Just one year after launching its German sports betting enterprise TIPP3 (Tipp3.de) European telecommunications giant Deutsche Telekom has terminated its subsidiary, following reports of significant underperformance.
In April 2015, Deutsche Telekom governance announced that it had entered the German sports betting market, acquiring a majority 64% stake in Tipp.de Sportwetten GmbH owned by Deutsche Sportwetten, who would continue to manage TIPP3 operations under a joint venture.
At the time of its acquisition, Deutsche Telekom detailed that it wanted TIPP3 to be a leading operator in the ‘soon to be regulated’ German sports betting market.
TIPP3 would receive one of the original twenty German sports betting licenses by the Hesse Ministry, whose regulatory mandate would be successfully contested by several European operators on the grounds of enforcing unfair business restrictions and creating uncompetitive market conditions.
Industry news source eGaming Review has revealed that TIPP3 faced numerous commercial challenges with an ‘outdated product’ that could not meet consumer demands or compete against rival competitor services.
A German industry insider would detail to eGaming Review that TIPP3 had become an “expensive mistake” for Deutsche Telekom.
Austrian-licensed gaming operator Österreichische Sportwetten, DT’s minority partner in the Deutsche Sportswetten JV, will continue to operate the Tipp3.at site in Austria.