International Game Technology (IGT) has announced it will wrap up its electronic table games (ETG) division by 2027. The move comes as IGT narrows its focus on “core business priorities and long-term growth objectives.” This marks yet another instance of a major player scaling back as the industry trend favoring consolidation over diversification. IGT’s decision follows the spin-off of its lottery division and its acquisition by Apollo Global Management in a $6.3 billion deal last year.
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Refocusing on Core Competencies
IGT isn’t alone in its strategic pivot. One of its biggest competitors, Light & Wonder (formerly Scientific Games), undertook a similar transformation. The company divested its lottery and sports betting divisions in 2021, refocusing on its primary games and systems business. Since then, its shares have climbed 30% over five years. CEO Matt Wilson emphasized that the “streamlined organization” is now wholly centered on developing high-quality, cross-platform games. This trimming of the fat is a theme resonating across the gambling sector. As operators and suppliers recalibrate, many are finding that less can indeed be more.
Operators Scale Back on Digital Ventures
Casino operators are also participating in this recalibration, particularly with their online offerings. The past few years saw a mad dash toward “omnichannel” approaches following the 2018 PASPA decision. However, some big names have curtailed their digital ambitions. And wynn Resorts, for instance, shut down its WynnBet online brand in 2023, opting to focus on land-based opportunities such as its UAE resort. Las Vegas Sands also retreated from digital exploration. CEO Patrick Dumont stated that pursuing digital ventures no longer aligned with the company’s long-term goals. Still, similarly, Penn Entertainment has minimized its online activities after costly endeavors with ESPN and Barstool Sports didn’t pan out as planned. These moves show a shift back to core offerings — a trend that’s leaving its mark on the industry.
Potential Ownership Changes for Leading Operators
Two major operators — MGM and Caesars — might see new ownership by the year’s end. Caesars was recently acquired by Tilman Fertitta in a $17.6 billion deal, while MGM is weighing an $18 billion proposal from Barry Diller. Caesars has been rumored to be considering spinning off its digital arm, but no official word on that front has emerged yet. MGM, heavily invested in digital via BetMGM, might not find its online assets aligning with Diller’s interests. Diller has publicly expressed that it’s MGM’s physical assets that draw his attention, not the digital ventures. “We began investing in MGM nearly six years ago because it represented a rare kind of business,” Diller said, emphasizing the value of real-world assets over digital growth.
Sports Betting Companies Expand Despite Risks
While many operators consolidate, online sports betting (OSB) companies are expanding into new territories, prediction markets. This diversification can be risky and costly. Brands like DraftKings and FanDuel are leading the charge, delving into prediction products, which are treated differently than traditional gambling products due to distinct regulatory landscapes. DraftKings and FanDuel have been proactive, with DraftKings buying Railbird exchange and launching its DKeX platform. FanDuel, collaborating with CME Group, has launched FanDuel Predicts. However, this expansion isn’t without challenges. And states with strong online gambling presences are suing these prediction operators, potentially pushing the issue to the Supreme Court. Investment costs are soaring, with DraftKings projecting up to $300 million in prediction-related expenses this year. FanDuel is also expecting high costs. The firms’ shares have plummeted, with FanDuel and DraftKings witnessing declines of 51% and 31%, respectively.
Next Steps Amid Industry Change
What’s next? As businesses streamline operations, the market continues to shift. MGM and Caesars’ potential ownership changes could reshape their strategies dramatically. Meanwhile, the future of prediction markets hangs in the balance, pending possible court rulings. The industry isn’t standing still — expect more reshuffling as companies navigate this evolving environment. The MGM board’s decision on Diller’s proposal should be one to watch as the year progresses.
Garry Sputnim is a seasoned journalist and storyteller with over a decade of experience in the trenches of global news. With a keen eye for uncovering stories that resonate, Alex has reported from over 30 countries, bringing light to untold narratives and the human faces behind the headlines. Specializing in investigative journalism, Garry has a knack for technology and social justice issues, weaving compelling narratives that bridge tech and humanity. Outside the newsroom, Garry is an avid rock climber and podcast host, exploring stories of resilience and innovation.
