While internet wagering is on the lips of most gambling writers nowadays, sports betting is actually the topic du jour. New Jersey has passed a bill that will legalize sports betting in the state and are prepared to challenge PASPA in an effort to implement it. In fact Governor Christie is almost daring the DoJ and sports leagues to try and stop him. California also introduced a bill to legalize sports betting but will disallow wagering on California based NCAA teams or any college games that take place in the state and, like New Jersey, California is willing to take the issue as high as the Supreme Court if they need to. There’s no question that Delaware is still interested in offering single game sports betting and Nevada based American Gaming made a deal with William Hill to set up hundreds of sports betting kiosks throughout Nevada to generate more interest in sports betting as a betting option. Furthermore, reports suggest that least a dozen other states are seriously looking at introducing bills to legalize sports betting in their states and Canada is about to pass a single game sports betting bill that will allow their provincial governments to offer traditional sportsbooks in addition to the parlay lottery they have now. And not only does almost 20% of America’s population live less than a 5 hour drive from the Canadian border, but in Canada there is no tax on windfalls.
Yet despite the efforts of all the states to introduce sports as a betting option that they feel is necessary to prop up their casino and horse racing business, the sports leagues still maintain that they will vehemently challenge any efforts to introduce expanded sports betting in any state in order to “protect the integrity of the game.” However, if the leagues were smart they would give up this notion and try to figure out ways in which they could benefit from legalized sports wagering. Throughout the world sports betting is legal and sports teams have created partnerships with the bookmaking companies which have benefitted them greatly. In fact some of the most famous sports paraphernalia are from sportsbooks. Bwin, Betclic and Ladbrokes sponsor some of the most famous teams in Europe and Bet365 has deals with a couple of CFL franchises. And in Australia, almost every team is sponsored by a gambling company. It’s uncertain just how much money the leagues could make with sponsorships but a gaming conference in Montreal 8 years ago, Marc Blandford, the CEO of Sportingbet at the time said he would give $1 billion to the NFL if they would agree to allow the company to be “the official sportsbook of the NFL.” Naturally that offer was laughed off but many teams are struggling greatly and could use the influx of advertising revenue from sportsbooks if they were legalized. Without question teams like the Tampa Bay Lightning or Phoenix Coyotes in the NHL or the Buffalo Bills in the NFL would benefit greatly from sportsbook sponsorships and in NASCAR all the start and park teams could almost certainly pick up some sportsbook advertising which would allow them to run the whole race. It wasn’t that long ago when companies were lining up to sponsor race cars but the failing economy and the ban on tobacco and hard alcohol advertising has eroded that interest and consequently there is talk that the Craftsman Truck Series could end next year. It’s no longer the 1990s and companies like General Electric, General Mills and the Bank of America no longer have the resources to simply throw out money in hopes it may generate business. But the nature of bookmaking would certainly compel all legal sportsbooks to seek partnerships with teams in an effort to create awareness of their product. And like Betclic and Bwin, people would wear uniforms sporting their names and logos.
As for protecting the integrity of the game, legalized and regulated sports betting has actually been shown to be the best way to achieve that goal. Almost every famous gambling scandal in the past, including most recently the Ted Donaghy mess, was done with illegal, underground bookmakers. And it’s only after the fact when one of the cheaters makes a mistake that the truth comes out that leagues and the public are made aware of the scandal. In Europe, however, where gambling is legal, there have been quite a few betting scandals lately in horse racing, soccer, cricket and tennis, but unlike with Donaghy it was the bookmakers who notified the sports leagues about the likely cheating as a result of strange betting patterns. The unusual results in Ted Donaghy refereed games could have been spotted if the bets were made legally but because they were all conducted illegally, the sportsbooks couldn’t help. In fact Betfair, a major world gaming exchange, has initiated memoranda of understanding with over 40 leagues including horse racing boards, soccer leagues, the tennis federation and the NHL whereby any suspicious betting is reported to the leagues. With over 7 million transactions taking place on the exchange each day, all which are recorded and analyzed in real time by a designated integrity department, Betfair has been able to alert numerous leagues of suspicious betting patterns and it has led to arrests and suspensions in horse racing, soccer and tennis. And other bookmakers are following suit. In fact, Australia has it in their rules and regulations that licensed bookmakers must be on the lookout for illegal bets and report to them to the authorities immediately so that action can be taken. A major UK newspaper even stated recently “with the cooperation of the sports leagues and Betfair’s technology, cheating athletes know their days of deception are numbered.” Yet for some reason, North American sports leagues (with the exception of the NHL), have preferred to keep their head in the sand and pretend that gambling doesn’t take place on their games. Obviously they know otherwise but they would rather take the approach that what they don’t know won’t hurt them, rather than facing reality. Gambling does take place every day and some sports even rely on it. There’s absolutely no question the NFL would not be as popular as it is today if there weren’t NFL pools taking place in offices every weekend and if the point spreads weren’t posted in every major newspaper. And contrary to what the leagues may believe it’s better to learn about cheating ahead of time and be proactive rather than just reacting to the news.
Another reason the leagues should consider embracing sports betting now is because at this point they have some leverage in adopting regulations for sports betting. California, as mentioned, has put in a rule disallowing college betting on sports within the state and no doubt other states that are interested in sports betting would be willing to follow suit if it means they don’t have to go through the legal process of challenging PASPA. In fact the leagues can even put in regulations relating to who can’t bet on sports (i.e. disallow players or referees from placing bets on their sport) and can possibly even work in a percentage of the revenues from the betting to be used towards scholarships, increased minimum salaries and the like. But if the leagues choose to continue to challenge it and if the courts eventually rule against PASPA, and almost every gambling lawyer I spoke to believes PASPA will be determined to be unconstitutional at some point, the states and gambling companies will have no reason to work with the leagues to give them a share of the revenue or ask for their input. Once sports betting is declared legal, the states will say to the leagues “you had your chance and you blew it,” just as the leagues are telling New Jersey for opting out of PASPA two decades ago.
This is crunch time for sports betting in the U.S. Legalized wagering on sports will happen in every state that wants it sooner or later and there’s absolutely nothing the leagues can do about it. They may own their trademarks and patents but they don’t own the right to stop gambling on it. Sports betting has taken place in Nevada for over 70 years and it has taken place underground for far longer than that. It’s time for the leagues to face reality and work with the states to come up with a solution that they all can live with. Failing to do so will just leave the leagues on the outside looking in and when the leagues want some revenue and input into the betting the states will simply tell them “you had your chance and you blew it.”
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