A few years ago, following the May 2018 SCOTUS decision that gave states the right to legalize sports betting in their own jurisdictions, Congress began hearings regarding the option to place US sports betting under some kind of national legislative infrastructure. Three years down the road, those discussions have stalled as momentum for such legislation seems to have dried up.
The Supreme Court’s 2018 decision invalidated the 1992 Professional and Amateur Sports Protection Act of 1992. PASPA effectively outlawed sports betting except for in a few states where sports betting was already legal. The Court’s decision that PASPA was unconstitutional started a movement that has seen more than 2 dozen U.S. states make some type of sports betting legal for their state’s residents -– in some states, only in-person sports betting is legal while in other states you can be on sports either in-person or online. One state – Tennessee – allows sports betting only at an online no deposit bonus casino.
Congress was encouraged to push national sports betting legislation by multiple considerations – to protect league interests, to relate to demands of gaming tribes, to relate to sportsbooks and fantasy sports industry expectations and to placate the Vegas casino industry.
Three years down the road, interest seems to have waned, both on the part of Congress, which is not being pushed by industry interests, and by the industry itself, which sees that it is doing quite well without the intervention of nationwide legislation.
Leagues
The leagues, which once spoke with a unified voice in their opposition to legalizing sports betting and then joined forces to encourage Congress to enact national sports betting legislation, are now quite pleased with the current situation. With wagering sanctioned in half of U.S. states either in-person or online, the leagues see revenue skyrocketing from partnerships that they’ve established with sportsbooks, casinos and other betting venues.
The The National Football League (NFL) is partnered with FOX Bet, PointsBet, WynnBET and BetMGM which are the league’s Approved Sportsbook Operators for the 2021 NFL season. Many individual NFL teams have also created partnerships including the New York Giants with DraftKings, the JETS with BetMGM, Philadelphia Eagles with FOXBet and DraftKings, the Indianapolis Colts and Chicago Bears with PointsBet, The Tennessee Titans with BetMGM and the Denver Broncos with Betfred USA, BetMGM and FanDuel.
Similar partnerships have been announced between NBA teams (Indian Pacers, Philadelphis 76ers), MBL teams (Colorado Rockies, Chicago Cubs, Detroit Tigers and NHL teams (Vegas Golden Knights, Pittsburgh Penguins, Chicago Avalanche, New Jersey Devils and Philadelphia Flyers).
These partnerships range from making the partners the “official” team sportsbook to allowing them access to in-stadium and digital advertising space, enabling branding integration with the team’s social media and other digital channels, giving the partner the opportunity to become an official sponsor of team products, providing the partner a presence at the team’s home stadium, giving visibility during in-game moments, video board replays, and delivering marketing access to teams’ digital, billboard, radio and other in-arena assets.
New Perspective
The new perspective has caused the teams to drop lobbying efforts like a hot potato. In 2018, right after the SCOTUS ruling, the American Gaming Association released a study that projected that, within a few years, the four major sports leagues would be able to earn as much as $4.2 billion from legal sports betting as it is currently set up – through individual states’ legislations. That was before a tsunami of states began legalizing sports betting – 25 in just 3 years – and before gambling increased appreciably during the pandemic shutdowns. The report also noted that legal sports betting has the potential to create substantial opportunities for the economy through jobs, tax revenues and the support that it gives to small businesses.
In addition to the partnerships, the leagues and the teams are seeing other streams of revenue including revenue from betting operators’ spending on data, sponsorships and advertising as well as revenue generated by heightened consumption of league and team media and products.
Long Road
When, in 2012, New Jersey started the process that would land them in front of the Supreme Court 6 years later to fight for their right to legalize sports betting, league officials spoke out strongly against the state’s intentions. Bud Selig, then Commissioner of Baseball and today the Commissioner Emeritus of Baseball, said that he was “appalled” at the move to legalize sports betting outside Nevada. Sports betting is, said Selig, “evil, creates doubt and destroys your sport.”
Those sentiments were echoed by other officials from the other major leagues who argued that allowing sports betting could potentially compromise players and other team support staff. The leagues were active in the SCOTUS case where their lawyers argued passionately against any move to allow legal sports betting.
Today, there’s almost unanimous agreement that the leagues and the teams have much more to gain than to lose by becoming involved in the sports betting market. They don’t want Congress to do anything to change the status quo which is working very well for them.
Without the kind of lobbying that elected officials had been seeing before the leagues saw the light, there’s no impetus for Congress to make any changes. Anti-gambling groups don’t have the kind of political power needed to effect the kind of change that would impact negatively on the multi-billion dollar industry.
As Sports Illustrated predicted in a 1974 article, “The most likely source of income for sport in the future will be gambling money. Few realists doubt it.”
