Over the weekend, sports law and entertainment attorney Darren Heitner made his writing debut for OutKick, the sports media site founded by Clay Travis. Heitner’s inaugural piece defending the Vegas Golden Knights’ short-lived partnership with UpickTrade, a Mexican-based sports touting service, didn’t go over well with the sports betting community.
The partnership, which Heitner said was “no sin,” made Upick an “Official Sports Pick Service Partner” of the Sin City-based NHL team.
Heitner’s piece received backlash from Pushing The Odds host Matt Perrault, as well as others in the industry.
Let’s hope @DarrenHeitner sticks to law and contracts and stays out of the sports gambling arena. Jeez what a ridiculous take.
— Matt Perrault (@sportstalkmatt) February 27, 2021
The Knights’ initial decision was clearly not well-thought out, as demonstrated by the subsequent cancellation of said partnership. And Heitner’s defense of the deal was equally problematic. Heitner seemed somewhat confused by the animus from readers, but he shouldn’t have been. Defending the controversial tout industry will rarely get a round of applause from veterans in the sports betting community, and respondents were understandably frustrated with Heitner — who is clearly intelligent and has earned a large platform — not for his contrarian stance, but because, this time, he didn’t do his homework.
In sum, Heitner suggests sportsbooks and tout services are on par with each other, and that consumers are wise enough to decide whether the paid touts are worthwhile.
Let’s look closer at four points from Heitner’s article and where he went wrong:
1) “Is there really such a difference between partnering with a sports betting operator and a company that sells picks for people to consider using when transacting with those operators?”
Maybe we should assume this is an actual question — not a rhetorical one — because there’s no argument explaining why the two are analogous.
To answer Heitner’s question, though: Yes, there is a very big difference.
Sportsbooks are essentially market-makers. When you take into account the vig, it’s not easy to beat them, but there’s no question that sportsbooks are providing an entertainment service and meeting demands of consumers — in other words, it’s not a scam. Tout services, on the other hand, are charging premiums for “expert” picks, promoting themselves as a way to join the 1% of profitable sports bettors. But touts are not financial advisors managing retirement funds and stock portfolios. Unlike a growing economy, sports betting is a zero-sum game.
So the “services” provided by touts and those by sportsbooks are nothing alike. And expensive tout fees will only make it more difficult to beat the juice at sportsbooks.
2) “So why is it such a big deal that the Golden Knights have now associated with a company that simply provides information surrounding the sports betting activity that the NHL has impliedly, if not expressly, blessed by way of its myriad partnerships in the space?”
Sponsorship deals with sportsbooks do not impliedly bless sponsorships with anything or anyone associated with sports betting. The Knights have a myriad of partnerships in the health and fitness space, too — Planet Fitness, The Juice Standard, Gatorade, among others. Does Heitner think it’d be acceptable for the Knights to promote the multi-level-marketing company Herbalife as an official nutrition sponsor of the hockey team?
3) “The bottom line is that no one requires the general public to necessarily agree with the goods or services offered by every sports sponsor.”
While it’s not a requirement, per se, I can’t think of any cases where the general public disagrees with the goods and services offered by a sports sponsor — sportsbooks themselves certainly aren’t an example. According to a 2019 survey from the American Gaming Association, nearly 80% of Americans support legalizing sports betting in their state and a majority support the Supreme Court’s 2018 ruling that struck down the federal ban on sports betting. Odds are those numbers have steadily increased over the last two years.
4) “Ultimately, it is up to the consumer to decide whether the service and its pricing are worthwhile.”
As a laissez-faire type myself, I sympathize with where Heitner is coming from, but the argument is thin.
Heitner makes this claim, ignoring the fact that a major partnership with an NHL team would signal to sports betting newcomers that the product is legit — in this case a product where the landing page suggests they have turned “more than 6,000 clients around the world” into professional sports bettors.
An ambitious pitch indeed. Or sinful. Your choice.
The price tag for the supposed cheat sheet? $1,068 a year.
Moreover, just because one doesn’t support regulation of the tout industry doesn’t mean criticisms of a major sports team partnering with a tout service are unfair. In fact, watchdogs like Perrault are educating newcomers in the nascent sports betting ecosystem. Novice bettors quickly learn it’s tough to beat the books, but those unfamiliar with the tout industry can easily be convinced that the touts have the winning picks to help earn back their losses — and then some.
Similar to Upicks, former Philadelphia Phillies pitcher Michael Schwimer started a tout service called JAMBOS Picks in 2019, which ended as many had predicted. His explanation for discontinuing the service was that, “Unfortunately, pros/books have subscribed and built bots that move lines on release. We will have to stop selling picks very soon as it’s not in the best interest of subs.”
Though some question the truth of Schwimer’s claim, whether JAMBOS picks were in fact successful enough to draw attention from bots isn’t the point. As I wrote at the time, “The truth is that even if JAMBOS Picks, or any such tout service, had an edge, this is likely how it would end.”
JAMBOS wasn’t the first, and Upick won’t be the last.
Tout services aren’t going anywhere. But the least sports organizations can do is show a hint of what Whole Foods founder and former CEO John Mackey might call “conscious capitalism,” demonstrating social responsibility and “serving the interests of all stakeholders involved — not just corporate management and shareholders” by ignoring them.