Published on: March 5, 2026, 11:35 AM.
Updated on: March 5, 2026, 11:35 AM.
- In states where online sports betting (OSB) is permitted, bettors show a clear preference for this wagering method over prediction markets.
- Flutter CEO Peter Jackson cites Missouri’s launch as a crucial example of this trend.
- He expresses “strong confidence” that the company is not facing any cannibalization issues.
When given a choice between traditional online sports betting (OSB) and prediction markets, bettors evidently favor the former.
During the Morgan Stanley Technology, Media & Telecom Conference, Flutter Entertainment (NYSE: FLUT) CEO Peter Jackson discussed how data provides “real confidence” that there is no cannibalization impact in states where regulated OSB exists. He pointed to Missouri’s recent sports betting launch as a case illustrating the competitive landscape between sports betting and prediction markets, leaning favorably toward the former.
“A prime example of this is Missouri’s recent launch, where we witnessed 1 in 20 residents immediately sign up for FanDuel within the first month of going live in the state,” Jackson noted. “This serves as a strong indication that consumers prefer regulated OSB over prediction markets.”
Jackson’s assertions align with industry research. For instance, ARK Investment Management has observed that in states where DraftKings (NASDAQ: DKNG)—Flutter’s main competitor in the U.S.—operates OSB, deposits into prediction market leader Kalshi remain minimal.
Why Bettors Favor OSB Over Prediction Markets
According to Jackson, there are two key reasons bettors opt for OSB over prediction markets. One significant factor is that OSB providers can offer more attractive bonuses and promotions compared to their prediction market counterparts.
In other words, entities like FanDuel can invest significantly to attract and retain customers, whereas platforms like FanDuel Predicts face constraints on promotional expenditures.
Additionally, the variety of products available is a major factor. While prediction markets are diversifying their sports-related offerings, including options like parlays and player props, the sports betting sector still provides a broader range of choices for bettors.
On a related note, Jackson announced that FanDuel will introduce a loyalty program in the second quarter.
Flutter’s Approach to Prediction Markets
With the debut of FanDuel Predicts last December, Flutter has entered the U.S. prediction market space, benefiting from prior experience gained with Betfair in Europe. The firm plans to invest up to $300 million this year to bolster its prediction market initiatives in the U.S.
However, caution is necessary in states where sports betting remains illegal. In these areas, prediction market operators are offering sports-related derivatives, which has drawn criticism from state lawmakers and regulators. For example, Utah, which is known for its anti-gaming stance, is already engaged in a legal dispute with Kalshi. Jackson admits that Utah will likely never authorize OSB but appears hopeful that states lacking regulated OSB will eventually reconsider their positions.
“We need to consider the prospects in Utah with this context,” he mentioned during the conference. “In California, we also anticipate that eventually, we may witness some regulated OSB coming to fruition. This perspective influences our ability to attract customers and improve cross-selling opportunities in the future.”