1 Year After PASPA’s Death
The one-year anniversary of the U.S. Supreme Court striking down a federal ban on sports betting passed on May 14 and since then the nascent U.S. sports betting industry is thriving across the country.
It’s been one-year since the U.S. Supreme Court struck down the federal Professional and Amateur Sports Protection Act (PASPA), which effectively banned sports betting in all but five states.
Since then, sports betting in the U.S. has boomed with eight states now allowing sports betting and five more that have approved some sort of sports betting legislation. As many as 17 states may have legal sports betting in place by the end of 2019.
“There’s no doubt about it, sports betting legalization is the industry’s biggest victory in a generation,” said Sara Slane, senior vice president of public affairs at the American Gaming Association at the recent Southern Gaming Summit. “In the year since the federal ban on sports betting was struck down by the U.S. Supreme Court, nearly $8 billion has been legally wagered on sports. That has generated more than $55 million in state and local tax revenues … States are lining up around the country, introducing legislation to legalize sports betting.”
Slane pointed to polling by the association that found that as many as eight out of ten Americans approve of legalized sports betting.
Another poll taken by GlobalWeb Index and the Action Network, put the number at two out of three Americans supporting sports betting. That poll also found that about 68 percent of sports fans either placed a sports bet in the last year or would have had it been legal where they live.
The poll also found that 80 percent of respondents would place bets online as opposed to 50 percent who would go to a live sportsbook.
However, Slane was quick to point out that there are still areas where the newly emerging sports betting industry needs to pay attention. Other polling by the association found that only about 56 percent of Americans even know sports betting is now legal in the country.
Slane said the U.S. industry has to be responsible in its advertising and protection of problem gamblers and learn from Europe, where several countries—including Italy and the UK—are pushing for total bans on gambling advertising.
“This is an area we want to get out in front of,” she said. “We want to have some sort of self-imposed, self-regulatory body in place so that we can keep everyone in check and that we don’t want to end up in the same place that daily fantasy sports did back in 2016, when you saw that clampdown happening throughout the country, where you saw them making daily fantasy sports illegal.”
The major sports leagues have also pushed for the implementation of “integrity fees” on sports wagering, which the league’s say will be used to look for betting anomalies and keep games honest. However, no states have included the fees in their final legislation.
Instead, the leagues—particularly Major League Baseball and the National Basketball Association—are looking to gain fees through the release of their official sports data, which can be critical for in-play betting.
“MLB and NBA are still adamant in wanting to get, what they call a royalty, which everyone else knows is the integrity fee,” said Slane. “They do think that they are entitled to this because of the content that they produce. The NFL has largely stood silent; they are more focused on data. They want to see mandatory data requirements in statute that makes books have to buy their data.”
Another trend involving the leagues is their embracing of sports betting and before that daily fantasy sports after years of opposing any expansion of sports betting.
MGM Resorts International, for example, has signed marketing deals with the NBA, MLB and the National Hockey League.
Scott Butera, president of MGM Interactive gaming told the website Sports Handle that the roll out of sports betting in the U.S. is gaining momentum.
“I think the obvious thing has just been how tremendous the response has been to sports betting,” he told the website. “I think because of the state-by-state approach, the implementation is probably taking a little bit longer than everyone expected, although we’re starting to see quite a bit of momentum now. Where it has gone live and gone live with the appropriate model it has shown just how effective it can be. You look out on the landscape and you look at numbers like almost $8 billion being wagered since PASPA’s been overturned, with around $3 billion of that being from states outside Nevada it’s just an early indicator that this is going to have a powerful impact.”
Still, the anniversary leaves rooms for the question of what will happen next in the sports betting market? Jason Robbins, CEO of daily fantasy sports company DraftKings recently spoke to Sports Illustrated about expected innovation in the industry. DraftKings has launched successful live and online sportsbooks in New Jersey and Mississippi.
“The challenging aspect of that question is that this is a heavily regulated industry,” Robbins said. “A lot of the things in a typical market that might occur, they’re not possible or they’re restricted in some way by regulators. I think for that reason it makes it extra hard to kind of predict what the innovation will be. Personally, I’m not sure there won’t be another innovation before this, but I think social and peer-to-peer based betting options is going to be something that develops over time and becomes a significant chunk of the way that people are experiencing betting. I think there’s a really large audience of people that want to bet with their friends.”
Butera of MGM predicted that the industry will just get bigger.
“I think it is going to continue to grow dramatically,” he told Sports Handle. “I think over the next couple years you’ll hopefully see 20 some-odd states fully engaged in sports betting. I think the trend toward mobile is going to continue. I think you’re going to see really enhanced product with not only the number of prop bets but the entertainment associated with them whether it be with video clips, highlights, etc.
“I think you are going to see sports betting combine into one great social, entertainment type experience and that will manifest itself online and manifest itself at arenas and stadiums,” he said “It will manifest itself in sportsbooks, it will be in bars—anywhere where sports is a component of entertainment I think you’re going to see a whole wave of sports betting entertainment related content enhanced through technology. It will be pretty interesting to see where we will be one year from now.”