The lack of low-latency streaming in sports betting causes billions in lost handle, according to Jed Corenthal of Phenix.
Corenthal, the chief marketing officer of the real-time streaming technology platform, said current live streaming is much different than real-time streaming.
Viewers are no longer tolerant in delays that can be upward of a minute, he said. And sports betting operators shouldn’t be either as there are multiple markets that could be bet by utilizing real-time streaming.
LSR: The average sports bettor might not consider how latency can factor into games they’re betting live. How big of a difference can those seconds make?
Corenthal: Delays of even a few seconds can make all the difference when betting on a live game, especially when it comes to prop bets.
Imagine watching a football game and you want to place a quick bet on the coin toss result or whether or not the next play will result in a touchdown. If you’re watching a stream even five seconds behind broadcast, that means you’ve already lost out on a window to place that bet.
And in turn, sportsbooks have lost out on that revenue. A few seconds is the difference between a bet made and money lost.
Earlier this year, we tested the latency across different platforms during the Super Bowl and found that viewers were experiencing up to 45 – 55 second delays. With that much of a gap, the average sportsbook has already left a significant amount of revenue on the table.
LSR: In-play betting is already massively popular where it’s available. How much bigger could it get with real-time streaming?
Corenthal: Phenix has a very different view of the potential for in-game betting. Examples of the types of in-play betting that exist today are betting that a team will score more points in the second half of a football game than they did in the first half, or that a player will hit more three-pointers in the second half of a basketball game. But imagine if bettors could bet on whether the next pitch will be a strike or if the next pass will be a touchdown.
The amount of handle sportsbooks will generate once real-time streaming technology is implemented will grow by the billions. There certainly are a plethora of factors holding the US back, but a lack of real-time streaming technology is equally impacting the States. Game live streams will only continue to grow in popularity as experts believe fans won’t be able to attend games physically for some time.
As these platforms start to experience a surge of viewers, in-play betting won’t bode well if the technology doesn’t have the bandwidth to support these larger audiences in the first place.
LSR: What are the kind of in-play betting markets sportsbooks are missing out on without this real-time feed available to everyone?
Corenthal: Sportsbooks who aren’t using real-time streaming technologies are missing out on a ton of markets since they’re limiting the number of prop bets within a game.
For example, in baseball, sportsbooks could be leaving money on the table with every thrown pitch. If the stream is in real-time and is synchronized across viewers and without latency – meaning that all users will be watching the stream at the same time regardless of location, device or connection – then bettors would have the chance to bet on whether the next pitch will be a strike, ball, or base hit.
But that’s not possible in live streams riddled with delays. Ultimately, sportsbooks are missing out on all of those quick, betting opportunities without real-time streams.
LSR: Regulators in New Jersey and Nevada recently approved betting on a slew of esports as well as the eNASCAR iRacing Pro Series, though neither approved in-play betting on any of the events. How much does latency play into that decision?
Corenthal: While there are extensive legal and lobbying influences on many of these decisions – and each varies state to state – latency will play a role in terms of the delay from screen to device, but also if the streams are out of sync, which is another form of latency.
If there is significant latency across a live stream it’s nearly impossible to successfully take advantage of in-play betting. For instance, with the eNASCAR iRacing Pro Series, drivers are all across the country, so you have over 30 video streams coming in that could be delayed.
When a tenth of a second could be the difference between first and second place, there may be too much risk around delays for in-play betting with current technology. When real-time streaming tech solutions are implemented widely, I believe regulators will start to see the value prop bets provide to all parties involved.
LSR: Providing real-time feeds to everyone watching regardless of device and connection is great in theory. How does it actually work? How can Phenix account for an event that gets a surge in viewership that wasn’t expected?
Corenthal: Delays are often a result of a popular technology protocol used in today’s sports streaming platforms – HLS.
It’s widely used among sports streaming platforms due to its ability to support larger online audiences, but HLS streams come with significant latency. Phenix uses a standard-compliant protocol known as WebRTC, but we have rebuilt it from the ground up so it could scale to millions of users while maintaining the same sub-half second latency.
At Phenix, our co-founder and Chief Software Architect Stefan Birrer developed this delicate balance with our platform. Being able to detect a “flash crowd” – when an event suddenly gains thousands of new viewers – we’re able to ramp up the number of streaming servers in a matter of seconds to make sure all viewers are receiving a synchronized video feed with the same sub-half-second latency.
A synchronized stream guarantees that all viewers watching are at the same point in the game – even if that point is a second or two behind broadcasts.
