Key Takeaways
- Polymarket secured a three-year partnership with MLB valued at $150-300 million, becoming the league’s Official Prediction Market
- Traditional sportsbooks are negotiating expanded category rights with additional payments to prevent prediction market platforms from taking market share
- For the first time since 2021, the NFL’s sports betting category remains available after FanDuel and DraftKings declined higher data pricing
- Sports betting sponsorships have become a buyer’s market, with teams finding it difficult to secure multiple betting partners
- Team-level prediction market partnerships are anticipated once league agreements are fully established
A significant competition is emerging between established sportsbooks and prediction market platforms for valuable sports sponsorship opportunities.
Last month, MLB joined the growing list of major sports organizations embracing prediction markets. The league announced a sponsorship partnership with Polymarket that sources estimate at $150 million to $300 million across three years.
The agreement also featured an integrity-focused component involving the CFTC. Through this partnership, Polymarket has become MLB’s Official Prediction Market.
FanDuel currently maintains its position as an Official Sports Betting Partner of MLB through a co-exclusive deal. However, the emergence of prediction markets as sponsors is diminishing the exclusivity and perceived value of these traditional arrangements.
Polymarket has also established relationships with the NHL and Kalshi, while securing additional partnerships with MLS and UFC.
Traditional Operators Move to Protect Their Investments
Established sportsbook companies are actively renegotiating with their league and team partners to widen their category exclusivity. Their objective is to block prediction market platforms from gaining additional footholds in their domains.
Eric Foote, founder and CEO of VIG Partners, a consultancy engaged in these negotiations, verified these efforts are underway.
“The legal sports betting operators are going back to their teams specifically and/or league deals and trying to expand their category definition,” Foote told Gambling Insider.
According to Foote, broadening these rights generally requires supplementary financial compensation. The amount varies based on the specific league or partnership.
“These groups are working very hard right now to defend their turf,” Foote said.
Meanwhile, the NFL’s sports betting sponsorship category has become available for the first time in three years. Both FanDuel and DraftKings reportedly rejected increased pricing demands for official league data from Genius, which serves as a requirement for NFL partnership.
Sports Business Journal reported this development earlier this week. Industry observers expect both the NFL and NBA will likely secure prediction market partnerships in the near future.
Prediction Markets Poised for Team Partnerships
The overall landscape for sports betting sponsorships has transformed considerably. As sportsbook operators have established their presence in legalized markets and geographic expansion has decelerated, teams face challenges filling their betting partnership inventory.
Foote characterized the current environment as a buyer’s market. Teams that previously commanded multiple partnerships worth millions annually now struggle to maintain even a single arrangement.
“They’re scratching and clawing to take anything they can,” he said.
Prediction market opportunities at the team level remain nascent. Currently, teams appear restricted to partnering exclusively with whichever prediction market platform their league has designated.
Foote anticipates this limitation will change shortly. Once leagues complete their own arrangements, teams will gain flexibility to pursue independent prediction market partnerships.
Ultimately, these relationships are driven by economics. While Foote acknowledged that leagues genuinely care about integrity when structuring prediction market agreements, financial considerations remain paramount.
“Let’s be honest, it’s ‘what’s the size of the check?’ and these are meaningful deals,” Foote said.
Sportsbooks seeking to prevent prediction markets from entering their category must make substantial financial commitments. Several teams are maintaining loyalty to established sports betting partners by allowing category expansions in return for increased payments.
Foote noted that teams are generally content with these arrangements provided they receive additional revenue for the category. As of this week, the NFL’s open betting category has yet to find a new partner.
