Kambi and LeoVegas Extend Partnership: Implications for In-House Platform Migration
LeoVegas has decided to extend its established partnership with Kambi, ensuring that their turnkey sportsbook relationship continues until the end of 2027 as they work towards transitioning to an in-house solution.
The recent agreement, which builds on a prior extension in 2023, involves Kambi’s enhanced Odds Feed+ service, designed to extend beyond 2027. This partnership seemed likely to shift as LeoVegas had acquired Tipico’s U.S. betting platform last June, indicating a significant change on the horizon.
The timing of this announcement raises questions about the pace of LeoVegas’s in-house platform migration, initially discussed by MGM’s CEO Bill Hornbuckle earlier this year. He indicated that the rollout was expected in LeoVegas’s primary markets by mid-year. Hornbuckle also expressed ambitions for a comprehensive integration well before the first half of the year concluded.
When LeoVegas’s parent company, MGM, secured the Tipico platform, they signaled a strategic move towards a proprietary sportsbook aimed at enhancing their international market presence, excluding North America where BetMGM operates through a joint venture with Entain.
Kambi’s statement confirms that their partnership will now endure for an additional two years, during which LeoVegas is set to continue integrating its own proprietary sportsbook. A spokesperson for LeoVegas reassured that the Tipico integration remains aligned with their timeline, emphasizing that the Kambi extension is a strategic move to maintain stability as they advance their in-house product development.
Moreover, under this refreshed agreement, LeoVegas’s various brands—such as BetMGM and BetUK—will gain full access to Kambi’s array of traded odds.
Kambi’s CEO, Werner Becher, expressed enthusiasm for the partnership’s continuation, which began in 2016. He noted, “Our ability to extend this relationship and provide access to our Odds Feed+ underscores the strength of our trading capabilities and marks a new chapter in our collaboration.”
Effects of Renewal on Kambi
The extended partnership is timely for Kambi. With competitors like Penn Entertainment shifting toward proprietary platforms, Kambi has faced challenges, witnessing declines in revenue and net profit. Becher acknowledged these results were not reflective of the company’s aspirations and emphasized a strategic pivot toward diversifying offerings and client engagements.
An analyst report from ABG Sundal Collier indicated that LeoVegas likely represented around 3% of Kambi’s revenue in 2023. Despite the challenges ahead, there is potential for LeoVegas to become a more significant customer, especially as MGM explores its international growth.
Interestingly, the prospect of MGM evolving into a modular client—potentially leveraging products like BetBuilder—may allow Kambi to retain a foothold as larger operators increasingly turn to outsourcing various components of their platforms.
Evolving Supplier-Operator Dynamics
A recent discussion with Kambi’s SVP of Commercial Operations, Jamie McKittrick, highlighted the shift towards more adaptive relationships between suppliers and operators. As traditional offering structures transform, Kambi is responding by expanding its sports betting product suite to meet diverse operator needs.
“We are committed to delivering tailored solutions, ensuring we cater effectively to operators of all sizes and strategies,” McKittrick commented. “Developments like Kambi’s Odds Feed+ exemplify our dedication to providing high-quality, flexible services in an evolving market landscape.”
This renewed collaboration not only bolsters Kambi but also reflects broader trends in the sports betting industry, where adaptability and responsiveness are becoming critical for sustained success.