If you’re fuboTV CEO David Gandler, you might feel pretty good about crossing the 1 million subscriber milestone. But that mood might shift when you look over to see YouTube TV and Hulu Live TV in the 4 million ballpark. All have similar price points and similar channel packages with a few exceptions. What’s left for customers to decide is which features are most compelling. Do you prefer YouTube TV’s unlimited DVR? Or Hulu’s great on demand movies and shows, now automatically bundled with Disney+ and ESPN+? Or do you prefer fuboTV’s included 4K offerings and branding?
The differences are small, so every factor matters. And in the case of fuboTV, future differentiation relies heavily on sports betting. Why is that a problem? According to Gandler, sports betting is “100% saturated, there is no loyalty.”
Gandler shared his state of the streamer in an interview at the 24th Annual Needham Virtual Growth Conference.
Right now, the Fubo Sportsbook is only up and running in Iowa and Arizona. Gandler says 30% of his subscribers in those states have both a fuboTV account and a Fubo Sportsbook account - those are called “crossover customers.” That number is 50% better than originally anticipated. Gandler says The average sportsbook-only customer has placed about 9.5 bets in the first two months. Among crossover customers, it’s just over 8 bets. Still, those numbers need to be considered in context. We’re talking about 30% of subscribers in two states - surely a small fraction of fuboTV’s 1.1 million total subscribers.
As far as the connected real-time sports betting features promised by fuboTV and its connected sportsbook app, Gandler says he expects the product to be live in November or December. Without that functionality, there’s little difference between the Fubo Sportsbook app and something like DraftKings or FanDuel. That’s where the lack of loyalty becomes a problem.
FuboTV also offers some free-to-play games, but Gandler suggested the future may include a “play-to-earn” function, where viewers could earn in-app credits. “These people will be able to convert these credits into actual cash to place bets,” Gandler explained.
The CEO also believes fuboTV is at an advantage with shorter durations of carriage rights deals. He expects the service will get more favorable terms as the subscriber count grows. “Having shorter term deals allows us to renegotiate our rates or even packaging flexibility,” Gandler said.
Notably, fuboTV is lacking Turner networks like TBS and TNT, which harms its sports-first branding as fans are losing out on MLB and NBA coverage on those stations. “When we dropped Turner, many pundits said we were dead,” Gandler said. “Nobody drops a major media partner, especially one with all the sports content, and is able to continue to grow. We’ve defied gravity.”
Despite Gandler’s optimism, fuboTV’s stock has fallen from a high of $57.47 in February 2021 to just $13.85 today.
“What’s Wall Street missing about fubo?” the interviewer asked.
Gandler took a beat.
“Well, you know, in my opinion, probably everything.”