:PENN) since its lows last March … up more than 2,500%!
As technology converges with legalization, sports betting is entering hypergrowth territory. This trend is now too powerful and too big to overlook. That’s why I just unveiled our new iGaming/eSports Portfolio in Investment Opportunities, including two new recommendations in great position to make money.
I hope you enjoy the game on Sunday. And as an investor, I hope you enjoy what’s to come.
On the date of publication, Matthew McCall did not have (either directly or indirectly) any positions in the securities mentioned in this article.
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