Betting on Sports America: Live Updates

Betting on Sports America: Live Updates

The 2019 Betting on Sports America conference brings together many of the most high-profile leaders of the North American gaming market. Highlighted by a keynote address from New Jersey Gov. Phil Murphy, the conference will showcase the latest developments in technology, regulation and every other facet of the quickly growing U.S. sports betting industry and American gaming as a whole.

Our team is on the ground for the conference in Secaucus, New Jersey, attending seminars, interviewing newsmakers and soaking in the sights and scenes of the top gaming conference in the country.


Time May be the Biggest Sports Betting Obstacle

Any sports betting legalization bill faces multiple challenges and concerns over taxation, implementation, access and a host of other issues – and that’s in states that have the political appetite to take up a proposal in the first place. While lawmakers wade through those issues, the cycles of timing from within state capitols may very well be the most significant obstacle to climb.

During the conference, gaming industry attorneys, lobbyists and other leading figures from across the country acknowledged that the often times arcane and laborious traditions of the legislative process can be among the biggest deterrents to sports wagering legalization. Even when the political appetite exists, the rhythms of legislative sessions often times precludes any action.

Massachusetts serves a classic example. Lawmakers have introduced 10 bills to legalize sports betting this year, including one sponsored by Gov. Charlie Baker, which further underscores the urgency to take action in the state.

Several months after their introduction, significant action still hasn’t taken place.

That’s largely due to the traditional pace of legislation in Boston, said Greenberg Traurig attorney Mark Hichar. Legislation is typically introduced early in the calendar, but lawmakers don’t usually make progress on many of the early proposals until May.

The good news is that “action time” is getting close. With high-profile backers in the legislature as well as the governor’s mansion, sports betting will be impossible to ignore. It just appears Massachusetts will go about it in its own time.

Mississippi lawmakers also like to go about legislation at deliberate pace. But it appears there’s will be much, much slower than Massachusetts – or most other states.

The Magnolia State likely won’t take up a mobile sports betting provision until 2022 or 2023, according to Thomas Shepherd III, a partner at Jones Walker LLP. Lawmakers punted on any legislation to permit mobile betting from outside casinos during the already concluded 2019 session and seem unlikely to do so either of the next two years.

Shepherd said lawmakers in Jackson seldom take up controversial legislation in election years, all-but ruling out what would likely be a contentious debate in the state house in 2020. With a new governor taking office in 2021, and a crop of rookie lawmakers still working through the ins and outs of the legislative process, mobile sports betting likely won’t come in that year either.

Movements in Louisiana, Tennessee and Arkansas could shake Mississippi from its cycle, but officials are still not expecting mobile betting any time soon. Mississippi was one of the first states to approve legal wagering, but did so as corollary to a daily fantasy bill and when a federal ban superseded it from coming into fruition.

Mississippi gained legal sports betting more quickly than any lawmakers would have anticipated when the Supreme Court unexpectedly heard a legal challenge to the federal sports betting ban and then found it unconstitutional: sports betting came as part of an unforeseen set of circumstances, not some proactive legislative maneuvers.

4:25 p.m., April 25 – Ryan Butler


NHL Sees Mobile, Fan Engagement as Keys to Revenue

That the proliferation of legal sports betting could create a new stream of revenue for professional sports leagues is not a new concept. But National Hockey League chief revenue officer Keith Wachtel thinks some are misreading just how this would-be windfall will arrive. And why maybe it won’t.

Sponsorships with betting entities will not be the source, he said.

It will come through fan engagement which, speaking specifically of the NHL, could yield new fans and more bountiful rights deals.

Mobile Critical to Growth

And in an indication of just how savvy he has become on his new purview, Wachtel noted on Thursday at the Sports Betting America conference that whole process could be ruined for leagues and state’s implementing sports betting laws unless mobile wagering is a component. Indiana’s bill, which awaits its governor’s signature, includes mobile.

“If you think, today it’s a nice small opportunity for all of us from a financial standpoint,” Wachtel said, “but as you look three, four, five years down the road, when the estimates are 30 percent or 40 percent of this country is going to be able to bet, hopefully, from a mobile device, now you’re talking about scale that perhaps we haven’t been able to reach.

“For a sport like ours, if you look at the big four, our handle is by far the lowest. We have the opportunity to grow that and we saw that in Las Vegas. More people percentage-wise have bet on the sport of hockey in the last two years than other sports from a growth standpoint.

“It’s still much smaller in comparison to the other sports leagues, but we feel there is potential for that to grow. When that grows, that just means that’s going to be more engagement. And then you take the casual fan, maybe someone that’s not interested in the sport of hockey, but they bet on it, and then when they bet on it, then maybe they’re going to watch. Once they watch, or once they attend a game, we think now we have them.”

Wachtel said franchise owners regard sports betting sponsorships as a “nice category,” but said these monies are not sufficient “where owners are sitting there thinking this is the .com of 20 years ago.”

State Houses Need to Pay Attention to NJ Experience

And the key to these bottom lines could ultimately be determined in state houses where sports betting bills are being discussed. Upwards of 75 percent of New Jersey’s sports betting handle comes from mobile devices but most states have failed to follow its lead. Pennsylvania should come online with mobile platforms soon. That’s not enough, Wachtel said.

“We have markets that are now trying to legalize sports betting without the idea of having mobile. People are talking about the notion that the revenues aren’t as big in states that they thought they were going to be,” Wachtel explained. “Well, if you don’t have mobile betting in today’s day and age, why are you even considering it?

“Brick-and-mortar is great, but even ask someone from Las Vegas what is happening in that market place. People want to bet or engage wherever they are, and that’s the beauty of mobile gaming. So, for us, the primary benefit is if there’s more people engaging your sport, it’s going to affect whether it’s television ratings, digital consumption, streaming, that ultimately leads to increased rights deals: broadcast rights, digital rights. That's where leagues, properties make a lot of money.”

2:30 p.m., April 25 – Brant James


Sports Betting in for Frenetic Finish in 2019

The noticeable dearth of successful sports betting legalization bills could soon come to an end.

Michigan, Ohio, Illinois, New Hampshire, Massachusetts and Maine could all be among states that legalize wagering on sporting events this year, according to panelists at a conference session Thursday morning. Though significant obstacles remain, legalization efforts are growing after a slow start earlier this year.

Moves by these states, and multiple others, comes as three states legislatures have passed their respective bills and now await final approval from their governors. Indiana, Iowa and Montana could all legalize sports betting by the end of the month – or possibly the end of this conference.

Meanwhile, unexpected progress in Tennessee and Colorado means they too could join this list.

Conference attendees have closely monitored their progress this week, and every indication from this morning’s session (aptly titled “USA Betting 2019: Which States Are In And Which Are Coming?”) is that the attention will be warranted.

11:04 a.m., April 25 – Ryan Butler


Where Major States Stand

The conference has been a rich resource for the latest developments in sports betting legalization efforts across the country.

California

It won’t be among the earliest sports betting adaptor, but the world’s fifth-largest economy may just have a timeline for legal wagering.

Steve Bodmer, General Counsel for the Pechanga Indian Reservation, says California sports betting could be determined by voters in 2020. The state constitution mandates approval from a majority of voters via a ballot referendum, and industry observers believe its possible that could come as part of the 2020 elections. If approved, that would mean legal wagering in 2021.

But speaking during a conference seminar, Bodmer cautioned would-be California bettors.

Complex and often times divergent goals by the state’s Native American-owned gaming entities, as well as competing interests from stakeholders of the state’s card rooms and horse tracks will not be easy to navigate. That will likely force a stalemate in the legislature, which has largely ignored gaming expansion measures in the first place.

A ballot measure, where voters would decide the fate of legal wagering, is likely the best (and possibly only) solution, Bodmer said. Up until if, and when, that happens, California will remain one of the most closely watched states by industry officials. Far and away the largest state by population (and gaming revenue potential), California has long been the most coveted jurisdiction for sports betting enthusiasts.

New York

Four commercial upstate casinos have garnered most of the attention about New York sports wagering, but the Empire State’s Native American casinos don’t intend to be left out of the action.

Approved even before the federal ban was struck down, New York’s four commercial casinos will finally start taking bets sometime this year. They’ll be joined by some, if not all, of the competing Native American casinos eager to take advantage of the new wagering opportunity.

New York law allows the Native American casinos the same game offerings as the commercial casinos, meaning no further action is needed in the legislature. With state gaming regulators finally completing rules to take bets, New York visitors and residents will soon have plenty of in-person options to place a legal sports bet.

Oklahoma

Oklahoma officials say the state will have sports betting. They just aren’t sure when.

The state’s tribes and lawmakers are prioritizing negotiations over a new gaming compact before they dive into sports betting, said Shelia Morago, Executive Director of the Oklahoma Indian Gaming Association. Though there’s interest from both parties, Morago said there’s no motivation to allow wagering on sporting events until this pivotal agreement between the tribal-owned gaming entities and elected officials is finalized.

The good news is that if no agreement is reached, the existing compact will remain in effect for 15 years. That means there will not be a lengthy stalemate that could derail future negotiations, and sports betting can proceed.

When that happens remains to be seen. Key questions about mobile access, tax rates and a host of other key regulatory issues are also undetermined. Still, Oklahoma is patiently waiting for what appears to be the inevitable opportunity for its numerous tribal casinos to take sports bets.

4:03 p.m., April 24 – Ryan Butler


NJ’s Rebuck Knows Time is of the Essence

New Jersey governor Phil Murphy placed the first two legal sports bets in his state last June. Germany didn’t win the World Cup and the Devils failed to capture the Stanley Cup, but Murphy was a winner in watching his state become the model of implementing legal sports betting and a benefactor of more than $2.3 million in wagers since his first wager last June at Monmouth Park.

Speaking as keynote at the Betting on Sports America conference at the Meadowlands Exposition Center on Wednesday, Murphy doubled down, asserting emphatically that he had been advised by “experts” that New Jersey would eclipse the decades-old market of Nevada by next year.

The man in charge of regulating and perpetuating New Jersey’s boom, Division of Gaming Enforcement director David Rebuck, told Gambling.com in January that he was unsure that the state could ever eclipse what in 2018 was a record $5 billion sports betting handle generated by the tourism and gaming epicenter of Las Vegas.

Strolling the floor of the trade show on Wednesday, he expressed more confidence that it could happen, but reaffirmed factors that lead him to believe he’d better accomplish it quickly. Because it probably can’t last.

Because although New Jersey’s sports betting continues to flourish, forces outside of its control and beyond its geo-fenced gaming borders matter greatly.

“Right now, I think, on the East Coast we're kind of like the only game in town,” Rebuck told Gambling.com. “Delaware is very small operation because it's small population. They're very good at what they do, but it doesn't influence what happens in New Jersey.

“Pennsylvania has been opening the retail establishment, but has been slow to expand and you've seen their numbers, but it's 12, 13 million people there in that state. And over time when they get going, they're going to do it well.

”I think then you're going to have that impact on our online. [Bettors] can create their own online account when they’re in their state and people either travel or work between states, which is very common in the East Coast. We'll probably lose that market.”

The slow pace and likely limited rollout of wagering in New York also benefits New Jersey with each customer that rolls over the George Washington Bridge.

“What's going to happen in this thing for us is as long as New York continues to wait, that helps New Jersey,” Rebuck said. “So those geographic factors. One only needs to look at how gambling works, retail, to understand the regionalization of gambling in that ultimately you hit a wall because you're essentially appealing to your own people, your own residents or the regional aspects of what you have in your state.”

But for now, Rebuck has a window – albeit closing – and a quasi-deadline.

Then what?

“Then I’ll retire,” he laughed.

2:55 p.m., April 24 – Brant James


Wire Act Could End Online Gaming – Maybe

A year ago, the federal ban on sports betting hung like a dark cloud over the American gaming industry. A Department of Justice decision is doing the same this year.

The DOJ's revised opinion on the 1961 Federal Wire Act could, in theory, ban online gaming in all forms. Justice Department officials argue the law, passed long before the internet was widely available to the public, prohibits the payment or information transfer from any gaming entity across state lines. With nearly every transaction, payment processing or data transmission in some way crossing state lines, it could mean the end of online gaming.

Mark Hichar, a Betting on Sports panelist and Greenberg Traurig shareholder, said its no surprise this is leading to chaos in the industry.

“It’s a bit of a head-scratching," Hichar said, "it's a bit of a panic.”

The New Hampshire Lottery has spearheaded a legal challenge to prohibit this new DOJ ruling. While the First Circuit Court was amenable to the plaintiff's arguments during a hearing earlier this month, a final decision, which could come as early as this week, still remains undetermined. Either way, the losing party will likely continue to challenge this decision in a higher court.

This is part of the reason why panelist at a discussion on the Wire Act and payment processing believe the court will have to make a decision. There seems like appetite, or ability, for Congress to update the Wire Act. That means the objectively ambiguous piece of legislation will continue to loom over the heads of the collective industry until the courts (finally) determine what it actually does.

2:41 p.m., April 24 – Ryan Butler


‘Sheer Craziness’: Former Athletes Discuss Sports Betting

Ryan Howard and Brian Westbrook made a name for themselves as some of the best professional athletes of the generation. Now they're trying to rise to the top of legal sports betting.

Howard, the former MVP first baseman for the Philadelphia Phillies, and Brian Westbrook, a multiple-time Pro Bowler with the Philadelphia Eagles, both spoke about the potential for legal sports betting during a conference seminar.

"It's sheer craziness," Howard said. "The sky is the limit."

Since retirement, Howard has joined SeventySix Capital as a Partner and Chairman of the company's Athlete Venture Group. Westbrook, who starred on the gridiron in Philadelphia during many of the same years Howard was terrorizing pitchers on the diamond, has joined SeventySix Capital as an investor and member.

Both former athletes agreed that much of the future of sports gambling lies in statistical insights. With unprecedented access to this information, the randomness of wagering has diminished, Westbrook said, providing more opportunities for bettors.

11:39 a.m., April 24 – Ryan Butler


First Panel Provides Industry Insights

The event's first speakers made headlines early.

William Pascrell III, a partner at Princeton Public Affairs Groups and one of the driving forces behind New Jersey's sports betting legalization efforts, told attendees a ruling could come on the Federal Wire Act legal challenge as soon as Thursday. A Department of Justice reinterpretation of the 1961 act could prohibit all forms of online gaming, potentially hindering or even outlawing cross-state casino gaming, poker and lotteries.

Not surprisingly, these gaming entities have challenged the new opinion on the law in court. After a hearing in court earlier this month, the entire industry is eagerly awaiting the court's decision, which could drastically shape the future of legal gaming.

Later in the early session, seminar panelist Chantal Cipriano helped shine light on an untapped gaming market up north. A lawyer with Dickinson Wright based in Toronto, Cipriano said Canada is getting closer than ever to legalizing single-game sports wagering. In part pushed by efforts in Michigan, New York and other states, Cipriano said she's optimistic that Canada will embrace sports betting in the not-too-distant future.

The key is an adjustment to federal law. Led by Ontario, Cipriano said the nation's provinces are pushing for legal sports wagering, but are handcuffed by federal restrictions. Provinces will need to continue to push for sports betting at the federal level in order to come to fruition.

10:50 a.m., April 24 – Ryan Butler

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