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The Holy Grail

Microbetting will produce more revenue for sportsbooks, but how will it be promoted?

The Holy Grail

The microbettor will have a chance to wager whether Aaron Judge will hit a home run while he’s in the on-deck circle, or even when he’s down 0-2, when the odds will soar against him hitting it out

Critical mass has always been the key to success for sports betting. If you can only make a few wagers on the results of the entire game/match, you might as well be betting the horses. And we know that horse racing is a dying sport for that exact reason. They haven’t figured out how to allow betting at the quarter pole or any other length of the race, or even of the margin of victory, so the win-place-show and all the attendant parlays is about it.

While sports betting has a few more results-driven wagers available, the real prize is figuring out how to bet in-game or in-running, whatever it’s called. When you could predict whether the next pitch will be a strike or a ball, or even a fastball versus a curveball, you’ve drilled down. When you have analytics to place accurate odds on whether the next play will be a run or a pass, you’ve got something. Or if you could take a flyer on whether the basketball team will run a play resulting in a layup or a 3-point shot, you might be building something strong.

So far, in-game wagering hasn’t taken off in the U.S. Much of it could be the result of lagging technology. Either the operator doesn’t trust the technology to offer in-game betting or the player gets frustrated with the lag time between deciding to make the bet and actually pulling the trigger. Seems that more often than not, the odds change dramatically in the other direction or the bet gets taken off the board. It’s frustrating for both parties.

In addition, in-gaming betting is largely limited to the shifting odds on the results of the entire game. For example, in soccer, if a team that started the game at +200 scores the first goal, the odds of them winning the game probably drops to even money or even -120, given the paucity of scoring in many soccer matches. But try to find a bet that predicts which team will make the next turnover. In most cases, the U.S. for sure, it won’t be there.

But there are dozens of companies in pursuit of the “holy grail,” and the ones that succeed will do very well. SimpleBet is a company that is a contender. Mark Nerenberg, the company’s chief commercial officer, explains why it’s important to understand the dynamics between this “micro time frame in-play betting.” While he says that this kind of wagering hasn’t been that prominent in the European sports betting community, he believes it will be different in the U.S. “because of the cadence of the U.S. sports and the significance of these micro events within the sports.”

He says that there is always significant time to place bets on these micro events, and that those events are already highly recognized by fans.

“They have opinions on whether one team is going to stop the other on third-and-one, or whether the next hitter will be able to deliver in the clutch,” he says. “Those things are already ingrained in the U.S. sports.”

Nerenberg says the technical expertise compiled by SimpleBet over the past three years has made a huge difference.

“When you’re taking these microbets, you have to know the exact state of the game at all times,” he says. “We got very good at defensive logic, where we identified all these situations that we know would be wrong. Then the other challenge was marrying that with fully powered machine learning models that could work with that defensive logic to reprice the market. Dozens of markets are being created with every pitch, every play, and we’ve gotten really good at the machine learning engineering aspect of microbetting.”

The benefits of microbetting are many, according to Nerenberg.

“Starting with the users,” he says, “it’s that short interlude and on-demand. That’s where the internet is going now. Instead of just waiting for a three-hour game to be over for a result, they can jump in and out and make bets the entire game. For the users, it’s a higher level of engagement.

“For the operators, it’s high turnover, good monetization, similar to iGaming. But this is built on underlying entertainment that people are already engaged with. For example, if Aaron Judge is on deck, will he hit a home run when he gets up? Or even better, if he’s down 0-2 in the count, the odds just got more attractive for a huge payout for the bettor.”

While the U.S. sports seem to be more suited for microbetting, similar situations exist in such games as golf and cricket. And as the technology improves, and bettors aren’t shut out of bets that have a rapid resolution, microbetting should thrive.

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