Podcast Summary: The Betting Platform Rivalry Looming Over the Superbowl

Podcast: WSJ Tech News Briefing
Host: Katie Dayton (The Wall Street Journal)
Date: January 27, 2026
Guests: Sam Goldfarb (WSJ Markets Reporter), Jared Diamond (WSJ Sports Reporter), Peter Ciampelli (WSJ)

Main Theme

This episode explores two timely tech topics:

1. The impact of AI on major software companies and their stocks, with insights from WSJ's Sam Goldfarb.
2. The rise and legal turf wars of prediction market platforms—like Kalshi and Polymarket—versus traditional sports betting giants amid record-breaking Super Bowl wagers, with sports reporter Jared Diamond.

AI's Impact on Software Stocks

Key Discussion Points & Insights

• Sharp Downturn in Software Sector

  • Well-known software companies (Salesforce, Adobe, ServiceNow) have each lost 30%+ in stock value since early last year, echoing a broader market trend impacting both public and private equity-backed firms.
  • "[It’s] basically all of them…from tiny companies handling billing for yoga studios to giants like Salesforce."
    — Sam Goldfarb [01:46]

• AI Automation and the Rise of “Vibe Coding”

  • Early 2025 saw a shift as AI tools made coding easier and reduced demand for traditional software development roles.
  • The launch of "Anthropic’s Claude Code" accelerated stock declines:
    "There was a lot of talk about just how easy it was to write software with these AI tools."
    — Sam Goldfarb [02:25]

• Economic Headwinds Adding Pressure

  • Rising interest rates since 2022 hit the sector even before AI-related disruptions.
  • Pandemic-led remote work initially boosted software stocks, but this momentum faded as rates and borrowing costs increased.

• Is It the End for Software?

  • Uncertainty reigns, but some analysts see opportunity for select firms to harness AI and lower costs:
    "A lot of people do think that now could be a buying opportunity because stocks have fallen so much...but it’s unclear exactly what company that is."
    — Sam Goldfarb [04:07]

Notable Quotes

• "Beginning of 2025 is actually when the term Vibe coding was invented...stocks started to gradually decline."
  — Sam Goldfarb [02:25]

• “There should be some companies that even benefit from this trend...But it’s just very unclear...which of those companies will be those successful companies."
  — Sam Goldfarb [04:07]

Rivalry: Prediction Markets vs. Traditional Sports Betting Apps

Key Discussion Points & Insights

• What Are Prediction Markets?

  • Viewed as financial products by platforms, but as betting by most consumers.
  • "Polymarket and Kalshi say this is a financial product...but to most people, [they] are the latest trend in the growing American pastime of betting."
    — Jared Diamond [06:35]

• Prediction Markets vs. Sports Betting Explained

  • In sports betting (FanDuel, DraftKings), bets are placed against “the house,” which sets odds.
  • In prediction markets, users ‘trade’ directly with each other; there is no house, and the platforms act as marketplaces (the “house” just facilitates trade).
  • "In prediction markets, there is no house...You are wagering or trading with other people."
    — Jared Diamond [07:05]

• Regulatory Gray Area and Legal Loopholes

  • Sports betting is state-regulated and legal in 30 states + DC, but banned in big markets like California and Texas.
  • Prediction markets are federally regulated as financial products by the CFTC, allowing operations in all states—sparking outrage among state regulators and betting companies.
  • “California and Texas are saying, ‘Hey, this is sports betting. We didn’t legalize this. How are you allowed to do this in our state?’”
    — Jared Diamond [08:20]
  • Several states have sued prediction market companies; a Supreme Court battle is expected.

• Cultural Impact of Sports Betting

  • Sports betting revenues hit $15 billion (2025, YTD through November), up a billion from the prior year.
  • Gambling is now widespread in U.S. culture, with stadiums featuring in-house sportsbooks and a sharp rise in addiction among young men:
    “You can’t go to a sporting event without seeing advertisements for FanDuel and DraftKings...and we know from studies that particularly men between the ages of 18 and 35 are gambling at extraordinarily high rates.”
    — Jared Diamond [10:17]

• Prediction Market Appeal

  • The ability to bet on virtually anything, from sports to political outcomes, is pulling in new users—sometimes circumventing local betting bans altogether.

Notable Quotes

• "That is essentially the difference. And it is to this point what has allowed Kalshi and Polymarket to operate as a financial product and not as a gambling product, which really is at the center of this entire discussion...that likely ends up at the Supreme Court."
  — Jared Diamond [07:05]

• "The rise of online sports betting has fundamentally changed American culture, just in profound ways. Sports gambling is everywhere."
  — Jared Diamond [10:17]

Timestamps of Important Segments

• 00:19 – 05:11: Software stocks slump & AI’s impact (guest: Sam Goldfarb)
• 05:45 – 11:03: Super Bowl betting, prediction market rise, legal and cultural implications (guests: Jared Diamond & Peter Ciampelli)

Memorable Moments

• The coining of “Vibe Coding” to summarize the transformative—and disruptive—potential of AI-driven software automation. [02:25]
• Jared Diamond’s breakdown of the regulatory fight between states, traditional betting companies, and prediction markets, which he anticipates could go to the Supreme Court. [08:20]
• The staggering figure of $1.5 billion expected to be wagered nationally on the Super Bowl—a new record. [05:45]

Episode Tone and Style

The conversation is brisk and informative, blending financial analysis with regulatory intrigue and snapshots of changing American culture. The tone is analytical but energetic, reflecting the stakes and speed of change in tech and gambling.

Quick Takeaways

• AI is causing widespread uncertainty—and opportunity—for software firms, leading to sharp stock declines.
• Prediction markets are exploiting regulatory loopholes to expand rapidly, raising legal, financial, and cultural implications.
• With sports betting already reshaping American habits, prediction markets may provoke a new wave of litigation, policymaking, and innovation in the industry.

End of Summary