Now that the 2020 NFL schedule is out, you can go to any online sportsbook in America and check out its lines for the Week 1 games.
That includes Sports Bet Montana, the lone legal book in the Treasure State. Let’s have a look, shall we? The Eagles are favored by 6½ points at Washington. The Seahawks are 1½-point underdogs in Atlanta. The defending Super Bowl champion Chiefs are giving 9½ points at home against the Texans. All appears perfectly normal and reasonable, right?
Yes, it does — until you take a close look at the pricing. The standard at legal sportsbooks around the country is -110 on both sides, meaning the bettor risks $110 to win $100. Or if the action has been one-sided and movement is required to balance the books, you’ll often find -115 on one side and -105 on the other.
The house has an edge. But the game is not unbeatable.
In Montana, however, it just might be unbeatable. The house edge is comparable to the edge Dorothy’s house had on the Wicked Witch of the East.
If you want to bet on Philly or Washington in the state of Montana, the price on either is -118. You can get the Texans at -111, but the Chiefs are all the way up at -125. And there’s been a lot of action so far on Seattle, apparently, as the Falcons cost a modest -105, compared to a flabbergasting -133 on the Seahawks.
But, hey, it could be worse. When Montana’s betting app first launched in April, some games in some sports were priced at -133 on both sides. So they’re headed in the right direction.
Still, this is the most blatant example seen yet in the American regulated betting business of how badly a state can screw up the seemingly straightforward task of legalizing and launching sports wagering.
The New Jersey example is sitting right there
Since New Jersey became the first state to offer remote-registration online/mobile sports betting on Aug. 2, 2018, a blueprint for the vertical that is successful from the perspectives of the state, the operators, and the consumers has been free for all to see. It’s not perfect, of course. It’s not something that can’t possibly be improved upon. But New Jersey, with fairly wide-open competition, with a reasonable tax rate, and with a responsible state gaming enforcement agency, has demonstrated an approach that could serve as a starting point for almost any other jurisdiction.
A handful of states have taken the free advice and shortcuts New Jersey was handing out and done something similar — most notably Pennsylvania, Indiana, and new addition Colorado. Whenever major sports resume following the current COVID-19 shutdowns, those states will be positioned to house thriving sports betting industries that provide citizens with options and governments with tax dollars.
Montana is on the far opposite end of the spectrum.
For starters, the state decided to make sports betting a monopoly, handing full control to the Montana Lottery and vendor Intralot. On top of that, for now, “mobile” betting is not really mobile; yes, there’s an app where you can look up the odds, but you can only place bets at terminals installed in licensed bars and taverns.
And perhaps most significantly when it comes to the out-of-whack pricing, as SportsHandle reported last October, those “Lottery partner” taverns “get a six percent commission on the value of every ticket sold for sports betting.”
In a gambling vertical in which standard pricing creates a theoretical hold of 4.5%, a 6% guarantee for the host business means a high likelihood of the operator losing money. So Sports Bet Montana was left with almost no choice but to charge a vig that completely screws the bettor.
Can you choose the right side of the spread at least 54.12% of the time? You’d better if you want to break even in Montana.
Other wrong-headed states
Montana may be the all-around worst offender, but it’s far from the only jurisdiction choking the life out of a golden goose.
Any state that legalizes sports betting but not online/mobile sports betting is screwing it up and leaving the majority of its tax revenue on the table. During the pandemic, of course, there is no sports betting without mobile. But even before COVID-19 touched down, states like NJ and PA were closing in on 90% of betting handle coming via online.
So states like Arkansas, Mississippi, North Carolina, Washington (mobile betting inside casinos only doesn’t really count), and New York get failing grades until they modify their laws in a way that gives citizens a real alternative to unregulated offshore sportsbooks.
Then there are the jurisdictions with mobile betting but only a single operator allowed, giving consumers no opportunity to line shop. William Hill is the only game in town in Rhode Island, DraftKings has a monopoly in New Hampshire, and SBTech is providing the platform for Oregon’s lone virtual sportsbook — which proved particularly problematic when a cyberattack crashed SBTech’s sportsbooks for several days this spring.
In states with competition among sports betting operators, customers benefit in the form of special offers to acquire deposits and loyalty on top of the obvious opportunity to search for the most player-friendly odds. With monopolies, there are no such benefits and no need for operators to innovate, and the door is wide open for the sort of price gouging we’re seeing in Montana.
Speaking of which, Washington, D.C., is a threat to compete with Montana for the title of least-consumer-friendly sports betting jurisdiction whenever it launches. Like Montana, it awarded a monopoly on mobile betting to Intralot, and the stink of corruption that powered that contract hovers even before the first bet is placed.
One last state worth mentioning is Tennessee, which hasn’t launched its sports betting product yet either, but sure has threatened to cough up the ball numerous times on its way down the field. The state continues to insist on implementing a “payout cap,” which has vacillated between 85% (a disaster for bettors) and 95% (a manageable figure).
Ultimately, that could have the same effect as the 6% handle requirement going to host taverns in Montana. Even without a monopoly, the Volunteer State could force its sportsbooks to roll out lines reminiscent of the Sports Bet Montana app — which is to say, lines that nobody who aspires to win should bet into.
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