Sports Betting Industry Has Long Way to Go in Attracting Casual Fans, Super Bowl Research Shows Adults in non-legalized betting states are just as likely to bet on Super Bowl LV as. Sporttrade is a Philadelphia company poised to disrupt the sports betting industry with the first legal sports betting exchange in United States history. NEW YORK (AP) — Investors and sports betting companies are running up the score when it comes to sports betting, predicting the fast-growing industry will be a $7 billion to $8 billion business in.
Two years after a landmark decision by the United States Supreme Court, the growth of the new legal sports betting market has exceeded many stakeholders' expectations and dramatically altered the relationship between sports leagues and the gambling industry.
More than $20 billion has been bet with U.S. sportsbooks since the Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992 on May 14, 2018. The federal statute, commonly referred to as PASPA, had restricted regulated sports betting to primarily Nevada for 26 years, before being ruled unconstitutional.
Eighteen states -- representing just over 30% of the U.S. population -- now have regulated sports betting markets, with several more on deck. The District of Columbia, North Carolina, Tennessee, Washington and Virginia have passed legislation, and 16 additional states have active sports betting bills, according to the American Gaming Association. In the coming years, industry authorities expect more than half the states in the U.S. to offer legal sports betting.
Twelve states have approved full-scale online sports betting, including in Tennessee and Virginia, which will offer online wagering only. Of the $4.6 billion bet with New Jersey sportsbooks in 2019, approximately 84% of it was placed online.
Jeremy Kudon, a prominent lobbyist who includes professional sports leagues and gaming operators among his clients, said the speed and growth of the betting market -- especially online -- has been 'extraordinary.'
'I would have lost a lot of money, if I was given a chance to wager on whether non-gaming states, like Tennessee, Virginia and New Hampshire would legalize mobile sports betting in these first two years,' Kudon, a partner at the firm Orrick, Herrington & Sutcliffe, told ESPN.
The major players in the U.S. gambling industry are changing, too. FanDuel and DraftKings, two companies who made their mark in daily fantasy sports, are now full-fledged bookmakers and online casino operators, who have earned giant shares of the New Jersey market, well ahead of more traditional gambling companies like MGM Resorts and Caesars Entertainment.
As the market grows, however, problem gambling experts are concerned that states are not considering the potential harm caused by addiction. An analysis by the National Council on Problem Gambling (NCPG) showed nine states that recently authorized sports betting did not dedicate any new funding to problem gambling services.
'Research indicates that anytime we introduce a new form of gambling we will simultaneously bring additional problems and concerns, thus requiring additional dollars,' Brianne Doura, legislative director for the NCPG, told ESPN. 'It is our stance that all stakeholders bear the responsibility to contribute to the research, prevention, treatment, and recovery of gambling addiction. If you profit from legalized gambling, you share the responsibility to pay for the negative consequences that can come from it.'
As new stakeholders in the gambling industry, the NFL, Major League Baseball and the PGA Tour are members of the NCPG, as well as the NBA's Portland Trail Blazers. The leagues have quickly pivoted from their long-held objection to sports betting and are now actively participating in the industry, with sponsorship and marketing partnerships with gambling operators. The cooperation is likely to increase.
'I don't know if this is a specific trigger, but I would say that trajectory, even pre-COVID, had shown a level of willingness [from the sports leagues] to engage and at least understand what the industry is all about,' Matt Primeaux, president of sportsbook operator FOX Bet, said. 'I would expect that to continue.'
Fox, Barstool Sports and the Score are among the media companies that have or will soon launch branded sportsbooks. ESPN has a sports betting-focused partnership with Caesars Entertainment, and CBS Sports has partnered with sportsbook operator William Hill U.S.
All stakeholders will be playing close attention to state legislatures that may accelerate sports betting initiatives to generate new revenue to help mitigate losses caused by the pandemic. On Wednesday, the New Jersey Division of Gaming Enforcement reported $2.6 million in sports betting revenue in April, an 87.6% decrease from April 2019.
'When legislatures return in earnest, we firmly believe the number of states ready to consider accelerating mobile sports betting and online gaming legislation to drive tax revenue will expand substantially,' Matt King, CEO of FanDuel, told ESPN. 'And we also see the industry recognizing this is a unique moment in time, and working more collaboratively to set aside minor differences and get bills across the finish line. Across the board, it's a time for pragmatism, and we see that producing a real opportunity for significantly expanding the map.'
2020 has been a remarkable year, to say the least. COVID-19 will be The Story that characterizes the 365 days. But legal sports betting in the US took on a life of its own in 2020 and set the table for an industry that essentially proved virus and recession-proof. It figures to be one of the few 'feel-good stories' of the year.
Looking back, there were a few major headlines that characterized the record-year for the US legal sports betting industry. How it navigated the COVID shutdown of retail betting locations and sports itself, the number of states that joined the legal sports betting family, and the emergence of internet-based betting were just a few. Let's take a closer look.
'I would have lost a lot of money, if I was given a chance to wager on whether non-gaming states, like Tennessee, Virginia and New Hampshire would legalize mobile sports betting in these first two years,' Kudon, a partner at the firm Orrick, Herrington & Sutcliffe, told ESPN.
The major players in the U.S. gambling industry are changing, too. FanDuel and DraftKings, two companies who made their mark in daily fantasy sports, are now full-fledged bookmakers and online casino operators, who have earned giant shares of the New Jersey market, well ahead of more traditional gambling companies like MGM Resorts and Caesars Entertainment.
As the market grows, however, problem gambling experts are concerned that states are not considering the potential harm caused by addiction. An analysis by the National Council on Problem Gambling (NCPG) showed nine states that recently authorized sports betting did not dedicate any new funding to problem gambling services.
'Research indicates that anytime we introduce a new form of gambling we will simultaneously bring additional problems and concerns, thus requiring additional dollars,' Brianne Doura, legislative director for the NCPG, told ESPN. 'It is our stance that all stakeholders bear the responsibility to contribute to the research, prevention, treatment, and recovery of gambling addiction. If you profit from legalized gambling, you share the responsibility to pay for the negative consequences that can come from it.'
As new stakeholders in the gambling industry, the NFL, Major League Baseball and the PGA Tour are members of the NCPG, as well as the NBA's Portland Trail Blazers. The leagues have quickly pivoted from their long-held objection to sports betting and are now actively participating in the industry, with sponsorship and marketing partnerships with gambling operators. The cooperation is likely to increase.
'I don't know if this is a specific trigger, but I would say that trajectory, even pre-COVID, had shown a level of willingness [from the sports leagues] to engage and at least understand what the industry is all about,' Matt Primeaux, president of sportsbook operator FOX Bet, said. 'I would expect that to continue.'
Fox, Barstool Sports and the Score are among the media companies that have or will soon launch branded sportsbooks. ESPN has a sports betting-focused partnership with Caesars Entertainment, and CBS Sports has partnered with sportsbook operator William Hill U.S.
All stakeholders will be playing close attention to state legislatures that may accelerate sports betting initiatives to generate new revenue to help mitigate losses caused by the pandemic. On Wednesday, the New Jersey Division of Gaming Enforcement reported $2.6 million in sports betting revenue in April, an 87.6% decrease from April 2019.
'When legislatures return in earnest, we firmly believe the number of states ready to consider accelerating mobile sports betting and online gaming legislation to drive tax revenue will expand substantially,' Matt King, CEO of FanDuel, told ESPN. 'And we also see the industry recognizing this is a unique moment in time, and working more collaboratively to set aside minor differences and get bills across the finish line. Across the board, it's a time for pragmatism, and we see that producing a real opportunity for significantly expanding the map.'
2020 has been a remarkable year, to say the least. COVID-19 will be The Story that characterizes the 365 days. But legal sports betting in the US took on a life of its own in 2020 and set the table for an industry that essentially proved virus and recession-proof. It figures to be one of the few 'feel-good stories' of the year.
Looking back, there were a few major headlines that characterized the record-year for the US legal sports betting industry. How it navigated the COVID shutdown of retail betting locations and sports itself, the number of states that joined the legal sports betting family, and the emergence of internet-based betting were just a few. Let's take a closer look.
Sports in the Time of COVID
The sports world endured an unprecedented pause in the action in 2020 thanks to COVID-19. 'The Bubble' became the way that paused leagues such as the NBA and NHL were able to carry on with their season in March. Fast thinking saved those leagues.
It all started in March with Rudy Gobert's positive COVID-19 test and the shutting down of the NBA season, a shutdown that lasted 141 days and caused leagues around the world including the NHL and European Football Leagues to follow suit. Casinos in participating states also shuttered during that time.
The cancellation of March Madness, which annually contributes $1 billion to the sports betting industry was the first real sign that the gambling industry was in trouble. MLB's delayed and shortened 60-game season also put COVID on sports' front burner.
For months, the sports betting world had to rely on table tennis, sumo wrestling, and Belarussian professional soccer. But then, once North American sports ramped up, bettors enjoyed an unprecedented period in which the NBA, NFL, MLB, and NHL were all playing meaningful games simultaneously, forcing sportsbooks to scramble just to keep up.
Half of US States Poised to Have Their Own Legal Sports Betting Platform
Growth in the legal sports betting industry was remarkable in 2020 despite COVID-19. By the end of the year, 19 states and the District of Columbia had launched live, legal sports gambling. Many others actually made sports betting legal in their states during 2020 by legislation or by referendum on the November Election Ballot.
Illinois, Michigan, Colorado, Tennessee, Montana, New Hampshire, and Washington D.C. all came on board in 2020. States waiting in the wings to launch their own platform, thanks to some work done in 2020 are Maryland, Louisiana, South Dakota, Virginia, North Carolina, and Washington.
Whispers at the end of the year have the 'Big-3' states of California, Texas, and Florida at least considering ways to bring a legal platform to their states in order to capitalize on the tangible tax revenues sports betting could bring to their jurisdictions.
Mobile Betting Takes the Lead
Mobile betting sites were the biggest winner in the US legal sports betting scene in 2020, thanks in part to COVID-19. We had record mobile hauls being smashed, new mobile betting sites emerge, Governors temporarily reversing their own in-person sign-up requirements, and even one state that launched a mobile-only platform during the year.
Mobile betting platforms in 2020 separated the 'Haves' and the 'Have-nots' in the US legal sports betting industry. States like New York that employ a retail-only model didn't even register on the 'success radar' in 2020 and Nevada, the grand-daddy of all betting states, fell behind because of an antiquated in-person sign-up requirement for mobile sites.
All-in-all, betting apps became responsible for just north of 80% of the record-setting National sports betting handles of 2020. In New Jersey alone, $872 million of the insane $931,620,415 November handle, or 93.6% came from internet betting. Nevada, by contrast, saw $344 million come in from mobile apps in November, or just 56.43% of its total.
Barstool Sports, perhaps one of the most anticipated mobile app launches ever came to fruition in 2020. Tennessee, the nation's first mobile-only platform exceeded expectations during their first full month of operation in November. Illinois' Governor J.B. Pritzker saw the writing on the COVID wall, and he has temporarily lifted that state's in-person only sign-up procedure.
Casino Industry
It was quite a year for mobile betting in the US. Momentum was definitely created and is expected to continue into 2021 and beyond.
In The End…
Sports Betting Market Share
2020 was somehow a record-setting year for the US sports betting industry despite the impacts of COVID-19. The 365 days identified just what is important for bettors, and separated the contenders from the pretenders in the race to be America's most bet-friendly state.
Sports Betting Industry Trends
The arrow keeps pointing way up on the US legal sports betting industry as we head into this new year. The October National handle reached $3.25 billion, November should approach $3.5 billion. December, with the return of Basketball, could even eclipse that record-number.
In the end, there wasn't a whole lot of good that came from the year 2020, but the exponential growth and the overall acceptance of the legal sports betting industry in the US was certainly one.
