Churchill Downs Looks To Switch Up Sportsbook Operations

  • Churchill Downs wants to switch from BetAmerica Sportsbook to Kambi Sportsbook.
  • They are in talks with GAN to make this move possible which includes nixing SBTech’s product for GAN’s GameStack application.
  • The odds of this change happening are relatively high, as Churchill Downs holds all of the cards.

LOUISVILLE, Ky. Churchill Downs currently has a partnership in place with BetAmerica Sportsbook and an SBTech platform but they are looking to make some changes by way of switching companies.

Churchill Downs has drawn up a conditional deal that would allow them to change business partners from BetAmerica Sportsbook to Kambi Sportsbook and an SBTech platform to GAN’s GameStack platform.

There are a few reasons why this latest development is taking place.

Why The Switch?

Events that have occurred throughout their relationship have left Churchill Downs less than enamored with the services provided by SBTech and BetAmerica.

For one thing, DraftKings owns SBTech.

BetAmerica and DraftKings are competitors in the sports betting market leading to a conflict of interest where business done with BetAmerica would help to profit a rival sportsbook.

Presently, BetAmerica and SBTech have not fared well, having made little to no progress in the industry in terms of profit margins compared to other online sportsbooks.

Competing numbers show other businesses have done far better. Not only that, but the sportsbook was down for a number of weeks in April, sustaining a nationwide outage with their online and mobile outlets.

What GAN Will Offer?

GAN will provide Churchill Downs with its GameStack product.

This product allows for a broader fan base when dealing with the number of member accounts they can acquire without issue.

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Kambi Sportsbook and GAN’s GameStack are a packaged deal in the current draft of a contract that’s been drawn up.

In their quarterly reports, GAN listed a Tier One client that was in the agreement principle phase.

However, because no actual contracts have been signed, nothing has been set in stone allowing for changes to be made.

It is rumored that this Tier One client is Churchill Downs. The report also states that the new client would see revenue profits in the sum of $300-$400 yearly by the third-year mark of being in business with GAN.

“2020 has been a landmark year for GAN, and our first quarter 2020 results were in line with expectations,” said Dermot Smurfit, CEO of GAN. “During a time when the global pandemic was causing a great deal of tragedy and economic turmoil around the world, we were fortunate not only to continue to operate business as usual due to the online-only nature of our business.”

What Lies Ahead

Even with the Coronavirus Pandemic, GAN was able to secure $7.7 million in revenue for their first quarter, down by only $1.9 million from 2019’s first quarter.

That’s incredibly well considering the circumstances.

Their GameStack product and Player Account Management (PAM) is very flexible and can allow for numerous software styles from varying sportsbooks including Kambi.

Churchill Downs would be able to launch their new operations in Illinois, New Jersey, Pennsylvania, Tennessee, Michigan, and Indiana with both retail and mobile betting platforms should this deal be finalized.