February 28, 2025 • 38 mins
Join hosts Michael Barr, Damian Sassower and Vanessa Perdomo, for a look at some of the latest headlines and stories in the business of sports.
Bloomberg Media Streaming reporter Hannah Miller on Major League Baseball and ESPN ending their broadcast relationship after the 2025 season, three years early from a seven-year deal.
Bloomberg’s Patrick Gillespie on Argentine soccer teams signing top players to million-dollar contracts, in part attributed to Argentina’s President Javier Milei's efforts to slash the government's budget deficit, which has brought stability to the peso and increased purchasing power for Argentines.
Plus, Gambling.com Group CEO Charles Gillespie on the growth of sports gambling in the United States and his company is helping people gain access to various sports betting sites.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News. This is the Business
of sports.
Speaker 2 (00:10):
The business of sports can be intimidating or hard for
a starting to break into.
Speaker 3 (00:14):
We really appreciate when our owners are actually there, you know,
with us through the journey.
Speaker 4 (00:19):
Teams ours especially have been very intentional to diversify at
all levels of the company.
Speaker 5 (00:23):
I think we're in bolden years for the NFL and
college football. Our demographic reach has continued to explode.
Speaker 4 (00:30):
This is going to be really unlocking the streaming platform
for sports fans.
Speaker 6 (00:34):
Sports evaluations arising.
Speaker 2 (00:36):
We'll see when they peak.
Speaker 3 (00:37):
You don't have to be the best in your sports
and make a whole ton of money.
Speaker 1 (00:43):
Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (00:47):
This is the Bloomberg Business of Sports, where we explore
the big money issues in the world of sports. I'm
Michael Barr, along with my colleagues Damian Sasauur and Vanessa Berdomo.
Scarlett Foo would join us later on in the show.
Coming up, we'll talk with the founder and CEO of
Gambling dot Com Group, Charles Gillespie, about the growth of
(01:08):
the sports gaming industry.
Speaker 6 (01:09):
All that pent up demand.
Speaker 3 (01:11):
You know, people that have been waiting to register accounts,
go out and set up their accounts, and then it
quiets down a bit, But then you're going to have,
you know, fifteen twenty thirty years of fairly reliable growth.
Speaker 2 (01:23):
We'll also talk about the big money going into getting
and keeping top Argentine soccer talent in Argentina and what
President Javier Malay has to do with it. All that
and more is on the way on the Bloomberg Business
of Sports. But first we got a couple of big
moves in sports media, and we want to go over
all of that, including ESPN officially moving on from Baseball.
(01:49):
Joining us now to talk about it is Bloomberg News,
Media and Entertainment reporter Hannah Miller. Hannah, welcome to the
Bloomberg Business of Sports.
Speaker 7 (01:58):
Thank you for having me.
Speaker 2 (02:00):
Well well, well, well, well we're back to that old
fight with the regional sports networks and then the ESPN
and all this stuff. So I'm going to start with
ESPN first. ESPN. Now, Now, the way I'm going to
word this is going to sound weird. They're dropping Major
League Baseball, but major League Baseball says, oh no, no, no, no,
(02:23):
we're dropping you. So can you explain what happened.
Speaker 7 (02:28):
Yeah, so MLB is trying to make this seem very mutual.
You know that they came to this decision together, but
we know that there's more tension than that. You know,
MLB has been really trying to expand with its meteorites.
It's struck multiple deals, including with Roku and Apple. And
you know, these deals are a lot cheaper than what
(02:51):
ESPN was paying. I mean, the deal with ESPN was
five hundred and fifty million dollars per year, and they
wanted they wanted a better price than that. So you know,
they've kind of gone tip for tat. You know, MLB
has complained about you know, ESPN not covering baseball enough,
not giving them enough airtime. ESPN has countered with you know,
(03:12):
this is too high of a price to pay, and
they basically you know that this deal ended early. There
was an early opt out for the you know, after
the twenty twenty five season. The deal actually expired in
twenty twenty eight, so this is this is pretty surprising,
but you know, the door is still open. ESPN N
MLB could come together come to some sort of agreement.
(03:35):
So we'll see if that happens.
Speaker 8 (03:37):
And it's interesting for me. You know that the back
and forth is so interesting. You know, why did ESPN
ultimately feel like that they were paying too much?
Speaker 7 (03:45):
Yeah, so I think ESPN was really looking at these
other platforms. You know, they were looking at Roku, they
were looking at Apple, both of whom are trying to
get more and more into support streaming. And you know,
ESPN was like, hey, we want a better deal. We
want to be more in line with what these are
their guys are paying. So it's been very interesting to
see in the context of other you know, sports media rights.
(04:05):
The NBA deal over the summer was a knockout, you know,
record value. I think there is a real question of
whether MLB will be the only major sports league to
see a decline in price sport media rights. But you know,
even though ratings have been good for them, I don't
think they've necessarily had the degree of success that they
were hoping for. You know, in the NBA that it's
(04:28):
just a lot of star power. You know, it's a
game that people describe as more fun to watch. So
these are going to be problems that follow MLB going forward.
Speaker 5 (04:39):
Well, and let's crystallize it for our audience, shall we
I mean the deal, as I understand, it was a
seven year deal that ESPN agreed to pay the league
five hund fifty million a year, thirty regular season games,
including the wildcard playoff round, and I think the home
run Derby. But you know, I think I mean for me,
I mean, and I watch baseball, I mean I never
have to watch on an ESPN beca YUS. It's on Fox,
(05:01):
it's turn it's on Turner, it's on Apple, it's on Peacock.
I mean, is that the reason did Major League Baseball
kind of sell themselves short? Did they thin the rankings
so to speak by offering on so many different platforms?
Speaker 7 (05:14):
Yeah, I think that definitely played a part into it.
You know, MLB has been known for sharing the love.
You know, you can access games on Fox, on Turner,
you know, there are a lot of ways to watch it.
You also, you know, still have some strong regional networks.
I think that definitely kind of diluted things a bit,
just spreading them around to different places.
Speaker 2 (05:35):
Well, here's what I'm confused about, because in the contract,
ESPN was going to air thirty regular season games, the
five hundred million dollar contract. Then, of course the wild
card playoffs, the home run derby, ten spring training games,
but they're saying MLB that THEYD got it did not
(05:55):
get enough baseball coverage? Are they talking about the regular
when you watch daily ESPN reports, that's what they're upset about.
Speaker 7 (06:05):
I think that's a huge part of it. It's just
you know, not getting it focused enough in a lot
of ESPN sports shows and their news coverage. Even the
spring training games is actually up to ten games that
they could have aired, so they didn't even have to
fulfill fill all of that with showing games. So you know,
it's it's definitely I think makes sense in the context
of this battle. You know, like neither side was satisfied
(06:27):
with what was happening.
Speaker 2 (06:28):
Wow, I want to see the home run derby. Now
where am I going to see it?
Speaker 7 (06:32):
Well, that's the question. There's gonna you know, there are
rights up for grabs here, and like I said, they
could come back together, you know, patch things up, have
an agreement where they could get those games back.
Speaker 8 (06:43):
And you think that when they come when they do
get their agreement, that you think it's going to be
a lower value than they would think.
Speaker 7 (06:51):
I think it would. I think that's definitely a strong possibility.
I was talking about that with someone the other day
where it's just like, you know, we've seen just you know,
knockouts for other leagues. You know, we talked about the
NBA before. But yeah, there is a question here that
MLB could be the outlier.
Speaker 5 (07:08):
You know, Hannah, you know I have to ask you
just to switch gears here. I mean this whole restructuring
of Diamond Sports Group I think it's now called main
Street Sports Group, right, and you know, we all know
what happened. They filed for bankruptcy in twenty twenty three,
then they want approval of an Amazon aided restructuring, and
now Diamond I'm sorry, main Street Sports Group is going
(07:30):
to be offering sixteen regional sports networks for twenty dollars
a month in addition to its streaming service. I mean,
how did this happen? How did this company turn it
around so quickly?
Speaker 7 (07:41):
Yeah, they needed a lot of help to turn it around.
So all of this is progressive Amazon helps, Yes, yeah,
this is all part of their bankruptcy restructuring. This is
how they were merging from bankruptcy. So both Amazon and
FanDuel stepped in as white knights here. So Amazon struck
a multi year streaming with Diamond. Diamond has undergone this
(08:02):
rebrand to be main Street Sports Group. You know, they
want to leave Diamond in the past, have a new future.
And any other player here is FanDuel. So this these
regional sports packages, it's going to be marketed under FanDuel
Sports Network and this naming rights agreement that you know,
FanDuel paid for this branding that helped you know, Diamond
(08:24):
slash main Street get out of bankruptcy. So none of
this is a huge surprise, like we've been waiting for
this to happen and get finalized. But yeah, I mean
this is how they were able to get out of
the hole.
Speaker 2 (08:35):
Well wait a minute, Piggy loves going in the sports
draft here, so I want to make sure I got
this right. Amazon. They're going to offer sixteen regional sports networks.
Anyone of the sixteen I can watch is I live
in the Poconos in Pennsylvania, and I could get Miami
if I wanted to and watch that all sixteen are open.
Speaker 7 (08:57):
My understanding is it is based off zip code, so
you will get the regional sports network that's for your area.
So I actually was looking at the website today and
they were like, this is not available in your area,
Like get out, you know, New York, It's not for
New York. So that that's my understanding at least.
Speaker 8 (09:13):
Oh, and it's interesting when we were thinking about that
and thinking about local blackouts and stuff. So one of
the things that happened when Diamond Sports filed for bankruptcy
was the MLB. You know, reports kind of came out
that they were almost it was almost in their favor
for regional sports networks to go away because they wanted
to retain the rights to all of their media rights
(09:35):
so that they could go to national partners and that
would maximize revenue and stop local blackouts. So how does
this all.
Speaker 7 (09:42):
Plan to that?
Speaker 8 (09:43):
This new Amazon deal with main Street And then when
you look at popular regional sports networks, like you said.
Speaker 7 (09:48):
Like with yes, yeah, I mean so Amazon has been
making this push into regional sports streaming and just sports
streaming more broadly, Like this isn't totally shocking. And you know,
this struggle for regional sports network it's a tale as
old as time. You know, people are switching to streaming
their trimming expensive cable packages. Yeah, I think they're hoping
(10:10):
that this is going to make everything more accessible to people.
You know that they will get more coverage. We've even
seen you know, you brought up yes, like they're going
to be Yankees games streaming on Amazon. We just heard
about that, and it's something that you know, it's going
to help these regional sports networks like this is not
(10:30):
easy for them, Like MLB has also been doing deals
with various teams to kind of develop their own regional brand.
But yeah, I mean, I think with looking ahead, we're
just going to see more and more stuff switched from
cable to streaming. This is across the board, not just
in sports. People want to pay less money per month,
(10:51):
they want similar packages, and they want more customization, so
all of this con per month.
Speaker 8 (10:56):
But it's twenty dollars a month on a streaming service
straight up than what you pay for it already, which
is crazy.
Speaker 7 (11:02):
Yeah, no, I mean it's I think they're kind of
going for cord cutters here, like yeah, you're paying twenty
dollars a month for your streaming package, but like maybe
you're not doing that expensive sports cable package that is,
you know, hundreds of dollars a month, Like maybe you're
getting rid of that to kind of get the sports
you want specifically for your area. It's a toss up.
(11:24):
I don't know. I think like these slim sports packages,
that's going to be a trend we're going to continue
to see in twenty twenty five.
Speaker 5 (11:32):
Vanessa, it's the Arizona Diamondbacks we're talking about here. I mean,
shame on you, but no, I mean, seriously, Hannah, my
last question is this. I know that you know diamond
used Chapter sorry, main Street used Chapter eleven protection to
end broadcast deals with a few teams, the Diamondbacks being
one of them. I think the Padres and the Rangers
were a few others. Who do they have agreements left with?
I think I think they had to deal with the Braves,
(11:54):
maybe the Angels. I mean, I mean, do we know
who those six teams are? Sixteen teams are? And I
think what Michael Barr really wants to know. Are the
Tigers one of them?
Speaker 7 (12:03):
Yes, the Tigers are one of them. Yeah, Detroit, La, Miami.
Like they have some big cities that are in the
mix here, so you know there are good offerings like
it's not you know, there are some really high profile
teams included here. So yeah, it's a whole mix, but yeah,
definitely definitely La Miami Air standouts.
Speaker 2 (12:25):
Hannah Miller, thank you so much for coming in and
talking baseball with us and regional sports networks and all
the hooton Nanny on the Bloomberg Business of Sports. Thank
you again, Thank you for having me our thanks to
Hannah Miller for joining us. She covers media and entertainment
for Bloomberg News. Up next, we turned to soccer in
Argentina and the big money going into bringing top talent there.
(12:48):
For my colleagues Damian Sasauer and Vanessa Perdomo. I'm Michael Barr.
You're listening to the Bloomberg Business of Sports from Bloomberg
Radio around the world.
Speaker 1 (13:02):
This is Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (13:07):
This is the Bloomberg Business of Sports. We explore the
big money issues in the world of sports. I'm Michael
Barr along with Damian Sassauer and Vanessa Berdomo. Argentinian soccer
clubs are doling out big time contracts to players lately,
driving a revival in the team's and in homegrown talent.
And Bloomberg is reporting that Argentina's president Javier Malay's economy
(13:30):
has a lot to do with it. Joining us now
to dive into the revival of big money soccer in
Argentina is Bloomberg Buenos Aire's bureau chief Patrick Gillespie. Patrick,
Welcome to the Bloomberg Business of Sports.
Speaker 9 (13:43):
Thank you for having me.
Speaker 2 (13:45):
Argentine getting back into soccer now because before they really
couldn't afford it, But all of a sudden, now they're
signing million dollar contracts to revive soccer in the country
and it's all thanks to the shoring up of the pesos.
(14:06):
Can you describe what's going on?
Speaker 9 (14:08):
Yes, President Javier Malay, his overhaul of Argentina's economy has
had an unexpected outcome. Soccer players are returning home to
a soccer or should I say football crazy nation. For decades,
when the likes of Leo Messi or Diego Maradona grew
up in Argentina, it was just understood that players were
(14:31):
going to go to Europe. First, the best teams are
there in Europe, but also Argentina's repeated economic crises made
it impossible for the top clubs in Argentina to recruit
and retain great players. And now that's starting to change.
Little by little thanks mostly to Javier Malay's economic policies.
(14:51):
He factors in because Melay controls the exchange rate between
the pacer and the dollar, and the currency is getting
much stronger on Mela's watch. For example, prices in paesols
in Argentina went up over one hundred percent last year,
but the currency only, I know, we wouldn't say this
very jokingly, but only fell twenty two percent last year.
(15:14):
And so that mismatch between how much prices are going
up and how much the currency is going down is
making the currency, the peso, a lot stronger, and that's
helping football teams sign players to these multimillion dollar contracts.
Speaker 8 (15:28):
It's such an interesting, you know, thing that's happened here.
It's a very unique bloomberg business of sports stories, the
way that the dollar and the paeso have then affected
the sports and the soccer system there. Can you give
us a little bit more on that and how, you know,
the owners of these clubs are dealing with that, how
they've been able to recruit these players back, and how
(15:50):
it's you know, really raised maybe has it raised you know,
the overall fever of football again or how how has
it raised you know the level of play.
Speaker 9 (16:00):
There's about two dozen soccer players in Argentina making a
million dollars or more this year, and that's up from
just a handful a couple of years ago. To give
a little bit more size and scope, Argentine clubs has
spent about two hundred million dollars in what's called the
transfer market, where players shift from say one league to
the other, and that's up from less than half of
(16:21):
that amount, less than one hundred million dollars just a couple.
Speaker 6 (16:24):
Of years ago.
Speaker 9 (16:25):
So really you've seen an exponential increase in how much
teams are spending on players. And also, I think another
key difference is that these players are not, say sun setting,
they're not exactly at the end of their careers. One
example is Sebastian Drusi, who is just twenty nine years old.
He signed a ten million dollar contract with one of
(16:45):
Argentina's biggest clubs, river Plate. Another example is Gonzale Montiel,
who scored a very important goal during Argentina's World Cup
victory a couple of years ago. He returned as well
on a multimillion dollar contract. So not only is Argentina
getting more players from abroad, right now on these big contracts,
(17:05):
but they're getting high quality talent that's not players at
the end of their careers but still in their prime.
Speaker 5 (17:11):
Patrick, you know you mentioned Rusi and you know I
look at the contract he signed and yeah, okay, he
was getting paid ten point four billion pasos when he
signed it. Well guess what now due to the depreciation
of the paeso, it's ten point six billion, right, So
the movement the fx vall and our audience knows that
I run emerging market fixed income here at Bloomberg, so
the blue chips to operate is nothing new to me,
my friend. And you know, my question is this A
(17:33):
million dollars a year is peanuts when you see what
McAllister Martinez and Dibala and some of these other Argentine
players are getting paid from what as Roma Liverpool. I mean,
I think Thecalison is getting paid seven point eight million
US a year. So this is just scratching the surface.
And I guess my question for you, sir, is does
Hobby and Malay really have the clout to pull some
(17:54):
of the top players, the top Argentine players in the
world back home and the two.
Speaker 9 (18:00):
I think the answer is no, because first Unfortunately, it
seems like Leo Messi is probably going to finish his
career at Inter Miami.
Speaker 5 (18:08):
But no one's gonna pull.
Speaker 6 (18:10):
Leo out of Miami.
Speaker 9 (18:11):
I agree with you there, Patrick, I don't Yeah, I
don't think Leo Messi is coming home to play for
a pro team in Argentina. Another big factor that Melay
could change is that MELA is trying to change the
structure of these clubs in Argentina into more private enterprise.
Right now, a lot of the clubs, their leadership is
elected by the fan base, and so that limits the
(18:34):
amount of say foreign private investment that can go into
these clubs and juice up contracts. So we've seen in
Brazil there was a reform in their soccer leagues to
make make it easier for teams to have foreign investors,
and that's helped to attract, retain and recruit higher quality talent.
So I don't know if the the World Cup starting
(18:56):
roster is going to come back to one of the
sorries anytime soon, but certainly the stronger Paeso is going
to help attract more players in the near term after
really decades of the talent just immediately leaving either a
MESSI left Argentina when he was twelve years old. Many
of these players leave when they're twenty one, twenty two
(19:16):
years old, so the fact that some are coming still
relatively in their prime is welcome news. But you're right,
this is a very early trend. It's very incipient, and
there's a lot of questions about whether Melay can sustain
his economic policies, particularly the currency FX policies that are
really a big part of Argentina's negotiation with the International
Monetary Fund right now.
Speaker 8 (19:37):
I mean, Boca Juniors is going to be playing in
the FIFA Club World Cup this year, so signing those
a few of the big players like Alan Vlesco who's
playing in the MLS and now he's playing for Boga Juniors.
Do you think these new signings are going to help
them on that world stage.
Speaker 9 (19:54):
Yes, these players especially, I think when I know we
mentioned Boca Juniors, but I think River Plate stands to
benefit the most just because of their these two players
in their prime joining an already pretty strong club. So
I think you are going to see the Argentine professional
(20:14):
clubs compete at a higher level at the international stage,
which is where they were about. You know, two decades
ago there were friendlies between Boca Juniors and some of
the Spanish clubs where Boca either won or pulled a draw,
which at the time was unheard of. It just never
you could never conceive of that. So it would be really,
(20:35):
I think special for Argentine clubs that are considered you know,
going to an Argentine football game is an incredible experience,
and to see that happen on an international stage like
the FIFA Club Cup would be really really special. But
I can confirm, and I know people like Matt Damon
can confirm that going to a Boca Juniors game or
a River Plate game is one of the most phenomenal
(20:57):
sports experiences any fan could ever have. And I'm not
talking about a championship. I mean you can go to
a regular season game and it's nearly a religious experience.
It's really incredible, the passion the fans bring every night.
Speaker 5 (21:08):
Patrick, I have to ask this. I mean, we have
you on the phone here, you're dialing in from Buenos Airas,
and you know what is sentiment like on the ground
in Argentina right now? I mean it's got to be positive.
I mean, through all the austerity measures, that Malay has
passed through in the last year. You know, he's still
you know, it seems that the populace is still very
very pleased with him, that they're still very much on
(21:29):
his side and in support of him. You know, talk
to us a little bit about you know, what you're
seeing on the ground.
Speaker 9 (21:35):
Yeah, Melay is still enjoying a relatively high level of
approval rating, especially when you think about what you the
measures you outlined, a historic austerity campaign that saw the
cost of living increase significantly in Argentina. Milee still has
approval ratings around forty seven percent. Those of stayed stable
for several months at this point, and they're really He
(21:59):
only stays to benefit in the upcoming months as the
economy is expected to continue recovering from a pretty brutal recession.
But the government published economic activity data that showed five
percent annual growth in December. That's one of the highest
figures in years. So Malay has a stable exchange rate,
lowering inflation, and an economy that's recovering with pretty stable unemployment.
(22:23):
At the moment, the wind is at its back his
back for the economy. Melay is benefiting, but he's dealing
with some say some issues on the sidelines that investors
would like him to, you know, get off stop speaking about.
But if Malay can focus on the IMF program and
(22:44):
economic recovery in unwinding some of the currency controls and
other restrictions that he inherited from the previous government, you know,
he could be looking at a big victory when Argentina
gets to midterm elections in October, and that would help
him advance his pro mark agenda even more.
Speaker 2 (23:01):
I know we're running out of time, Patrick, but I
want to try to kind of put a bow on
it about Malay before he had taken over, with his
economic policies, obscure markets. We're talking like Paraguay and Bolivia
because we all know that they're like super soccer markets.
They were luring the Argentine players away before Malay came in.
Speaker 9 (23:27):
Absolutely, we had inflation reach nearly three hundred percent last
year as Mila was trying to implement some of the
necessary cold medicine Argentina needed because his predecessors were simply
spending too much money and printing too much money, and
that resulted in sort of a carving out of the
soccer talent in Argentina, where some players felt forced to
(23:49):
go to much smaller markets because they have more stable currencies.
It really is unimaginable, the change from a just a
couple of years ago when players were going anywhere they
could because they can't get paid in dollars here. They
have to be paid in paesos. You know, the currency
was losing. It was, you know, has lost since I've
(24:13):
arrived in twenty eighteen, the peso has lost ninety five
percent of its value. So we've had some of many
of the bills, the cash bills that I first used
to have when you got to the ATM here, they
no longer exist because the government stopped printing him They're
worth nearly nothing. So the impact that Melee is having
(24:34):
on the soccer league is really a reflection of his
ability to stabilize the economy. But there's a lot of
questions about whether his policies are sustainable in the near
term or after this year because Argentina has midterm elections.
But also he still has a whole lot of homework
to do on the economy when it comes to, you know,
showing up the central bank making sure they have the
(24:57):
stability to keep the Paso on a more stable path.
So there's a lot of questions about his economic policies,
but for now he's benefiting from a lot of social support.
People like this economic program. They feel like the worst
is behind them in terms of the recession and the
biggest of the austerity measures, and it looks like me
(25:17):
Lay could be heading towards a big victory when we
get to those midterms later this year.
Speaker 2 (25:22):
Buenos Ares Bureau Chief Patrick Gillespie, thank you so much
for joining us on the Bloomberg Business of Sports. We
really do appreciate it.
Speaker 9 (25:30):
Thank you so much.
Speaker 2 (25:31):
Our thanks to Bloomberg Buenos Aires Bureau Chief Patrick Gillespie
for joining us. Up next, Carla Food joins the conversation
as we talk sports, gambling and bring in the founder
and CEO of Gambling dot Com group for Damian Sasaur
and Vanessa Verdomo. I'm Michael Barr. You're listening to the
Bloomberg Business of Sports from Bloomberg Radio around the world.
Speaker 1 (25:59):
This is Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (26:04):
Thanks for joining us on the Bloomberg Business of Sports,
where we explore the big money issues in the world
of sports. I'm Michael Barr, along with Scarlettfu and Damian Sasaur.
Gambling dot Com Group, trading under the ticket symbol gamb
is a leading sports gambling affiliate working as a liaison
between the growing sports gambling public and the popular sportsbooks
(26:28):
and regulated online casinos. Gambling dot Com Group's founder and CEO,
Charles Gillespie joins us now to talk about the platform
and about the sports gaming landscape. Charles, Welcome to the
Bloomberg Business of sports.
Speaker 6 (26:42):
Great to be here, guys. How can I help?
Speaker 2 (26:45):
Well, you're talking to a degenerate gambler, But I love Listen,
I love online gambling. I don't get carried away with it,
and I think, and I'm going to start right from
the beginning. That's the key to the whole Google. Lot
to talk about it, but that's the key to the
whole thing. Nothing wrong. If you want to go and
gamble your five ten dollars and put it on the
(27:07):
Detroit Tigers, you go ahead.
Speaker 6 (27:10):
That's absolutely right.
Speaker 3 (27:11):
I mean, you know, the industry in the United States
wasn't really regulated in to any meaningful extent until about
twenty eighteen, when the Supreme Court decision allowed states to
start regulating and that's brought the business out of the shadows.
You know, it's not like people weren't betting online prior
to twenty eighteen. It was just entirely offshore. So you know,
(27:32):
in order to have proper safeguards for people and identify
problem gambling early, it's critical that the activity actually be
regulated and on shore.
Speaker 6 (27:44):
Otherwise you've got no visibility into it and you.
Speaker 3 (27:47):
Can't help these people, which of course, you know, problem
gambling is is it's a problem for the for the industry.
It's everybody's problem, and nobody wants to, you know, see
these people struggle, so it's a critical focus area for
the whole indust that's.
Speaker 2 (28:00):
Right, Scarlett. I was caught up in the Kingman Islands
era Man, you know, before it was regulated. Thank god
it's regulated now.
Speaker 4 (28:09):
Scarlett Charles, you've come on Bloomberg Radio in the past
to tell us how the online gambling industry is pretty
resilient to the swings of the economy, the ups and downs.
For example, in the UK, gambling growing at more than
eight percent a year when GDP is forecast to be
sub one percent for a second year. Talk about the
growth of online gambling in the US, especially sports betting,
and the seasonal pattern of that growth. I'm wondering how
(28:31):
much of a correlation there is with calendar events like
the super Bowl in February or March Madness, or the
NBA Finals in June or the World Series in October.
Speaker 3 (28:40):
The growth of the industry in the US absolutely is
driven in part by the sporting calendar. The super Bowl,
of course, the biggest individual betting event of the year.
March Madness and aggregate would have a lot more handle
than the super Bowl, and that's obviously because it's many
more events, it's not just one event. Another big driver
(29:01):
in the US is every time there's a new state
which goes live. So at this point, Missouri.
Speaker 4 (29:07):
That's a one time thing.
Speaker 3 (29:09):
Well it's a one time thing, but then it kind
of permanently expands the tam right, you know, there's a
kind of rush of activity when the new state goes live,
all that pent up demand. You know, people that have
been waiting to register accounts go out and set up
their accounts, and then it quiets down a bit. But
then you're going to have, you know, fifteen twenty thirty
(29:29):
years of fairly reliable growth. You know, you just look
at the UK, as you pointed out, they regulated online
gambling in two thousand and five and it's still growing
by nearly double digit rates, is right, And you know,
with our business, we're making more money in the UK
than we have ever made before, despite the fact that
this this business has been around for some time. Just
(29:52):
to clarify for your for all the listeners out there
at gambling dot com, it's not actually an online gambling site,
despite the names.
Speaker 6 (29:59):
It's a a.
Speaker 3 (30:00):
Website to help people find the best places to play online.
So whether it's sports betting or online casino, there's a
lot of different options out there, especially in the US.
You know, every single state is different.
Speaker 5 (30:12):
Charles, you're the group CEO of gambling dot Com group,
but you started the company in two thousand and six.
You're an American, you went to UNC Chapel Hill, but
you're living in Europe. You're actually living in Monte Carlo,
one of my most favorite places. They know me over
there by name, and I really just wanted to ask you,
you know now that gambling has really arrived here in
the United States. I mean, you're really well positioned having
(30:32):
lived there for a very long time to see how
it affected Europe before the US, right, because gambling was
legal there before us. So talk to us a little
bit about what comes next for the United States of
America for sports gambling here in the US. If you
had to look out over the next say, two three,
five years, you know, do you expect every state to
legalize sports gambling? I mean, is it unique to the
US that you know it's taking us this long to
(30:54):
get there. I'm just curious to hear your thoughts.
Speaker 3 (30:55):
Yeah, great questions, and I'm very happy to talk about that.
We have a bit of a unique perspective in this
because I grew up in the States. I grew up
in North Carolina. I went to UNC. When I was
graduating from UNC, I wanted to start a business in
the online gaming industry. But the industry didn't exist in
the United States.
Speaker 4 (31:11):
It wasn't ahead of your time.
Speaker 6 (31:12):
Yeah, you just couldn't do it here.
Speaker 3 (31:15):
So I left and we ended up building one of
the biggest businesses in the industry in Europe. And you know,
on the back of the power of the UK and
and and you know other European markets, Ireland, Sweden, Italy,
and Germany. I mean, it's you know, there's a lot
of regulation. The industry was regulated first in Europe. You know,
the UK has been the biggest regulated online gamiling market,
(31:37):
you know, basically until now. It still is bigger than
any individual US state right now, the US and aggregate,
if you count you know, all the states, it's bigger
than the UK. So that has really set the tone
and for the whole industry. Right you know, a lot
of the technology companies, marketing companies, data services companies, they're
all European. Actually, biggest online gaming company in the world
(31:58):
is flutter based in Dublin. But of course you've got DraftKings,
you know, in Flutternow owns fan Duel, And you've had
this coming of age in America of this industry finally,
but because it was so late to the party, it's
been this just absolute mad rush for everyone in the
US to kind of catch up. But you know, you
(32:18):
talk endlessly about you know, American technology hegemony and you know, Google, Apple,
every Magnificent seven, all this stuff. Right, It's it's quite
rare that you can find an example of Europe leading
in an in any area of technology. But they really
are truly ahead of the United States still when it
comes to everything related to the online gambling industry. And
(32:41):
that's not a slight that you know, some of the
big American suppliers or operators, which are amazing businesses. But
you know, if you just look at the balance of
the industry, it is still fundamentally not led by the
United States. Now, five or ten years from now, anything's possible.
You know, I think the industry is going to continue
to grow up in the US. The center of gravity
(33:01):
of the industry in terms of you know, where is
the heat, where is the investment, where's the growth? That's
clearly been the United States since twenty eighteen. You've got
thirty plus states now with sports betting, You've got a
handful of states with these online casino games, and that
still works. It works because they have both sports betting
(33:22):
and the online casino games, which kind of prop each
other up. It's a one plus one equals more than
two sort of situation.
Speaker 4 (33:29):
Charles, You've made a number of acquisitions in the past year.
In April last April, you bought Excelmedia sports betting and
gaming assets in Europe and Canada. More recently, in December,
you bought odds Jam, which has been described as a
Bloomberg terminal for sports betters, which I like that comparison
a lot. What other capabilities are you looking to grow
through purchases rather than organically.
Speaker 6 (33:51):
So the Heart and.
Speaker 3 (33:52):
Solar business is a affiliate marketing business for the online
gambling industry.
Speaker 6 (33:57):
It's an incredible business. We drive a.
Speaker 3 (33:59):
Lot of our traffic from Google Search, natural search. We
know we buy a little bit of media, but it's
fundamentally a business that drives its revenue from natural search,
and that's a very high margin business. But you know,
we're a publicly traded company and as we think about
our future is a is a publicly traded company that
(34:21):
that revenue from the affiliate business. It can be a
little bit volatile, you know. Frankly, it's a phenomenal business
and extremely cash generative, but as a listed company you
got to, you know, manage the earnings core to quarter.
And we like these subscription revenue businesses. So when you
think about odds Jam, you've got a highly predictable B
(34:45):
two C subscription business. And they also have a B
to B side of that that business called Optic Gods.
They sell that to you know, that's really the Bloomberg
terminal if you will. That's the more sophisticated product which
they actual we sell to the online gambling operators themselves
so that they can manage their risks. You know, they
want to make sure they're on the right side of
(35:06):
every market. They're not, you know, too far off of
the market and everything. Both of those businesses. The revenue
there is more predictable, right, it's longer term contracts, it's
it's it's it's just we can forecast that with a
higher degree of precision. So when you mix that into
our overall revenue profile, it gives us, you know, a
(35:27):
greater kind of control quarter to quarter to see where
we're going to land. It just makes it works well
in the public company context. But at the same time,
their margins are actually even higher than our margins are
already very high margins. So we love that acquisition. It's
gone over really well with all of our investors. That
really ticked all the right boxes, and there's a bright
(35:47):
future for that.
Speaker 2 (35:48):
Now. To give you how much money is out there,
we're talking last year about one hundred and fifty billion
dollars in the industry online gaming alone. Now this year, yes,
only Missouri is expected to approve it, but it's going
to grow because we did a story recently Texas Governor
Greg Abbott, who was totally against it when it first
(36:12):
came out, and recently said, you know, maybe this isn't
such a bad idea. So I see a lot of
growth in this.
Speaker 3 (36:21):
The only thing we know for sure right now in
terms of new state launches is that Missouri will launch.
You know, that's already been voted on. That was a
referendum in November, and in the terms of that referendum,
they have to launch by December. So that's one hundred
percent coming and is incremental to our guidance because we
don't put new state launches in our guidance until the
(36:43):
date of launches is crystal clear. But all of the
other states are, you know, still looking at it right now.
So a lot of these state legislators they meet in
the first couple of months of the year, so a
lot of these folks are in session right now, including Texas.
Speaker 6 (36:59):
Texas every other year, but they're in session now. They're
looking at it.
Speaker 3 (37:03):
There's tons of bills both on the sports betting and
I gaming side in process now that have been filed.
It is certainly my view and that of the rest
of the senior people in the industry that will get
a few more things through this year. It's always hard
to say exactly what, but you know, I'd be shocked
(37:23):
if we don't get you know, two or three sports
betting states and two or three I gaming states.
Speaker 6 (37:29):
And but you know, it.
Speaker 3 (37:30):
Takes it can take six, nine, twelve months for them
to launch, right so even if they get the legislation
finished in the first half of the year, they may
not launch until twenty twenty six. And you know, of
course with these new as we discussed these new state
launches being kind of big moments of business for us,
we don't add it into our guidance until we're know,
you know, exactly when it's going to launch, because you know,
(37:52):
we need to show where that which quarter of that
revenue is going to fall into.
Speaker 2 (37:56):
Charles Gillespie, Oh, my goodness, Grace, as we talk in
the game, and I just said I was out before
we came into the studio, as you know, I said,
my goodness, are you ready, Michael, I said, yeah, that's
like the rat talking about the cheese man talking about gambling. Here.
Charles Gillespie, thank you for coming on the Bloomberg Business
of Sports. Gambling dot Com CEO right here in studio.
(38:19):
Thank you, sir, my pleasure. A special thanks to Charles
Gilaspie for joining us. He is the founder and CEO
at Gambling dot Com group, and thanks to you for
joining us. For my colleagues Damien Sasauer, Scarlettfoo and Vanessa Berdomo,
I'm Michael Barr. Tune in again next week for the
latest on the stories moving big old money in the
(38:40):
world of sports. You're listening to The Bloomberg Business of
Sports from Bloomberg Radio around the world.
Bloomberg Audio Studios, Podcasts, radio News. This is the Business
of sports.
Speaker 2 (00:10):
The business of sports can be intimidating or hard for
a starting to break into.
Speaker 3 (00:14):
We really appreciate when our owners are actually there, you know,
with us through the journey.
Speaker 4 (00:19):
Teams ours especially have been very intentional to diversify at
all levels of the company.
Speaker 5 (00:23):
I think we're in bolden years for the NFL and
college football. Our demographic reach has continued to explode.
Speaker 4 (00:30):
This is going to be really unlocking the streaming platform
for sports fans.
Speaker 6 (00:34):
Sports evaluations arising.
Speaker 2 (00:36):
We'll see when they peak.
Speaker 3 (00:37):
You don't have to be the best in your sports
and make a whole ton of money.
Speaker 1 (00:43):
Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (00:47):
This is the Bloomberg Business of Sports, where we explore
the big money issues in the world of sports. I'm
Michael Barr, along with my colleagues Damian Sasauur and Vanessa Berdomo.
Scarlett Foo would join us later on in the show.
Coming up, we'll talk with the founder and CEO of
Gambling dot Com Group, Charles Gillespie, about the growth of
(01:08):
the sports gaming industry.
Speaker 6 (01:09):
All that pent up demand.
Speaker 3 (01:11):
You know, people that have been waiting to register accounts,
go out and set up their accounts, and then it
quiets down a bit, But then you're going to have,
you know, fifteen twenty thirty years of fairly reliable growth.
Speaker 2 (01:23):
We'll also talk about the big money going into getting
and keeping top Argentine soccer talent in Argentina and what
President Javier Malay has to do with it. All that
and more is on the way on the Bloomberg Business
of Sports. But first we got a couple of big
moves in sports media, and we want to go over
all of that, including ESPN officially moving on from Baseball.
(01:49):
Joining us now to talk about it is Bloomberg News,
Media and Entertainment reporter Hannah Miller. Hannah, welcome to the
Bloomberg Business of Sports.
Speaker 7 (01:58):
Thank you for having me.
Speaker 2 (02:00):
Well well, well, well, well we're back to that old
fight with the regional sports networks and then the ESPN
and all this stuff. So I'm going to start with
ESPN first. ESPN. Now, Now, the way I'm going to
word this is going to sound weird. They're dropping Major
League Baseball, but major League Baseball says, oh no, no, no, no,
(02:23):
we're dropping you. So can you explain what happened.
Speaker 7 (02:28):
Yeah, so MLB is trying to make this seem very mutual.
You know that they came to this decision together, but
we know that there's more tension than that. You know,
MLB has been really trying to expand with its meteorites.
It's struck multiple deals, including with Roku and Apple. And
you know, these deals are a lot cheaper than what
(02:51):
ESPN was paying. I mean, the deal with ESPN was
five hundred and fifty million dollars per year, and they
wanted they wanted a better price than that. So you know,
they've kind of gone tip for tat. You know, MLB
has complained about you know, ESPN not covering baseball enough,
not giving them enough airtime. ESPN has countered with you know,
(03:12):
this is too high of a price to pay, and
they basically you know that this deal ended early. There
was an early opt out for the you know, after
the twenty twenty five season. The deal actually expired in
twenty twenty eight, so this is this is pretty surprising,
but you know, the door is still open. ESPN N
MLB could come together come to some sort of agreement.
(03:35):
So we'll see if that happens.
Speaker 8 (03:37):
And it's interesting for me. You know that the back
and forth is so interesting. You know, why did ESPN
ultimately feel like that they were paying too much?
Speaker 7 (03:45):
Yeah, so I think ESPN was really looking at these
other platforms. You know, they were looking at Roku, they
were looking at Apple, both of whom are trying to
get more and more into support streaming. And you know,
ESPN was like, hey, we want a better deal. We
want to be more in line with what these are
their guys are paying. So it's been very interesting to
see in the context of other you know, sports media rights.
(04:05):
The NBA deal over the summer was a knockout, you know,
record value. I think there is a real question of
whether MLB will be the only major sports league to
see a decline in price sport media rights. But you know,
even though ratings have been good for them, I don't
think they've necessarily had the degree of success that they
were hoping for. You know, in the NBA that it's
(04:28):
just a lot of star power. You know, it's a
game that people describe as more fun to watch. So
these are going to be problems that follow MLB going forward.
Speaker 5 (04:39):
Well, and let's crystallize it for our audience, shall we
I mean the deal, as I understand, it was a
seven year deal that ESPN agreed to pay the league
five hund fifty million a year, thirty regular season games,
including the wildcard playoff round, and I think the home
run Derby. But you know, I think I mean for me,
I mean, and I watch baseball, I mean I never
have to watch on an ESPN beca YUS. It's on Fox,
(05:01):
it's turn it's on Turner, it's on Apple, it's on Peacock.
I mean, is that the reason did Major League Baseball
kind of sell themselves short? Did they thin the rankings
so to speak by offering on so many different platforms?
Speaker 7 (05:14):
Yeah, I think that definitely played a part into it.
You know, MLB has been known for sharing the love.
You know, you can access games on Fox, on Turner,
you know, there are a lot of ways to watch it.
You also, you know, still have some strong regional networks.
I think that definitely kind of diluted things a bit,
just spreading them around to different places.
Speaker 2 (05:35):
Well, here's what I'm confused about, because in the contract,
ESPN was going to air thirty regular season games, the
five hundred million dollar contract. Then, of course the wild
card playoffs, the home run derby, ten spring training games,
but they're saying MLB that THEYD got it did not
(05:55):
get enough baseball coverage? Are they talking about the regular
when you watch daily ESPN reports, that's what they're upset about.
Speaker 7 (06:05):
I think that's a huge part of it. It's just
you know, not getting it focused enough in a lot
of ESPN sports shows and their news coverage. Even the
spring training games is actually up to ten games that
they could have aired, so they didn't even have to
fulfill fill all of that with showing games. So you know,
it's it's definitely I think makes sense in the context
of this battle. You know, like neither side was satisfied
(06:27):
with what was happening.
Speaker 2 (06:28):
Wow, I want to see the home run derby. Now
where am I going to see it?
Speaker 7 (06:32):
Well, that's the question. There's gonna you know, there are
rights up for grabs here, and like I said, they
could come back together, you know, patch things up, have
an agreement where they could get those games back.
Speaker 8 (06:43):
And you think that when they come when they do
get their agreement, that you think it's going to be
a lower value than they would think.
Speaker 7 (06:51):
I think it would. I think that's definitely a strong possibility.
I was talking about that with someone the other day
where it's just like, you know, we've seen just you know,
knockouts for other leagues. You know, we talked about the
NBA before. But yeah, there is a question here that
MLB could be the outlier.
Speaker 5 (07:08):
You know, Hannah, you know I have to ask you
just to switch gears here. I mean this whole restructuring
of Diamond Sports Group I think it's now called main
Street Sports Group, right, and you know, we all know
what happened. They filed for bankruptcy in twenty twenty three,
then they want approval of an Amazon aided restructuring, and
now Diamond I'm sorry, main Street Sports Group is going
(07:30):
to be offering sixteen regional sports networks for twenty dollars
a month in addition to its streaming service. I mean,
how did this happen? How did this company turn it
around so quickly?
Speaker 7 (07:41):
Yeah, they needed a lot of help to turn it around.
So all of this is progressive Amazon helps, Yes, yeah,
this is all part of their bankruptcy restructuring. This is
how they were merging from bankruptcy. So both Amazon and
FanDuel stepped in as white knights here. So Amazon struck
a multi year streaming with Diamond. Diamond has undergone this
(08:02):
rebrand to be main Street Sports Group. You know, they
want to leave Diamond in the past, have a new future.
And any other player here is FanDuel. So this these
regional sports packages, it's going to be marketed under FanDuel
Sports Network and this naming rights agreement that you know,
FanDuel paid for this branding that helped you know, Diamond
(08:24):
slash main Street get out of bankruptcy. So none of
this is a huge surprise, like we've been waiting for
this to happen and get finalized. But yeah, I mean
this is how they were able to get out of
the hole.
Speaker 2 (08:35):
Well wait a minute, Piggy loves going in the sports
draft here, so I want to make sure I got
this right. Amazon. They're going to offer sixteen regional sports networks.
Anyone of the sixteen I can watch is I live
in the Poconos in Pennsylvania, and I could get Miami
if I wanted to and watch that all sixteen are open.
Speaker 7 (08:57):
My understanding is it is based off zip code, so
you will get the regional sports network that's for your area.
So I actually was looking at the website today and
they were like, this is not available in your area,
Like get out, you know, New York, It's not for
New York. So that that's my understanding at least.
Speaker 8 (09:13):
Oh, and it's interesting when we were thinking about that
and thinking about local blackouts and stuff. So one of
the things that happened when Diamond Sports filed for bankruptcy
was the MLB. You know, reports kind of came out
that they were almost it was almost in their favor
for regional sports networks to go away because they wanted
to retain the rights to all of their media rights
(09:35):
so that they could go to national partners and that
would maximize revenue and stop local blackouts. So how does
this all.
Speaker 7 (09:42):
Plan to that?
Speaker 8 (09:43):
This new Amazon deal with main Street And then when
you look at popular regional sports networks, like you said.
Speaker 7 (09:48):
Like with yes, yeah, I mean so Amazon has been
making this push into regional sports streaming and just sports
streaming more broadly, Like this isn't totally shocking. And you know,
this struggle for regional sports network it's a tale as
old as time. You know, people are switching to streaming
their trimming expensive cable packages. Yeah, I think they're hoping
(10:10):
that this is going to make everything more accessible to people.
You know that they will get more coverage. We've even
seen you know, you brought up yes, like they're going
to be Yankees games streaming on Amazon. We just heard
about that, and it's something that you know, it's going
to help these regional sports networks like this is not
(10:30):
easy for them, Like MLB has also been doing deals
with various teams to kind of develop their own regional brand.
But yeah, I mean, I think with looking ahead, we're
just going to see more and more stuff switched from
cable to streaming. This is across the board, not just
in sports. People want to pay less money per month,
(10:51):
they want similar packages, and they want more customization, so
all of this con per month.
Speaker 8 (10:56):
But it's twenty dollars a month on a streaming service
straight up than what you pay for it already, which
is crazy.
Speaker 7 (11:02):
Yeah, no, I mean it's I think they're kind of
going for cord cutters here, like yeah, you're paying twenty
dollars a month for your streaming package, but like maybe
you're not doing that expensive sports cable package that is,
you know, hundreds of dollars a month, Like maybe you're
getting rid of that to kind of get the sports
you want specifically for your area. It's a toss up.
(11:24):
I don't know. I think like these slim sports packages,
that's going to be a trend we're going to continue
to see in twenty twenty five.
Speaker 5 (11:32):
Vanessa, it's the Arizona Diamondbacks we're talking about here. I mean,
shame on you, but no, I mean, seriously, Hannah, my
last question is this. I know that you know diamond
used Chapter sorry, main Street used Chapter eleven protection to
end broadcast deals with a few teams, the Diamondbacks being
one of them. I think the Padres and the Rangers
were a few others. Who do they have agreements left with?
I think I think they had to deal with the Braves,
(11:54):
maybe the Angels. I mean, I mean, do we know
who those six teams are? Sixteen teams are? And I
think what Michael Barr really wants to know. Are the
Tigers one of them?
Speaker 7 (12:03):
Yes, the Tigers are one of them. Yeah, Detroit, La, Miami.
Like they have some big cities that are in the
mix here, so you know there are good offerings like
it's not you know, there are some really high profile
teams included here. So yeah, it's a whole mix, but yeah,
definitely definitely La Miami Air standouts.
Speaker 2 (12:25):
Hannah Miller, thank you so much for coming in and
talking baseball with us and regional sports networks and all
the hooton Nanny on the Bloomberg Business of Sports. Thank
you again, Thank you for having me our thanks to
Hannah Miller for joining us. She covers media and entertainment
for Bloomberg News. Up next, we turned to soccer in
Argentina and the big money going into bringing top talent there.
(12:48):
For my colleagues Damian Sasauer and Vanessa Perdomo. I'm Michael Barr.
You're listening to the Bloomberg Business of Sports from Bloomberg
Radio around the world.
Speaker 1 (13:02):
This is Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (13:07):
This is the Bloomberg Business of Sports. We explore the
big money issues in the world of sports. I'm Michael
Barr along with Damian Sassauer and Vanessa Berdomo. Argentinian soccer
clubs are doling out big time contracts to players lately,
driving a revival in the team's and in homegrown talent.
And Bloomberg is reporting that Argentina's president Javier Malay's economy
(13:30):
has a lot to do with it. Joining us now
to dive into the revival of big money soccer in
Argentina is Bloomberg Buenos Aire's bureau chief Patrick Gillespie. Patrick,
Welcome to the Bloomberg Business of Sports.
Speaker 9 (13:43):
Thank you for having me.
Speaker 2 (13:45):
Argentine getting back into soccer now because before they really
couldn't afford it, But all of a sudden, now they're
signing million dollar contracts to revive soccer in the country
and it's all thanks to the shoring up of the pesos.
(14:06):
Can you describe what's going on?
Speaker 9 (14:08):
Yes, President Javier Malay, his overhaul of Argentina's economy has
had an unexpected outcome. Soccer players are returning home to
a soccer or should I say football crazy nation. For decades,
when the likes of Leo Messi or Diego Maradona grew
up in Argentina, it was just understood that players were
(14:31):
going to go to Europe. First, the best teams are
there in Europe, but also Argentina's repeated economic crises made
it impossible for the top clubs in Argentina to recruit
and retain great players. And now that's starting to change.
Little by little thanks mostly to Javier Malay's economic policies.
(14:51):
He factors in because Melay controls the exchange rate between
the pacer and the dollar, and the currency is getting
much stronger on Mela's watch. For example, prices in paesols
in Argentina went up over one hundred percent last year,
but the currency only, I know, we wouldn't say this
very jokingly, but only fell twenty two percent last year.
(15:14):
And so that mismatch between how much prices are going
up and how much the currency is going down is
making the currency, the peso, a lot stronger, and that's
helping football teams sign players to these multimillion dollar contracts.
Speaker 8 (15:28):
It's such an interesting, you know, thing that's happened here.
It's a very unique bloomberg business of sports stories, the
way that the dollar and the paeso have then affected
the sports and the soccer system there. Can you give
us a little bit more on that and how, you know,
the owners of these clubs are dealing with that, how
they've been able to recruit these players back, and how
(15:50):
it's you know, really raised maybe has it raised you know,
the overall fever of football again or how how has
it raised you know the level of play.
Speaker 9 (16:00):
There's about two dozen soccer players in Argentina making a
million dollars or more this year, and that's up from
just a handful a couple of years ago. To give
a little bit more size and scope, Argentine clubs has
spent about two hundred million dollars in what's called the
transfer market, where players shift from say one league to
the other, and that's up from less than half of
(16:21):
that amount, less than one hundred million dollars just a couple.
Speaker 6 (16:24):
Of years ago.
Speaker 9 (16:25):
So really you've seen an exponential increase in how much
teams are spending on players. And also, I think another
key difference is that these players are not, say sun setting,
they're not exactly at the end of their careers. One
example is Sebastian Drusi, who is just twenty nine years old.
He signed a ten million dollar contract with one of
(16:45):
Argentina's biggest clubs, river Plate. Another example is Gonzale Montiel,
who scored a very important goal during Argentina's World Cup
victory a couple of years ago. He returned as well
on a multimillion dollar contract. So not only is Argentina
getting more players from abroad, right now on these big contracts,
(17:05):
but they're getting high quality talent that's not players at
the end of their careers but still in their prime.
Speaker 5 (17:11):
Patrick, you know you mentioned Rusi and you know I
look at the contract he signed and yeah, okay, he
was getting paid ten point four billion pasos when he
signed it. Well guess what now due to the depreciation
of the paeso, it's ten point six billion, right, So
the movement the fx vall and our audience knows that
I run emerging market fixed income here at Bloomberg, so
the blue chips to operate is nothing new to me,
my friend. And you know, my question is this A
(17:33):
million dollars a year is peanuts when you see what
McAllister Martinez and Dibala and some of these other Argentine
players are getting paid from what as Roma Liverpool. I mean,
I think Thecalison is getting paid seven point eight million
US a year. So this is just scratching the surface.
And I guess my question for you, sir, is does
Hobby and Malay really have the clout to pull some
(17:54):
of the top players, the top Argentine players in the
world back home and the two.
Speaker 9 (18:00):
I think the answer is no, because first Unfortunately, it
seems like Leo Messi is probably going to finish his
career at Inter Miami.
Speaker 5 (18:08):
But no one's gonna pull.
Speaker 6 (18:10):
Leo out of Miami.
Speaker 9 (18:11):
I agree with you there, Patrick, I don't Yeah, I
don't think Leo Messi is coming home to play for
a pro team in Argentina. Another big factor that Melay
could change is that MELA is trying to change the
structure of these clubs in Argentina into more private enterprise.
Right now, a lot of the clubs, their leadership is
elected by the fan base, and so that limits the
(18:34):
amount of say foreign private investment that can go into
these clubs and juice up contracts. So we've seen in
Brazil there was a reform in their soccer leagues to
make make it easier for teams to have foreign investors,
and that's helped to attract, retain and recruit higher quality talent.
So I don't know if the the World Cup starting
(18:56):
roster is going to come back to one of the
sorries anytime soon, but certainly the stronger Paeso is going
to help attract more players in the near term after
really decades of the talent just immediately leaving either a
MESSI left Argentina when he was twelve years old. Many
of these players leave when they're twenty one, twenty two
(19:16):
years old, so the fact that some are coming still
relatively in their prime is welcome news. But you're right,
this is a very early trend. It's very incipient, and
there's a lot of questions about whether Melay can sustain
his economic policies, particularly the currency FX policies that are
really a big part of Argentina's negotiation with the International
Monetary Fund right now.
Speaker 8 (19:37):
I mean, Boca Juniors is going to be playing in
the FIFA Club World Cup this year, so signing those
a few of the big players like Alan Vlesco who's
playing in the MLS and now he's playing for Boga Juniors.
Do you think these new signings are going to help
them on that world stage.
Speaker 9 (19:54):
Yes, these players especially, I think when I know we
mentioned Boca Juniors, but I think River Plate stands to
benefit the most just because of their these two players
in their prime joining an already pretty strong club. So
I think you are going to see the Argentine professional
(20:14):
clubs compete at a higher level at the international stage,
which is where they were about. You know, two decades
ago there were friendlies between Boca Juniors and some of
the Spanish clubs where Boca either won or pulled a draw,
which at the time was unheard of. It just never
you could never conceive of that. So it would be really,
(20:35):
I think special for Argentine clubs that are considered you know,
going to an Argentine football game is an incredible experience,
and to see that happen on an international stage like
the FIFA Club Cup would be really really special. But
I can confirm, and I know people like Matt Damon
can confirm that going to a Boca Juniors game or
a River Plate game is one of the most phenomenal
(20:57):
sports experiences any fan could ever have. And I'm not
talking about a championship. I mean you can go to
a regular season game and it's nearly a religious experience.
It's really incredible, the passion the fans bring every night.
Speaker 5 (21:08):
Patrick, I have to ask this. I mean, we have
you on the phone here, you're dialing in from Buenos Airas,
and you know what is sentiment like on the ground
in Argentina right now? I mean it's got to be positive.
I mean, through all the austerity measures, that Malay has
passed through in the last year. You know, he's still
you know, it seems that the populace is still very
very pleased with him, that they're still very much on
(21:29):
his side and in support of him. You know, talk
to us a little bit about you know, what you're
seeing on the ground.
Speaker 9 (21:35):
Yeah, Melay is still enjoying a relatively high level of
approval rating, especially when you think about what you the
measures you outlined, a historic austerity campaign that saw the
cost of living increase significantly in Argentina. Milee still has
approval ratings around forty seven percent. Those of stayed stable
for several months at this point, and they're really He
(21:59):
only stays to benefit in the upcoming months as the
economy is expected to continue recovering from a pretty brutal recession.
But the government published economic activity data that showed five
percent annual growth in December. That's one of the highest
figures in years. So Malay has a stable exchange rate,
lowering inflation, and an economy that's recovering with pretty stable unemployment.
(22:23):
At the moment, the wind is at its back his
back for the economy. Melay is benefiting, but he's dealing
with some say some issues on the sidelines that investors
would like him to, you know, get off stop speaking about.
But if Malay can focus on the IMF program and
(22:44):
economic recovery in unwinding some of the currency controls and
other restrictions that he inherited from the previous government, you know,
he could be looking at a big victory when Argentina
gets to midterm elections in October, and that would help
him advance his pro mark agenda even more.
Speaker 2 (23:01):
I know we're running out of time, Patrick, but I
want to try to kind of put a bow on
it about Malay before he had taken over, with his
economic policies, obscure markets. We're talking like Paraguay and Bolivia
because we all know that they're like super soccer markets.
They were luring the Argentine players away before Malay came in.
Speaker 9 (23:27):
Absolutely, we had inflation reach nearly three hundred percent last
year as Mila was trying to implement some of the
necessary cold medicine Argentina needed because his predecessors were simply
spending too much money and printing too much money, and
that resulted in sort of a carving out of the
soccer talent in Argentina, where some players felt forced to
(23:49):
go to much smaller markets because they have more stable currencies.
It really is unimaginable, the change from a just a
couple of years ago when players were going anywhere they
could because they can't get paid in dollars here. They
have to be paid in paesos. You know, the currency
was losing. It was, you know, has lost since I've
(24:13):
arrived in twenty eighteen, the peso has lost ninety five
percent of its value. So we've had some of many
of the bills, the cash bills that I first used
to have when you got to the ATM here, they
no longer exist because the government stopped printing him They're
worth nearly nothing. So the impact that Melee is having
(24:34):
on the soccer league is really a reflection of his
ability to stabilize the economy. But there's a lot of
questions about whether his policies are sustainable in the near
term or after this year because Argentina has midterm elections.
But also he still has a whole lot of homework
to do on the economy when it comes to, you know,
showing up the central bank making sure they have the
(24:57):
stability to keep the Paso on a more stable path.
So there's a lot of questions about his economic policies,
but for now he's benefiting from a lot of social support.
People like this economic program. They feel like the worst
is behind them in terms of the recession and the
biggest of the austerity measures, and it looks like me
(25:17):
Lay could be heading towards a big victory when we
get to those midterms later this year.
Speaker 2 (25:22):
Buenos Ares Bureau Chief Patrick Gillespie, thank you so much
for joining us on the Bloomberg Business of Sports. We
really do appreciate it.
Speaker 9 (25:30):
Thank you so much.
Speaker 2 (25:31):
Our thanks to Bloomberg Buenos Aires Bureau Chief Patrick Gillespie
for joining us. Up next, Carla Food joins the conversation
as we talk sports, gambling and bring in the founder
and CEO of Gambling dot Com group for Damian Sasaur
and Vanessa Verdomo. I'm Michael Barr. You're listening to the
Bloomberg Business of Sports from Bloomberg Radio around the world.
Speaker 1 (25:59):
This is Bloomberg Business of Sports from Bloomberg Radio.
Speaker 2 (26:04):
Thanks for joining us on the Bloomberg Business of Sports,
where we explore the big money issues in the world
of sports. I'm Michael Barr, along with Scarlettfu and Damian Sasaur.
Gambling dot Com Group, trading under the ticket symbol gamb
is a leading sports gambling affiliate working as a liaison
between the growing sports gambling public and the popular sportsbooks
(26:28):
and regulated online casinos. Gambling dot Com Group's founder and CEO,
Charles Gillespie joins us now to talk about the platform
and about the sports gaming landscape. Charles, Welcome to the
Bloomberg Business of sports.
Speaker 6 (26:42):
Great to be here, guys. How can I help?
Speaker 2 (26:45):
Well, you're talking to a degenerate gambler, But I love Listen,
I love online gambling. I don't get carried away with it,
and I think, and I'm going to start right from
the beginning. That's the key to the whole Google. Lot
to talk about it, but that's the key to the
whole thing. Nothing wrong. If you want to go and
gamble your five ten dollars and put it on the
(27:07):
Detroit Tigers, you go ahead.
Speaker 6 (27:10):
That's absolutely right.
Speaker 3 (27:11):
I mean, you know, the industry in the United States
wasn't really regulated in to any meaningful extent until about
twenty eighteen, when the Supreme Court decision allowed states to
start regulating and that's brought the business out of the shadows.
You know, it's not like people weren't betting online prior
to twenty eighteen. It was just entirely offshore. So you know,
(27:32):
in order to have proper safeguards for people and identify
problem gambling early, it's critical that the activity actually be
regulated and on shore.
Speaker 6 (27:44):
Otherwise you've got no visibility into it and you.
Speaker 3 (27:47):
Can't help these people, which of course, you know, problem
gambling is is it's a problem for the for the industry.
It's everybody's problem, and nobody wants to, you know, see
these people struggle, so it's a critical focus area for
the whole indust that's.
Speaker 2 (28:00):
Right, Scarlett. I was caught up in the Kingman Islands
era Man, you know, before it was regulated. Thank god
it's regulated now.
Speaker 4 (28:09):
Scarlett Charles, you've come on Bloomberg Radio in the past
to tell us how the online gambling industry is pretty
resilient to the swings of the economy, the ups and downs.
For example, in the UK, gambling growing at more than
eight percent a year when GDP is forecast to be
sub one percent for a second year. Talk about the
growth of online gambling in the US, especially sports betting,
and the seasonal pattern of that growth. I'm wondering how
(28:31):
much of a correlation there is with calendar events like
the super Bowl in February or March Madness, or the
NBA Finals in June or the World Series in October.
Speaker 3 (28:40):
The growth of the industry in the US absolutely is
driven in part by the sporting calendar. The super Bowl,
of course, the biggest individual betting event of the year.
March Madness and aggregate would have a lot more handle
than the super Bowl, and that's obviously because it's many
more events, it's not just one event. Another big driver
(29:01):
in the US is every time there's a new state
which goes live. So at this point, Missouri.
Speaker 4 (29:07):
That's a one time thing.
Speaker 3 (29:09):
Well it's a one time thing, but then it kind
of permanently expands the tam right, you know, there's a
kind of rush of activity when the new state goes live,
all that pent up demand. You know, people that have
been waiting to register accounts go out and set up
their accounts, and then it quiets down a bit. But
then you're going to have, you know, fifteen twenty thirty
(29:29):
years of fairly reliable growth. You know, you just look
at the UK, as you pointed out, they regulated online
gambling in two thousand and five and it's still growing
by nearly double digit rates, is right, And you know,
with our business, we're making more money in the UK
than we have ever made before, despite the fact that
this this business has been around for some time. Just
(29:52):
to clarify for your for all the listeners out there
at gambling dot com, it's not actually an online gambling site,
despite the names.
Speaker 6 (29:59):
It's a a.
Speaker 3 (30:00):
Website to help people find the best places to play online.
So whether it's sports betting or online casino, there's a
lot of different options out there, especially in the US.
You know, every single state is different.
Speaker 5 (30:12):
Charles, you're the group CEO of gambling dot Com group,
but you started the company in two thousand and six.
You're an American, you went to UNC Chapel Hill, but
you're living in Europe. You're actually living in Monte Carlo,
one of my most favorite places. They know me over
there by name, and I really just wanted to ask you,
you know now that gambling has really arrived here in
the United States. I mean, you're really well positioned having
(30:32):
lived there for a very long time to see how
it affected Europe before the US, right, because gambling was
legal there before us. So talk to us a little
bit about what comes next for the United States of
America for sports gambling here in the US. If you
had to look out over the next say, two three,
five years, you know, do you expect every state to
legalize sports gambling? I mean, is it unique to the
US that you know it's taking us this long to
(30:54):
get there. I'm just curious to hear your thoughts.
Speaker 3 (30:55):
Yeah, great questions, and I'm very happy to talk about that.
We have a bit of a unique perspective in this
because I grew up in the States. I grew up
in North Carolina. I went to UNC. When I was
graduating from UNC, I wanted to start a business in
the online gaming industry. But the industry didn't exist in
the United States.
Speaker 4 (31:11):
It wasn't ahead of your time.
Speaker 6 (31:12):
Yeah, you just couldn't do it here.
Speaker 3 (31:15):
So I left and we ended up building one of
the biggest businesses in the industry in Europe. And you know,
on the back of the power of the UK and
and and you know other European markets, Ireland, Sweden, Italy,
and Germany. I mean, it's you know, there's a lot
of regulation. The industry was regulated first in Europe. You know,
the UK has been the biggest regulated online gamiling market,
(31:37):
you know, basically until now. It still is bigger than
any individual US state right now, the US and aggregate,
if you count you know, all the states, it's bigger
than the UK. So that has really set the tone
and for the whole industry. Right you know, a lot
of the technology companies, marketing companies, data services companies, they're
all European. Actually, biggest online gaming company in the world
(31:58):
is flutter based in Dublin. But of course you've got DraftKings,
you know, in Flutternow owns fan Duel, And you've had
this coming of age in America of this industry finally,
but because it was so late to the party, it's
been this just absolute mad rush for everyone in the
US to kind of catch up. But you know, you
(32:18):
talk endlessly about you know, American technology hegemony and you know, Google, Apple,
every Magnificent seven, all this stuff. Right, It's it's quite
rare that you can find an example of Europe leading
in an in any area of technology. But they really
are truly ahead of the United States still when it
comes to everything related to the online gambling industry. And
(32:41):
that's not a slight that you know, some of the
big American suppliers or operators, which are amazing businesses. But
you know, if you just look at the balance of
the industry, it is still fundamentally not led by the
United States. Now, five or ten years from now, anything's possible.
You know, I think the industry is going to continue
to grow up in the US. The center of gravity
(33:01):
of the industry in terms of you know, where is
the heat, where is the investment, where's the growth? That's
clearly been the United States since twenty eighteen. You've got
thirty plus states now with sports betting, You've got a
handful of states with these online casino games, and that
still works. It works because they have both sports betting
(33:22):
and the online casino games, which kind of prop each
other up. It's a one plus one equals more than
two sort of situation.
Speaker 4 (33:29):
Charles, You've made a number of acquisitions in the past year.
In April last April, you bought Excelmedia sports betting and
gaming assets in Europe and Canada. More recently, in December,
you bought odds Jam, which has been described as a
Bloomberg terminal for sports betters, which I like that comparison
a lot. What other capabilities are you looking to grow
through purchases rather than organically.
Speaker 6 (33:51):
So the Heart and.
Speaker 3 (33:52):
Solar business is a affiliate marketing business for the online
gambling industry.
Speaker 6 (33:57):
It's an incredible business. We drive a.
Speaker 3 (33:59):
Lot of our traffic from Google Search, natural search. We
know we buy a little bit of media, but it's
fundamentally a business that drives its revenue from natural search,
and that's a very high margin business. But you know,
we're a publicly traded company and as we think about
our future is a is a publicly traded company that
(34:21):
that revenue from the affiliate business. It can be a
little bit volatile, you know. Frankly, it's a phenomenal business
and extremely cash generative, but as a listed company you
got to, you know, manage the earnings core to quarter.
And we like these subscription revenue businesses. So when you
think about odds Jam, you've got a highly predictable B
(34:45):
two C subscription business. And they also have a B
to B side of that that business called Optic Gods.
They sell that to you know, that's really the Bloomberg
terminal if you will. That's the more sophisticated product which
they actual we sell to the online gambling operators themselves
so that they can manage their risks. You know, they
want to make sure they're on the right side of
(35:06):
every market. They're not, you know, too far off of
the market and everything. Both of those businesses. The revenue
there is more predictable, right, it's longer term contracts, it's
it's it's it's just we can forecast that with a
higher degree of precision. So when you mix that into
our overall revenue profile, it gives us, you know, a
(35:27):
greater kind of control quarter to quarter to see where
we're going to land. It just makes it works well
in the public company context. But at the same time,
their margins are actually even higher than our margins are
already very high margins. So we love that acquisition. It's
gone over really well with all of our investors. That
really ticked all the right boxes, and there's a bright
(35:47):
future for that.
Speaker 2 (35:48):
Now. To give you how much money is out there,
we're talking last year about one hundred and fifty billion
dollars in the industry online gaming alone. Now this year, yes,
only Missouri is expected to approve it, but it's going
to grow because we did a story recently Texas Governor
Greg Abbott, who was totally against it when it first
(36:12):
came out, and recently said, you know, maybe this isn't
such a bad idea. So I see a lot of
growth in this.
Speaker 3 (36:21):
The only thing we know for sure right now in
terms of new state launches is that Missouri will launch.
You know, that's already been voted on. That was a
referendum in November, and in the terms of that referendum,
they have to launch by December. So that's one hundred
percent coming and is incremental to our guidance because we
don't put new state launches in our guidance until the
(36:43):
date of launches is crystal clear. But all of the
other states are, you know, still looking at it right now.
So a lot of these state legislators they meet in
the first couple of months of the year, so a
lot of these folks are in session right now, including Texas.
Speaker 6 (36:59):
Texas every other year, but they're in session now. They're
looking at it.
Speaker 3 (37:03):
There's tons of bills both on the sports betting and
I gaming side in process now that have been filed.
It is certainly my view and that of the rest
of the senior people in the industry that will get
a few more things through this year. It's always hard
to say exactly what, but you know, I'd be shocked
(37:23):
if we don't get you know, two or three sports
betting states and two or three I gaming states.
Speaker 6 (37:29):
And but you know, it.
Speaker 3 (37:30):
Takes it can take six, nine, twelve months for them
to launch, right so even if they get the legislation
finished in the first half of the year, they may
not launch until twenty twenty six. And you know, of
course with these new as we discussed these new state
launches being kind of big moments of business for us,
we don't add it into our guidance until we're know,
you know, exactly when it's going to launch, because you know,
(37:52):
we need to show where that which quarter of that
revenue is going to fall into.
Speaker 2 (37:56):
Charles Gillespie, Oh, my goodness, Grace, as we talk in
the game, and I just said I was out before
we came into the studio, as you know, I said,
my goodness, are you ready, Michael, I said, yeah, that's
like the rat talking about the cheese man talking about gambling. Here.
Charles Gillespie, thank you for coming on the Bloomberg Business
of Sports. Gambling dot Com CEO right here in studio.
(38:19):
Thank you, sir, my pleasure. A special thanks to Charles
Gilaspie for joining us. He is the founder and CEO
at Gambling dot Com group, and thanks to you for
joining us. For my colleagues Damien Sasauer, Scarlettfoo and Vanessa Berdomo,
I'm Michael Barr. Tune in again next week for the
latest on the stories moving big old money in the
(38:40):
world of sports. You're listening to The Bloomberg Business of
Sports from Bloomberg Radio around the world.
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