7 Predictions for Sports Betting in the US in 2020
Welcome to my predictions roundup for American sports betting in 2020! How well did my crystal ball work a year ago? Let’s review my 2019 predictions.
I predicted 30+ states would introduce bills, and 35 did. I predicted eight states would actually get the job done, and 10 new states rose to the occasion. While some of these states are still working through drafting regulations and have yet to launch, and some states only allowed sports betting at commercial or tribal casinos, 2019 was a massive step forward for American sports betting.
I predicted a bill to regulate sports betting at the federal level would fail. No bill got past the drafting stage. There was certainly some unwelcome noise on the federal level when the U.S. Department of Justice decided to rewrite history and the law by declaring all forms of gambling to be subject to the Wire Act. But this threat has subsided now that the courts have reinstated the status quo.
I predicted that a lottery-based sports betting model would be a disaster. Washington, D.C. proved me correct with a scandal and lawsuit-laden dumpster fire that has left D.C. without legal online sports betting options for a year and counting. While the Oregon and Rhode Island lotteries at least have functioning sports betting apps, the revenue has been immaterial. Other states need to take notice: A single state-run operator is never going to create meaningful revenue, consumer excitement or dent the thriving offshore market.
I predicted that a state with no casinos would pass sports betting. Tennessee delivered a mobile sports betting framework without any requirements for operators to partner with existing endemic operators … as there are none in Tennessee. Look for Tennessee’s sports betting market to shoot out of the gate in 2020.
I predicted that NASCAR and second-tier sports leagues will make a strong investment in sports betting. That held true. NASCAR rolled out a proprietary data deal and real-time betting options. While the upstart American Alliance of Football never made it off the ground, their next-level betting technology could wind up repurposed as other leagues look to expand their in-play betting possibilities.
Finally, I predicted that New Jersey would continue to grow on the strength of their best-in-class mobile options, but that Nevada would remain the national leader in revenue. While Nevada may inch out New Jersey over the entirety of 2019, the Garden State has paced the nation in revenue for three months. The message is clear – New Jersey is only growing stronger and Nevada must innovate or risk losing the throne.
As for 2020, here is what’s in store:
1. Eight or More States Will Add Mobile Sports Betting
Eight was my prediction last year and I’m going with it again, but with a different wrinkle. Last year, I focused on how many states would authorize sports betting of any kind, and four of those states only went so far as to allow in-casino sportsbooks. For all intents and purposes, a state that limits betting to casinos is of little consequence to modern bettors. Without mobile, these states are hardly scratching the surface in terms of what is possible. So, this year my focus is on how many states will do the correct and obvious thing by authorizing mobile.
There are some states that will be trying to authorize sports betting for the first time. Unfortunately, some major states such as California and Oklahoma face complex tribal situations that will make sports betting legislation too big of a lift. Texas won’t even meet in 2020 and you have some states where gambling expansion just isn’t on the table. But there are still some very large prizes at stake, and I would expect the middle of the map to again be an active area for sports betting legislation. States such as Ohio, Missouri and Kansas all have a good shot at accomplishing this goal. On the Eastern seaboard there’s a strong chance that Massachusetts, Connecticut and Virginia, or some combination of these states, get the job done.
As for states that have retail sports betting but lack mobile, there are a few that can make this leap in 2020. Arkansas is apparently slowly warming up to this. North Carolina broke the ice with a tribal casino sports betting bill last year and could be ready for the real deal. Mississippi’s conservative but cash-strapped legislature could consider taking the next step. Of course, everyone will be focusing on New York, which came close but fell short of mobile authorization in 2019 and will have proponents and industry stakeholders champing at the bit. I expect at least one of my eight to be a state that adds mobile to a previously retail only framework after being disappointed with the purely land-based tax revenue.
Between these states, plus perhaps a pleasant surprise or two from places such as Minnesota or Kentucky, the mobile sports betting market in the U.S. should continue to see remarkable growth in the coming year and beyond.
2. Nevada Will Come Under Pressure to Modernize as it is Eclipsed by New Jersey
New Jersey has already established itself as the leader in sports betting innovation. But Nevada won’t be going away any time soon. The question in 2020 will be whether New Jersey can continue to stay atop the wave of sports betting excitement and maintain its regional dominance, or if neighboring states such as Pennsylvania and New York can siphon off some of this action. Pennsylvania had a slow start but is starting to flex its muscles with strong growth in mobile revenues. If New York can get its act together, it will reclaim a significant chunk of sports betting revenue from city dwellers who cross the Hudson to bet.
Regardless of what other states do, New Jersey’s future is incredibly bright. Just look at how far they’ve come in a year. In November New Jersey did $563 million in handle, nearly double the handle from November 2018. If the stars continue to align, the sky is the limit for New Jersey with a billion in handle in a single month not out of the question.
Nevada will get a boost when the NFL’s Raiders christen their new home on the Las Vegas strip. But sportsbooks in the state will also have to get with the times. Sports betting apps outside Nevada have far more in-game betting options. Nevada’s technological complacency will stick out like a sore thumb once visitors to Las Vegas realize the mobile sportsbooks they use back home are actually better than what is available in Sin City.
I predict New Jersey will formally eclipse Nevada by beating on most if not all measures in 2020. Nevada itself will show decent growth but not enough to remain the leader. Despite Nevada’s place as the spiritual home of sports betting, there are more people, more mobile devices and more money in New Jersey.
3. A Tribe Will Offer Statewide Mobile Sports Betting in 2020
To date, tribes have been the outlier when it comes to mobile sports betting. Even though tribes are a tremendous presence in the casino gaming ecosystem in more than a dozen states, the federal laws that allow tribal casinos to operate are simply not conducive to mobile betting conducted off of tribal lands. In part because of legal uncertainties that complicate their statewide operation, several state legislatures are working with tribes to expand this framework in a promising direction.
The downside for tribes is that they will likely have to be subjected to state regulation and taxation, things that are non-starters under the federal framework. But the upside – expanding their reach and reaping the financial benefits of mobile sports betting – may be worth it. Tribes in Connecticut, Michigan, North Carolina and Arizona seem likely to at least consider this tradeoff in 2020. I’m predicting that at least one tribe will strike a deal to expand their mobile sportsbook beyond tribal lands.
4. Pro Teams Will Strike Gambling Partnerships in a Big Way
As acceptance of sports betting grows across the country, and in particular with sports executives, so will the advertising opportunities. It won’t be long at all until most U.S. stadiums have some form of official sports betting sponsor, whether it be an official sportsbook partner or a marketing deal that allows signage at arenas. In fact, we have already seen deals struck in Washington, D.C., New Jersey and Pennsylvania with more coming soon in Illinois. You may not see branding on pro team jerseys immediately, but the practice is ubiquitous in the English Premier League and it’s not a stretch to imagine betting companies will continue to create cozier relationships with team executives.
For sports franchises, the connection is a no-brainer. Sports betting furthers engagement opportunities and brings more eyes to their games. Likewise for betting operators, their ability to get visibility on the biggest stages in pro sports lends them a certain credibility and distinguishes them from the masses of other companies out there.
While watching the game in the comfort of your own home with a fancy new sports betting app is a great experience, teams are trying to figure out how to keep sports bettors coming into the stadiums. Football stadiums aren’t like horse tracks, where the venue itself is practically a conduit for betting. But that doesn’t mean that stadiums won’t offer specialized amenities and on-site locations for fans to take their in-game wagering to the next level. Sports teams will be offering discounted tickets and VIP amenities for sports bettors in 2020.
I anticipate that some will make the leap to offering exclusive in-game wagering opportunities only for fans and bettors within these stadiums. If there’s one thing pro sports organizations are good at, its finding ways to get fans to spend – there’s no chance they squander this golden opportunity.
5. The Wire Act Controversy Will End and Federal Legislation Will Fail
Earlier this year, the Department of Justice did Sheldon Adelson a favor by attempting to reinterpret the long-standing discernment that the Wire Act does not apply to anything beyond sports betting. While this ruling instilled temporary fear into state lotteries and online gambling operators, the New Hampshire District Court shot down the DOJ in no uncertain terms. While the DOJ may appeal this ruling as a face-saving measure, they have their hands full with plenty of other high drama and may elect to slink away in defeat. Either way, the real controversy should be over and done with.
We can also expect the prospects of federal sports betting regulation to continue to shrink. As more states develop regulations on sports betting, the utility of a federal framework dwindles. A bill to allow for interstate sports wagering would be a welcome development, but nobody is really expecting this to be a realistic outcome any time soon. In 2020, no news from Congress or the DOJ will be good news.
6. Meaningful Run at Sports Betting in Florida Sets off Fireworks
Floridians overwhelmingly voted to make the expansion of casino gambling more difficult in their state with a 2018 voter referendum. But it remains an open question whether sports betting is included under the umbrella of “casino gambling.” The answer depends on who you ask, and if you happen to be the Seminole Tribe, which operates Hard Rock casinos across Florida and the rest of the U.S., the answer is “no” … so long as the tribe gets a monopoly on sports betting.
The many legislators in Florida who want to see sports betting taxed for education dollars would also like to see an accommodating interpretation of the 2018 referendum. Florida flirted with the idea of sports betting legislation last year, but now that the dust of Amendment 3 has settled, it is entirely likely we will see a renewed push to legalize sports betting in 2020. Anti-gambling groups will certainly back a strict interpretation of the referendum result, so expect fireworks in the courtroom the second legislative progress is made.
With the 2020 and 2021 Super Bowls taking place in the Sunshine State, lawmakers have two perfect excuses to push sports betting up the agenda. Florida would be a tremendous market for America’s new favorite pastime. The industry will be watching closely to see if, and how, the key stakeholders signal their intent heading into next legislative session.
7. Ohio’s Struggle to Legalize Sports Betting Continues
In 2019, Ohio was inexplicably unable to reach consensus on policy decisions that have been dispensed with quickly and effectively in other states. Instead the Buckeye State is still hung up on baseline, no-brainer questions such as whether to allow mobile sports betting. Meanwhile, Ohio is losing money on all sides – Indiana, Pennsylvania and West Virginia all have mobile sports betting and thus Ohio residents are driving across state lines to place bets. Michigan will very likely have sports betting in 2020, maybe even Kentucky. Ohio has made no tangible progress thus far and it won’t get any easier in an election year.
Another major concern in Ohio is whether college sports betting will be permitted. An imposing coalition of Ohio universities has mobilized against allowing college bets, telling lawmakers that such betting increases pressure on student athletes to throw games or leak sensitive information. That’s well and good, but it ignores the fact that this betting is happening right now – there’s no shortage of places to bet on college sports. Legalizing betting on college games won’t increase these pressures, it will just bring this betting into the light and allow it to be regulated in ways that provide far more protection to student athletes.
The losers in all of this are the fans and people who would love to place bets if they had a legal outlet to do it. The other losers are state and local governments. They are watching tens of millions in potential tax revenue vanish into the pockets of offshore bookies and neighboring states.
Charles Gillespie is CEO of Gambling.com Group.
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