FOX Bet Sportsbook has become the latest casualty in the evolving world of online sports betting, but its departure from the market does not come as a surprise.
Flutter Entertainment and Fox Corporation joined forces more than four years ago to give mobile sports betting a try. But on Monday, the partners — who have had an acrimonious relationship since just after they announced their partnership in May 2019 — went public again to announce that their product had ceased accepting wagers and would shut down completely by August 31.
There was no official comment from management at either company. The last time there was any substantial commentary about the future of FOX Bet was a Flutter call with analysts on March 2 to discuss preliminary results for FY 2022.
At the time, CEO Peter Jackson said the company was still evaluating what to do with FOX Bet but conceded “for these subscale operators, it’s very difficult to make money in [this market], and there is a long tail of operators that are probably struggling as FOX Bet is.”
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No Official Migration Plan to FanDuel
FOX Bet is currently live in four states — Colorado, Michigan, New Jersey, and Pennsylvania. It launched in New Jersey and Pennsylvania within days of each other in September 2019, then followed up with launches in Colorado in May 2020 and Michigan in January 2021.
Although Flutter also owns FanDuel, the most popular sportsbook in the US, it did not automatically migrate its soon-to-be former FOX Bet customers onto FanDuel. More than likely, that’s because the customer accounts are on separate platforms.
Despite there being no official migration plan, an FAQ document released in tandem with the shutdown announcement told FOX Bet players that they could place immediate wagers on FanDuel Sportsbook as “an alternative to FOX Bet,” where available.
According to the FAQ, FOX Bet customers were told that they will continue to have access to any funds on the platform until August 31. After that, they will need to use their PokerStars or PokerStars Casino app to access the funds. The login information will remain the same.
FOX Bet customers without a PokerStars or PokerStars Casino app were encouraged to download it to keep access to their funds. Customers not interested in downloading the app were advised to call customer service.
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Fox Corp Still Has Option for FanDuel Stake
Flutter and Fox were widely expected to go their separate ways and fold FOX Bet this summer.
Last November, an arbitrator in New York said Flutter and Fox could end their partnership in August 2023. Fox Sports, a Fox Corporation subsidiary, launched FOX Bet with The Stars Group (TSG) in May 2019. Flutter acquired TSG that October.
The Judicial Arbitration and Mediation Services (JAMS) arbitrator also ruled that Fox could acquire an 18.6% stake in FanDuel. But the price of the stake would be based upon a valuation of $20 billion, not $11.2 billion, as Fox had argued.
The ruling meant Fox would need to pay $3.72 billion with a 5% annual escalator for the stake, which was worth about $4.1 billion at the time.
Fox said it would “continue to hold its option to acquire 18.6% of FanDuel,” and added that it currently holds a 2.5% stake in Flutter. Fox also announced that it would “retain future use of the FOX and FOX Bet brands, including FOX Bet Super 6,” and that it plans to launch a new FOX Super 6 game “later this summer.”
Meanwhile, Flutter said it is still planning to have an IPO for FanDuel later this year. Its shareholders approved a plan to list FanDuel in April.
FOX Bet joins the likes of Fubo Sportsbook, MaximBET, and TwinSpires on the list of defunct sportsbooks in the US.
PlayUp is a new addition to that list after regulators in New Jersey shut the online sportsbook down last month for compliance violations. Regulators in Colorado agreed on July 27 to a request by PlayUp’s CEO to mothball its sportsbook there — specifically, by placing it into “maintenance mode” — where it cannot accept wagers.
