The media company Fox Corp. controlled by Rupert Murdoch and his family is buying 5% stake in Toronto-based gaming giant Stars Group Inc. Fox will pay $236 million to launch its own sports wagering platform reveals Rafi Ashkenazi, Chief Executive Officer of Stars.
This investment is by far one of the biggest from any media in the burgeoning U.S. sports-betting market. Post the Supreme Court rule allowing states to legalize sports betting in the U.S several media companies and sports leagues have ventured in exploring ways to capitalize the betting market.
With this deal in place, Stars Group gets an exclusive license to use certain Fox Sports trademarks for up to 25 years. The betting company has also given assurance of spending decent amount each year to advertise on Fox Sports outlets. PokerStars will also be operated by Stars Group.
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Rafi further highlighted that the companies will jointly launch Fox Bet later this year. They have designed two products that will be offered to the users to stake a claim in the growing world of online betting. One of the two will be free to play where customers can win cash and prizes for predicting the outcome of sports games. While the other would give players a chance to place real money wagers in states with regulated online betting.
The CEO is of the opinion that free-to-play games are doors to drive customer acquisition and engagement. Such games are an effective way to convert customers to real money games.
Fox Sports CEO Eric Shanks in an interview said that 10 years down the line Fox Sports shall hold the right to acquire up to 50 percent of Stars Group’s U.S. business. It is estimated that by 2025 domestic sports betting, online casinos and poker could become a $9 billion revenue market with wagers, sponsorship and advertising all put together.
