U.S. Sports Betting Sector United In Focus On One Common Enemy

Executives from all corner of the legal sports betting industry agree that limiting the influence of illegal operators is essential.
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A casual follower of the U.S. legal, regulated sports betting industry might think that executives of a pro sports league, a leading sports TV provider, a casino gaming company, and a daily fantasy sports brand have their own individual focuses on expansion of the industry.

And while that is true to an extent, a panel of such executives at last week’s Global Gaming Expo (G2E) in Las Vegas revealed that all parties have substantially similar goals.

The key, though, is educating the American consumer on the difference between legal and illegal sports betting markets.

“We’ll generally do an exclusive [sponsorship] deal with a State Farm or Ikea, for instance,” NBA Senior Vice President Scott Kaufman-Ross told the audience on Thursday. “But we thought it was important to approach this one differently. We know a lot of our fans are choosing sports betting as a way to engage with our brand. So to make sure that is a truly great experience, we want to have partnerships with all of the licensed operators.

“Whether it’s our logos or marks, or anything else, we want our fans to see what products they can feel really comfortable with, to really differentiate legal operators from offshore operators. One of the reasons we have commercial partnerships with operators is we have an opportunity to collaborate on this type of thing.

“We know we can play a unique role there. And by creating a more pleasant betting experience, we know that will fuel still more innovation.”

A familiar tune

DraftKings Chief Business Officer Ezra Kucharz compared the current environment of sports betting to the downloading of music two decades ago.

“Think back to the streaming days of Napster, an illegal way for people to download music,” Kucharz said. “But once there was a legal way to do it, the whole market began to shift away. With sports betting now you hear horror stories about offshore sportsbooks,  so it’s more fun and easier to simply go through legal channels.”

Three other sports betting providers offered similar sentiments on Wednesday.

While ESPN has gone the exclusive route in its deal with Caesars Entertainment, Vice President of Business Development Mike Morrison said the company also supports that differentiation.

“What we wanted to do with our initial partnership was to offer, from the fan perspective, one provider,” said Morrison, whose company cites Caesars’ odds. “That gave us a unifying principle in our programming.”

That partnership will gather more strength next spring, when ESPN opens its new studio at the Caesars-owned Linq Hotel and Casino on the Las Vegas Strip. Another bonus: The NFL draft takes its show on the road to Las Vegas next year, about a month after ESPN’s new studio opens.

Jeff Eisenhart, MGM Resorts’ vice president of sports partnerships and activations, said that sports betting adds another layer of consumer engagement just as casino gambling, entertainment events, spas, and luxury suites do.

“Overall, getting ‘heads in beds’ remains a top priority,” Eisenhart said.

Why free games are still thriving

Kucharz said that “free to play” games have been offered by his company almost from day one, even though its daily fantasy sports sector is what has made it famous.

“Pick ’em games, bracket games — people who love to gamble also love to play free games,” said Kucharz, adding that the free games serve a business purpose as well: “There are a ton of brands just waking up to the sports betting market, and for many of them a first step into it is sponsoring free games. They are experimenting.”

Kaufman-Ross also said that league-sponsored free-to-play mobile phone contests, which the league launched in 2016, have multiple benefits.

“We are a national brand, and we are figuring out how to offer something for all fans when sports betting is legal in only a handful of states, and legal [on] mobile [in] even fewer,” Kaufman-Ross said. “It’s also important for us to identify fans interested in predictive gaming. This gives us that opportunity.”

But is there a risk of alienating diehard sports fans who have no interest in creating their own teams or risking money on the games? Kaufman-Ross pointed to experiments last season in Philadelphia and Washington, D.C. where a separate viewing platform was available that catered specifically to sports bettors.

On a separate note, Kaufman-Ross cited New Jersey’s “unbelievable” monthly sports betting numbers that show that more than 80% of all bets in the state are made on mobile apps. He also has been struck by statistics showing that “north of 50%” of wagers on NBA games are made in-game. Kucharz then informed Kaufman-Ross that the figure is “north of 70%” on DraftKings — a statistic that the NBA executive had not previously heard.

As for the explosion of partnerships across the U.S. sports betting sector, don’t look for a letup. While more than 50 have been announced in the past 18 months, moderator Casey Clark — an American Gaming Association executive — got a unanimous “over” vote from the panel on an over/under of 80 more being signed in the next 12 months.

Rounding up G2E highlights

I wrote a pair of articles from Las Vegas last week on the same subject: former New Jersey Gov. Chris Christie.

For US Bets, the focus was on Christie’s cautioning of U.S. gaming leaders — especially regulators — on what could lead the federal government back onto the sports betting trail after its sweeping PASPA law was vacated by the U.S. Supreme Court last year. It’s also worth a click to read about Christie talking Venmo, betting on U.S. elections, and whether he might join the national gaming sector on a full-time basis.

Over at Penn Bets, Christie’s description of Pennsylvania’s approach to sports betting as “a rolling dumpster fire” drew a lot of attention. But my story also details some behind-the-scenes information about the six-year legal saga won by New Jersey — and whether Christie is annoyed that in mid-2018 Delaware beat New Jersey by one week in becoming the second state with Las Vegas-style sports betting.

I also laid out the evolution of NHL Commissioner Gary Bettman, another key speaker at G2E, from unwavering opponent to tireless advocate of sports betting.

We covered the Wire Act of 1961 and whether it is still relevant to expansion of online gambling in 2019 and beyond. Experts weighed in at G2E on the New Hampshire court battle, and where we likely are headed.

Colleague Gary Rotstein also spent time with legendary bookmaker Jimmy Vaccaro in Las Vegas to get insight onto how casinos set — and constantly adjust — football betting lines.

What can casino-operators do to attract millennials who in many cases don’t — and may never — gamble? A UNLV professor offered some insights in another article by Rotstein.

Sports league officials like to talk a good game regarding “integrity” of their games, but New Jersey gaming regulator czar David Rebuck told a G2E audience that cooperation from the leagues has been a mixed bag so far.

As for the Gamble On podcast with my co-host Eric Raskin, AGA executives Casey Clark and David Forman were our guests in Las Vegas last week as we hosted the show live from the G2E floor.

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