In light of recent groundbreaking events in New Jersey and the historic victory for supporters of sports betting legalization across USA, a few words on this “controversial” subject seems to be in order, especially since this grand finale of the fight that lasted for eight long years is also a possible prelude into a new chapter of gambling, the one that casino operators eagerly await: the entrance of sports betting in landbased and online gambling universe.
To some, the idea seems distant, or, to be more precise, too gradual, and with a noticeable lack of a proper kick that would finally set things into motion and spread sports betting across the USA. Others argue that things are practically moving warp speed, ever since last year when Connecticut, Mississippi, Pennsylvania and West Virginia passed the sports gambling legislation, putting at ease the minds of those who have the most to gain by the legalization of sports betting. If you are still not sure how to feel about it, just ask yourself one simple question: how exactly will sports betting change the face of casino gambling and contribute to the revenue harvested from landbased and online gambling services?
Implications of introducing sports betting in brick and mortar casinos across the USA
To even begin dabbling with a massive and complex issue of sports betting and all its pros and cons, we must first try and understand what made it so undesirable inside the landbased gambling venues so far. The answer is of course money, regardless of the ethical reasoning provided as the official explanation for any forbidden or restricted action. In other words, the main reason sports betting was banished from the legal sphere in the majority of states is the inability of relevant government channels to meet or apply the necessary guidelines which would allow them to collect taxes.
The financial potential that casino operates detected was, naturally, too tempting to be shoved under a rug and disregarded for long. As an industry, gambling offers a massive potential which seems like a bottomless pit governed by three things – offer, demand, and law. While the first notion is closely linked to the creativity of the provider, it still has to abide by the almighty Law, which has the tendency to mutate and shift its form so that it could serve a country’s economic principles. Putting it more plainly – if there is a legal obstruction preventing the state from collecting the tax, it will be much more difficult to legalize the offer. And, since the casino operates will turn to overseas companies to obtain and set up the required software which will enable the proprietors to facilitate sports betting in their premises, the taxation procedure will become a lot more complicated than with domestic businesses and white label providers.
Conflict of interest and illegal activities – the rationalization of prohibiting sports betting or a justified fear?
One of the main arguments that support the anti-sports betting advocates is the possibility of sharp practices or even flat-out frauds which can very well be the side effect of making sports betting a part of the casino scene. Even if this is only a fabricated excuse, as some will have you believe, the possibility of the conflict of interest is not at all abstract. As a consequence, the legal permit that would grant casino the right to offer sports betting services would have to be issued selectively and not all casinos would be able to qualify. Reason? Some casino owners are also owners of certain sports teams and you can imagine the level of suspicion and controversy this could potentially rise.
On the other hand, those who are not opposed to sports betting in land-based casinos claim otherwise, arguing that, if anything, opening the casino doors to sports betting will make every element of the betting procedure much more transparent, nipping in the bud any attempt to fix the match.
Are there actually any grounds for these types of doubts? Of course, but there are those who support the theory that the legal sports betting platform inside a casino which already acquired a license for providing gambling service will be under additional scrutiny since every aspect of the betting protocol must be clearly presented to the players, especially if they have any types of complaints. At the moment, with the casinos still waiting on the green light to announce the sports betting and while the illegal markets are virtually flourishing, the players do not have the proper channels to turn to in case of any irregularities, leaving plenty of open space for all kinds of undesired activities.
If, however, the service is available on a legally regulated platform, every report will be taken seriously and there will be no room for misinterpretation – each step will be clearly laid out, with severe legal consequences for any deliberate or negligent breach of trust and law. Those who are fearful that the fairness of the games might be corrupted, should consider the fact that not welcoming sports betting in the US casinos will only boost the illegal markets and still leave room for just the kind of unethical activities we are looking to avoid; legalization would at least put the dishonourable behaviour under a spotlight and discourage it, if you feel that the complete elimination sounds too idealistic.
Sports betting revenue compared to the one generated by the traditional casino offer and the competitive edge
With this said, we are coming back to the starting point – money. Even if your dog is not in the race, the question of sports betting, its legal nature and its availability across the USA is something that concerns every citizen, regardless of their direct involvement or awareness.
You don’t have to be an expert to figure out that the revenue coming from the sports betting is massive. From that perspective, every day that goes by with this part of the gambling industry on the other side of the law is a huge amount of money lost, and we are not only talking about the tax money. We are also talking about approximately 150,000 job posts that the introduction of sports betting in brick and mortar casinos would generate. Unbelievable, right? And this is just the beginning – casinos are only the first step and, looking at the estimate of 6 billion dollars increase of the states’ annual revenue, it is pretty safe to assume that setting up specialized venues focused or limited to only sports wagering is only a matter of time.
At the moment, US sports fans are forced to seek alternative solutions to quench their thirst for sports-related gambling, especially with WC or other major sports events ahead. With that in mind, the peril of consciously commercializing sports seems like a small price to pay; besides it would only mean putting a stamp of approval to the actions that are already put into practice. Sports betting already exists, whether we like it or not, legalizing it would simply place it in the controlled environment.
Currently, it is up to the individual government of each state to decide if the illegal practice of sports betting will be taken out of the dark and become available in landbased casinos – the online venues are of course an entirely matter altogether, since even the states where sports wagering is legally approved require your physical presence. With New Jersey taking the lead, it is unlikely that the rest of the states will pass on the opportunity to improve their economy and leave the neighboring states to dominate the gambling market. Assuming that more conservative governments decide to preserve the sanctity of sports and deprive the casino operators of the right to compete with out-of-state casinos who legalized this type of betting, the impact that this would have on the relevant state’s economy would not be negligible.
If this seems over the top, it’s enough to just look at Nevada – only last year, the state has set the record in their state revenue, generating almost a quarter of a billion – $248.8 million, to be more precise. The number is referring to just the sports betting revenue and most of the profit came from football (over 50%), closely followed by basketball (more than 30%). Looking at the state’s gambling revenue as a whole, the figure is amazing and it shows no signs of dropping – quite the opposite.
In 2017, Nevada casinos as a whole managed to generate around $26.2 billion; in comparison, a quarter of a billion may not seem like much, but one has to bear in mind that only a couple of years ago, the revenue that was accumulated from the sports betting was almost 30 million lower. And this is only one state we are talking about multiply the potential revenue with the number of states ready to give clearance to the sports betting and you will get a mind spinning figure which is not even limited to a single sport as it was determined that the growth is coming from pretty much every field available for wagering. America, what are you waiting for?
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