States Racing to Gamblify Sports in FOMO of Neighbors Cashing In
Four years after the US Supreme Court allowed legalization of sports betting, states have found themselves in a “Wild West” situation with all racing to gamblify sports in fear of missing out (FOMO) on revenues if their neighboring states move faster.
Even a state like Texas which used to condemn gambling in the past is now considering joining the bandwagon of sports betting legalization, and the Democratic Party nominee for governor Beto O’Rourke has stated he would back up the move if he gets elected. At the same time, California has put several gambling and betting options on the general elections in November, and if the vote is positive for legalization, more jurisdictions are expected to follow the trend which has already swept 31 states.
An estimated $125 billion has been bet legally by Americans since the Supreme Court struck down in May 2018 the Professional and Amateur Sports Protection Act, a federal law dated 1992 prohibiting states to authorize betting on sport events. New Jersey was the first state to legalize sports gambling and in September 2021 became the first state to rake in $1 billion in bets within just one month. This year, the Super Bowl alone registered 80.1 million betting transactions totalling $8 billion in turnover, doubling on last year’s figures.
According to Keith Whyte, director of the National Council on Problem Gambling (NCPG), the US sports betting boom is only partially caused by the influx of new bettors as the majority of the current legal market participants used to bet underground before 2018. NCPG survey data reveals that 15 percent of Americans were betting regularly on sports before the Supreme Court decision, and now that number has risen to 25 percent.
“Before” and “After”
The major difference between the “before” and “after” ways of betting from the perspective of the average user is the speed, ease and accessibility of doing it now. While “before” a typical bet would be made during the week for a team winning or losing a Sunday game, with settlement occurring later in a physical meeting with the bookie, the “after” is more akin to a live casino online for real money experience with countless instant betting options on virtually any aspect of a game while the match is still underway.
Thus, sports betting veterans, who used to wait for days for a settlement, or even weeks to get their prize from an offshore site not being sure if they were actually going to get their money at all, now have a virtual gambling device in their pockets they can use any minute of the day and night with bet money going in and out of their accounts by the press of a button.
The Uncontained Gold Rush
Sports betting in the USA has become a true Gold Rush with dubious practices not being barred by any of the rules which have become typical of more mature sportsbook and casino game online markets like the UK.
Encouraging gambling on credit, limitless marketing, including ads featuring sports stars and movie celebrities, questionable sponsorship deals, open discussions on betting odds during live commentaries and event coverages, lack of responsible gambling guidelines and no requirements for social responsibility of operators, and in general no federal oversight on states’ actions, characterize the current modus operandi of the rapidly expanding US sports betting market.
In comparison, the UK has had a Gambling Commission since 1968 and modern gambling legislation since 2005. Currently, there is a voluntary “whistle-to-whistle” (from start to finish) ban on TV commercials during live sports broadcasts before 9 p.m., which has been active since 2019. Moreover, starting from this autumn, the UK’s Committee for Advertising Practice will ban soccer stars, celebrities and social media influencers from appearing in ads promoting gambling.
The UK is expected to ban gambling companies from appearing as shirt sponsors of teams by 2023, while in the US “sponsorships are something that firms and leagues and governments are putting all their effort behind,” Whyte says. The Washington Commanders received its own sports betting license in January 2021, becoming the first NFL team to do so. Universities are striking deals with gambling firms that can incentivise registrations among their students. All these developments raise justified concerns related to upcoming proliferation of match-fixing instances.
The Inevitable is Still Beyond the Horizon
Given the uncontained “Wild West” Gold Rush-type of expansion of sports betting business in the US and the history of rule formation in the UK, it is inevitable that restrictions will be at some point placed in America. These may come as state-level regulations varying from one jurisdiction to another, or the Congress may once again feel forced to place a federal ban. Until such a development is still beyond the horizon, however, states and companies have joined a race to exploit the current legalisation trends as much as possible while the gold is still there.