UP506 Chat_UP: LiveScore, Grok and how AI will disrupt sports betting

21:16Sam Sadi:some of them do actually you know they some of them publish their numbers on on some platforms or at least self-state their numbers. I think it's around 50-50. I would say potentially around 60-70 billion each, the regulated and unregulated. And again, even those definitions are quite vague. Now there's a new term called pre-regulated, as if any country that doesn't have regulation is a pre-regulated market as opposed to what we used to call them offshore black markets. I mean, what would you call stake.com? I mean, they operate in all gray and unregulated markets. They take business from regulated markets in illegal ways.

22:06Sam Sadi:But, you know, they're quite public, very high profile, you know, huge sponsorships everywhere.

22:12Unofficial Partner Podcast Host:Well, they're on Everton's shirt still, aren't they?

22:14Sam Sadi:Yeah, yeah, exactly. I mean, it used to be that, you know, you used to need to have a UK license, UKGC license to be on Premier League shirts. But now they've actually looked into the exact regulation and it just says you just cannot take customers from the UK. And these operators don't take customers in the UK unless UK customers use a VPN, which then they wouldn't know that they're coming from the UK. right so yeah it's it's a little bit of a so that's there's a game being played there and

22:49Unofficial Partner Podcast Host:it's essentially again it's a it's a customer acquisition game being played here isn't it it's a marketing game or what you know one of the questions about efficiencies in the market you know in a in any market is how it then leads to brand and you know where the advantages are if everyone is doing a sort of you know you're early to this obviously when every or if everyone can do this type of relationship and as you say the sort of industrialized sentiment marketplace which is controlled by a few of the big major platforms this is one way in which they're sort of using that influence from your point of view where the differentiation points are I think is an interesting question because obviously you mentioned stake and they've got a you know the premier league shirt is a just a an iteration or an execution of that question what do you see that how do you see that this is a broader one than live score but it's about the market and how what options are available to you yeah it's it's a user acquisition and also a

23:53Sam Sadi:retention engagement play so we can obviously try to be on x you know as visible as possible to try to get customers, get those followers of tipsters or be integrated into the content, but also use the content that is generated on X to supply our existing customers with more content

24:19Unofficial Partner Podcast Host:and more betting opportunities,

24:21Sam Sadi:more reasons to stay on our platform by making available these types of features. And to my earlier point, And I don't think a company like X can forge a partnership like this with an offshore operator. So these are the types of strategic advantages that a regulated operator needs to surface. And, you know, as far as I know, we're the first company both on sports media and betting to do a deal like this. And we have a first mover advantage. I don't know if X will do more of these deals. I would hope not. And I would expect not, at least for a while. So you have an exclusivity relationship with them at the moment?

25:02Sam Sadi:No, no. We just have a first mover advantage.

25:05Unofficial Partner Podcast Host:Right. OK. So how much of it is real? There's a bot question here, obviously. And one of the questions everyone's got about X or all the, you know, all of the platforms is the sort of dead Internet question. Well, you know, if there are bots on either side in whatever marketplace it is, but this feels like it could be a significant factor. And again, I have no idea about a number in terms of what the proportion of it is. But one of the concerns we all have is that as sport, and this is broader than betting, but as sport, then, you know, this arms race of engagement metrics, they'll be serviced by just bots.

25:45Unofficial Partner Podcast Host:And what's your sort of look on that? Do you, how do you keep them honest from that perspective?

25:53Sam Sadi:Well, I mean, I would challenge that whether we need to keep them honest. So let's take a typical tipster, influencer, content creator in the betting space. If we rewind 10 years, this person hopefully would do some research, would look at past form, look at injuries, and then we'll come out and say, OK, here's my pick for the weekend. Here are my picks for the weekend. Now, the advanced version of that with today's tools is using AIs and algorithms, mostly algorithms in the past but now just directly using ai to do that research and create you know the pics to post so is that is that a bot now because ultimately he can automate that the whole process yeah and even the posting and then just keep his account that has thousands of followers but a bot is doing all the work for that tipster.

26:54Sam Sadi:I'm not sure there is anything wrong with that. It's not too dissimilar to a hedge fund owner or a stock analyst posting all their research, but it's not done by humans now. It's all done by AI. So the actual human element in this space is not that relevant, right? Like the authenticity of the real person. It's actually the content, which is not human, that is driving the engagement. So a lot of these content creators, you know, don't even have their own picture on XO. It's just a logo or some random picture because there's no human element. You know, there's no association to the authenticity of being a human.

27:46Sam Sadi:And it's a bit different in other industries where you're looking for that human brand, even though like some, you know, AI influencers on Instagram are challenging that now.

27:57Unofficial Partner Podcast Host:So it's a sort of commodity. It's easier to commodify in that way in this. Absolutely. Because it's all about just slight advantages, which are very short term, aren't they? So there's a speed and a reaction.

28:09Sam Sadi:Yeah, it's how good is your content? How good are your predictions? And, you know, how can you consistently provide value to your followers? So it's less about brand, it's less about influence, it's actually, you know, the quality of the content. And if a bot is producing something much better, there's no allegiance to the authentic human that used to be producing it.

28:35Unofficial Partner Podcast Host:So it's a product over brand, actually, isn't it? in this space yes yeah yeah yeah and the regulators response to this trend what can we anticipate because it you know they will look at this and say personalization ai and betting that's a cocktail that they'll want to don't know what they normally want to stop it so what what do you think and that will be a territory by territory thing presumably but that just what's what's your anticipated sort of view of that question i have to react to this because i

29:12Sam Sadi:haven't really thought about it but most of the time it's making punters a lot smarter they're giving them the same let's say level of technology that's you know sportsbooks have to price you know events and propositions. So it's a bit of a, you know, leveler in terms of the playing field. So I can't, I'm not sure delivering more personalized, you know, products to the users while the users are able to access, you know, technology that makes them smarter in terms of their betting choices is actually a bad thing. Don't forget, like, as gambling companies, and sports books, we'd rather have long-term customers that lose very little at a time and just continue their enjoyment of the experience for an extended period of time.

30:13Sam Sadi:We'd rather not have someone who has maybe 100 pounds of disposable income to spend on betting to lose it in one bet. We'd rather have 50p of that at every bet for 200 bets or have them win for a while. And it is an entertainment product after all. And to make it sustainable, if we have smarter hunters, that is not really a concern. We do have a built-in edge that comes into play. And if that is being challenged by this kind of support technologically, it's not a concern on our end.

30:57Unofficial Partner Podcast Host:how do you feel about the there's an Elon Musk factor there's an obvious question about how that played into your initial decision making process he's obviously a polarising figure and he is representative of the brand and that will always be the case as long as he's involved so how did you sort of look at that question was that a consideration or was it just too good a thing to pass up

31:25Sam Sadi:the canned response to that is we're doing a deal with one of the largest companies in the world and not with an individual and as much as the individual is tied to the to the brand of the company again this is a very large and potentially transformative deal for us with a i don't know they're worth more than i think they're worth a few trillion so one of the largest you know companies in the world so sure it has been raised like should we be concerned should his political ideologies come into play but then you know that's a that's a pandora's box that's you know you'd have to consider at every major partnership i mean do you do a deal with news corp and and you know do you do a deal with you know any may you know are you against bill

32:19Unofficial Partner Podcast Host:gates so should we stop using teams yeah yeah yeah if we depersonalize it from musk and go to grok there are two questions one is the picking a platform you had you know that we have a had a conversation with about microsoft and the premier league you know big leagues and big you know entities who want to take advantage of ai you are then presented with that a range of a small number of options, presumably, in terms of which one to go to. Take me through that. And how do you see, I'm not qualified enough by some margin to say, which is the best AI? I'm constantly battered by all these people saying, you know, Grok has just won this test.

33:04Unofficial Partner Podcast Host:OpenAI has done this. There's a new product coming out. Everyone's talking about a bubble in AI, all of those questions. But just when you were thinking about this, and it's one of those where you're fascinated by the differences between them, and do they actually matter very much? But give me a sense of the difference between them.

33:23Sam Sadi:For this conversation, there's only one distinction, one differentiation that matters. Grok has access to real-time X data. And in terms of all the other metrics, it's a race between OpenAI, Grok, Antropic, very comparable. One release gets them ahead, another release catches up. But there is no AI model right now that can access real-time information. And sports and news remains very much a real-time topic. So you can go to Grok one minute after the end of a Premier League game and ask, how was this game? Who was the best player? What happened? Can you analyze what happened in the Premier League today at 5 p.m.

34:23Sam Sadi:with all the 3 p.m.s finished? and it's incredible the depth of information and analysis that Grok can provide and you can do that also with news like I used it right after like the Zelensky Trump you know you could call fiasco and and you know I was asking it to calculate probabilities of the war ending and Ukraine winning and it would go so much into depth about what just happened and all the content that is being generated on x and if if you're operating in in our space you need to have that kind of real-time information to surface you know relevant outputs and that's the big differentiator for us

35:04Unofficial Partner Podcast Host:and the the prediction markets again it's a sort of interesting area which is feels like it's part of the thing but is an offshoot of it what is there how do you view that that area

35:20Sam Sadi:I mean it's hit the industry like an asteroid and by the way X has a very similar deal with poly markets so yeah I mean there's a lot of similarities again you know those markets those products rely on real time sentiment and on the regulatory side, they've just opened sports betting to the entire United States. So there's a lot of conversation going on around what the future of that is. For our British audience, prediction markets are nothing different than what Betfair has been for a while. So there's certainly an overestimation of how popular they can become if there is regular sports betting in those markets.

36:21Sam Sadi:And in terms of non-sports prediction markets, those are very small, really, to be significant. They make a lot of noise when it comes to politics and elections, and they're rather accurate, or let's say more accurate than maybe polling. But in our space, in sports betting, It's just an unexpected development that's been going on for maybe half a year to a year. And it's probably going to push towards more regulation because currently it's completely unregulated and available in states that's explicitly banned sports betting.

36:59Unofficial Partner Podcast Host:Is there a skew of sports by sport on Grok? what is it that it's showing up because football here is dominant and is it a global deal you've got so you've got the heart is it it's not categorized by a territory is it it is on sports

37:20Sam Sadi:media it's global um and on sports betting it's limited to uk ireland and nigeria right okay so

37:30Unofficial Partner Podcast Host:football is presumably is dominant in those those market but i'm soccer i'm talking about so how does that what what else is in there because i'm my head always is going goes to soccer but where are the i had a the reason i'm interested in this is that we had a conversation with peter hartman about cricket in america and cricket and peter obviously was at meta for a period of time And he'd seen that cricket in America is oddly popular. And it's, well, I say oddly popular, but it's a huge Indian diaspora and therefore skews the data to a degree that actually was quite interesting for them. And I'm wondering what else lurks around.

38:13Unofficial Partner Podcast Host:Soccer is dominant culturally and I'm assuming within the betting marketplace. I'm wondering what else there is. And the other, there's a sort of follow on question about if you were the CEO of a sports governing body or a league or what you would do with this information.

38:35Sam Sadi:Those are tough questions for our business. Football, soccer is everything. So our entire focus is on that. when we're talking about AI, I think our relationship with XAI is a technology relationship. It's not directly linked to sports or sports betting. It's really what we make of it. The baseline could be that we just have access to XAI tokens. So that's just usage. And we use it for everything that we're doing in the business. It could be accelerating workflows in the legal team to review contracts. Today, we use Gemini and Google. So it could be that we move our work to their platform because we have a better deal.

39:30Sam Sadi:Or it could be creating a Grok-led predictor, advisor, analyst on our products that advises you on what the outcome of the event is going to be. Or it could be just content generation. We currently, at any top league match, when you go to our product, it will immediately give you an AI summary of what's been happening up until that point. So if you go a minute 27, it will give you a summary of what's happened, what's been DXG, who's got attacking momentum, what have been the big mischances. So a summary of everything that you've missed until that point at the minute that you go to our page. That's again, that's based on OpenAI ChatGPT right now.

40:22Sam Sadi:It could be that we do that with Grok. and then maybe we attempt to integrate some X content that drives that summary. So again, it's exploratory at this moment how we will use their technology.

40:38Unofficial Partner Podcast Host:And this is beyond, you know, broader than... That question about how, if you were in sports shoes, when you're... And this is broader than your deal with Grok and AI, but when you're looking at this market, Again, in my head is there is a leakage question. That's quite often comes back when, you know, the money generated by the IP. I'm using two circles because I've just come out of their summit. So their numbers are in my head, but their number was that for every dollar sports IP generates that is captured, another 95 % or 95 cents is leakage. and one question for every CEO is what's your leakage number and can you do anything about that?

41:29Unofficial Partner Podcast Host:Betting is always in the bucket of leakage unless you're the Hong Kong Jockey Club, which captures a lot of it, but not everyone's in that game. But as you can see, the big question of as the media rights market and the bundle disintegrates and the audiences are on TikTok and X, how do you monetize them? betting moves into frame in terms of what is our relationship fantasy is one iteration of that but just how did it what do you think about that i know it's a sort of broad question but just interested in your what you know that they would be interested in

42:08Sam Sadi:leakage defined by money that they're not they're not earning yeah someone like that a premier league

42:17Unofficial Partner Podcast Host:game where sky has paid you know tv rights money sponsorship all of that is captured but then there's a betting market there is a fan you know a fantasy market there is a whole piracy everything that's happening on social media as well all of that stuff that you've created you've created the fame you've done the work you've built a league that has in resonance with enormous numbers of people and yet other people are taking money from that relationship that's how leakage that's how you know that's the definition

42:54Sam Sadi:this is not going to be the answer you expect if i were

42:57Unofficial Partner Podcast Host:the owner never is sam it never is that's why i like talking to you

43:03Sam Sadi:i would want that number to be as big as possible so if i'm making one And if my IP is generating 10, that means there's tremendous engagement around my product on various different platforms. So if Premier League Fantasy today has 11 million users and in my view is not really doing a good job in delivering value to those users. It's using its brand primarily and reach. And then if I come in as LiveScore and next year launch a much better fantasy game based on the Premier League, that it has a lot more rewards, a lot more engagements, a much more advanced game. and I distribute it across the world and I get maybe 50 million users on that game.

44:13Sam Sadi:Hasn't the Premier League benefited from that? Currently, how much money does Premier League make of Francis Le Paul? Nothing, probably.

44:23Unofficial Partner Podcast Host:They may have some advertising and sponsors to it.

44:26Sam Sadi:But if LiveScore gets 50 million users playing Premier League fantasy, obviously we wouldn't be able to brand it that way, but let's say fantasy game based on Premier League. And let's say we make 50 million pounds out of that. That would go into that leakage bucket, right? but we've just created an enormous amount of engagement around the IP of Premier League. So those people are watching Premier League more. They're going to consume highlights more. They may pay for a subscription in the future. They may subscribe to Premflix. So like I said, I think... You're doing their marketing forum. I think IP owners and sports federations should try to understand what really their purpose is and what they want to be good at.

45:23Sam Sadi:They all wanted to be and still want to be media companies. In some cases, they want to be social media platforms. If they want to be sure, are they able to create the next YouTube, the next Instagram, the next live score? it's not that easy they have to like really invest and you know hire the best people and have a long-term vision and and you know have to do a much better much much better job than than we do so that's one direction they can and they can take a long-term view and american sports leagues do that much better than anyone else um or they can be hey you know we are the the sports we are the the content on the pitch and we partner with external companies who amplify so that you know our audience remains engaged and and continues to grow yeah that's a great answer it's a really interesting answer because and it's it's sort of a really good counter to

46:33Unofficial Partner Podcast Host:the very you know rights holder focused look at what sport is and what its audience is and there's always going to be a sort of that there's an official unofficial there always was wasn't there there's that you know even from the early days of websites you know people were saying well what why do i go to the official spurs website when the unofficial ones are much more interesting and they're you know there there's a wild west out there which is fun to engage with So it's a fascinating balance. Just to finish off then with a question about, yeah, the future. What does this tell us, this deal, about the relationship with AI?

47:23Unofficial Partner Podcast Host:What have you, as part of the process, you've obviously, you know, a lot of this is, and the difficulty of AI is future-proofing it or just being relevant whilst they, Silicon Valley and China, were away with new things. And trying to pick winners is one question we've talked about. But just give me a sense of where you think that's, their market's going to go. and we're yeah there's always a you're you're you're in there now with with grok and and x i'm fascinated to know how you see what the what the risk profile is maybe or sort of the opportunities are that you want to develop what's the utopian view i think i'll stick to

48:13Sam Sadi:the answer I gave you last time we discussed about this is that anybody tries to predict

48:18Unofficial Partner Podcast Host:no it's you know you're a fool

48:20Sam Sadi:if you think you can predict you know where AI is going to take the world and in particular you know any business you have to play defense at this stage so you have to increase the literacy of your company on the technology look at what it's capable of doing today and see how you can become more efficient as a business while maintaining the same business model that you have, and also how you can leverage technology to bring value to your customers. The race that everyone is talking about, that's the underlying technology. And we're not part of that race. That is about building gigawatt data centers and trying to have the best foundational models on top of which companies like ourselves will deliver products to the end user.

49:17Sam Sadi:We just need to be active in that space and try to stay relevant, try to make sure that our brand is not just a destination that is today, so the LiveScore app or the LiveScore Bet app, but it's just a brand that people trust to deliver them sports-related content. Whether that happens with a different interface in the future, I think it's going to be more and more important in terms of authenticity and reliability from whom the information is coming from rather than what platform it is coming from. For the moment, it's the same, but again, paranoia has to be in every business right now in terms of whether AI can disrupt their business or whether their rivals are going to be able to deliver better user experiences leveraging AI.

50:15Unofficial Partner Podcast Host:What does this do for the... It's a question I've probably asked you before, but as the sports relationship to the betting markets has evolved, you've got the plumbing of things like Sport Radar and Genius and these deals that were done and have been done over the last decade or so. What does AI, do you think, do to that framing of the relationship?

50:42Sam Sadi:That's a good question. Again, it has the potential to be very disruptive to their data collection, but they're very aware of that and they're investing heavily. So it could make data scouts, the people who sit at stadiums, obsolete. Maybe all the data collection gets automated. but also you know the the variety of data that is being collected will probably grow exponentially and that's going to allow companies like radars and geniuses of this world to deliver much more content to their clients and but what is it what is an official data feed at this point because if you're getting all that sentiment of grok why does someone well just give me a second because

51:29Unofficial Partner Podcast Host:I'm trying to work out what is being sold. What is happening on the pitch in real time.

51:37Sam Sadi:So a pass, a throw in, the players' movements, shots on goals, more and more in that stats being available.

51:46Unofficial Partner Podcast Host:That could become exponentially more valuable over time rather than less. Because if there's a walled garden around the match, then live better, you know, the live...

51:57Sam Sadi:a legal wall garden around it and that is quite well protected right now with the official data deals and the and these companies are investing heavily to make their product more and more valuable or at least indispensable to not just our industry but to media industry but also to broadcasters you will have seen like the advances in in broadcast technology that especially nfl and you know amazon is doing but it's not amazon is actually genius behind you know their i think it's called vision something um so they you know there could be another company that comes in and has much better technology to deliver much better value to the betting industry or the media industry or to the rights holders and in the next cycle you know of of these you know rights auctions they may come in and be able to bid a lot more because they've figured out a way to do it either much cheaper in terms of data collection and delivery or in a much richer way that we on the other side of media and betting would be willing to pay more.

53:07Sam Sadi:So it's a very fluid industry but I'd say those are quite formidable companies and they've been doing this and adapting to the changing technologies for a while so it's not an easy space for a newcomer to crack but again with ai it is possible fascinating listen we got there in the end

53:31Unofficial Partner Podcast Host:because uh you know it's always on a technology you know related podcast that the technology creates was a bit embarrassing yeah but um listen thank you as ever sam really interesting i always I always say this, but I always find it like a, um, you're, you're a interpreter for me in terms of this market and that world. So, um, thank you very much. Really enjoyed that.

53:57Sam Sadi:Glad to be useful. Thank you.

54:15Thank you.