Jason Robins, CEO of DraftKings, told Jim Cramer of CNBC that prediction markets aren’t discouraging people from betting on sports, emphasizing that the two offer distinct services.
“You’ll see what I mean—it’s night and day—just go and spend five minutes looking at the products,” Robins remarked. “I wouldn’t consider the quantity of markets or even the pricing to be competitive with what we do.”
Robins cited markets in the United Kingdom and Western Europe, where both exchange-based and conventional sports betting are available. He stated that “exchange products are typically low to mid single digit percentages of share of the total industry” in those regions, implying that there isn’t much volume migration from the sports books.
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However, DraftKings is entering the prediction markets on its own. In addition to announcing that it would release a mobile application that enables users to wager on outcomes in a range of industries, including banking and entertainment, it purchased prediction platform RailBird last month.
Prediction markets offer DraftKings a chance, Robins said Cramer, particularly in states like Texas and California where traditional online sports betting is prohibited. He did, however, add that his business will keep concentrating on sports books in jurisdictions where it is lawful.
Regarding prediction markets, Robins stated, “I think the reality is that at least for the near term, it looks like the momentum is here.” “They intend to remain here. In light of that, I believe we must take part and have the resources necessary to succeed.
Shares fell more than 5% in extended trade on Thursday after the company released its earnings and reduced its full-year sales forecast.
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What did DraftKings CEO Jason Robins say about prediction markets vs. sports betting?
He said they’re completely different services and not in competition.
How big are exchange-based betting markets in Europe according to Robins?
They make up only low to mid single-digit percentages of the total industry.
Why is DraftKings entering the prediction market space?
To explore new opportunities, especially in states where sports betting is banned.
What recent acquisition did DraftKings make related to prediction markets?
It purchased the prediction platform RailBird.
How did DraftKings’ stock react after its latest earnings report?
Shares fell over 5% in extended trading after lowering its full-year sales forecast.
