00:00Let's get to BetMGM. Their reporting numbers in the first quarter seemingly indicating
00:04that the struggles could be partially due to prediction markets coming on the scene.
00:09Does that seem accurate?
00:11Yeah, definitely. BetMGM, interestingly enough, because they're owned by MGM, a casino company,
00:18they have not been one of those companies like FanDuel and DraftKings that wants to do its own
00:22prediction markets. Because they're owned by the casino company, the casinos are really against
00:26prediction markets. So it has not launched its own product. And while BetMGM as well as DraftKings
00:32and FanDuel have been vocal about prediction markets, not necessarily stealing high value
00:36customers from them, what BetMGM did come out and say this week is with the emergence of these
00:42prediction markets, which have essentially acted as new sports books and intensified the competition
00:47in the marketplace, they're essentially wrestling with more marketing spend from competitors driven
00:53up the amount of promo cost and advertising cost in the space in general, especially when these
01:02companies like College and Polymarket aren't paying the same fees and taxes. But MGM says that's actually
01:07made it a lot harder to compete marketing wise, which is one of the reasons that it's trimming its
01:12profit and revenue goals for the rest of the year just a little bit as it kind of refocuses marketing.
01:18BetMGM notably has been really kind of focused on shifting away from sports betting, as well,
01:23as it's big driver to more online casino where, you know, it thinks it has an advantage with
01:28brand, which means more marketing if you're in a state like Michigan, New Jersey, Pennsylvania and
01:34West Virginia, where BetMGM is legal with online casino, you might see more promos and dollars spent
01:41on sports betting there just because those states also have that other key core product, which is how
01:46BetMGM is going to try to be more efficient. So pretty interesting to hear that, you know, prediction
01:49markets might not necessarily be taking customers away, but they are definitely changing the
01:54competitive dynamics among the largest sports betting operators. And, you know, in turn, that
01:59trickles down to the customer. Eventually, in some way, you know, BetMGM is going to be hoping that
02:04eventually the Supreme Court rules against these prediction markets. But in the meantime, they're
02:08focused on kind of redistributing these marketing dollars and having a better Q1 and Q2 coming ahead.
02:14Yeah, if you're good.
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