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How Sports Betting in America Completed its 3-year Evolution from Taboo to Legitimate Revenues

For the longest time, sports betting in America was limited to Las Vegas only. Placing wagers on sports, one of the country’s oldest activities had been downgraded to near-obscurity in every other place. However, on May 14, 2018, the Supreme Court of the U.S. ruled out the federal law that had confined regulated sports betting to Las Vegas for over two decades.

People watching football at bar

Image: Financial Times/Getty Images

For the longest time, sports betting in America was limited to Las Vegas only. Placing wagers on sports, one of the country’s oldest activities had been downgraded to near-obscurity in every other place. However, on May 14, 2018, the Supreme Court of the U.S. ruled out the federal law that had confined regulated sports betting to Las Vegas for over two decades. 

Before the ruling, major leagues across the country, including the NFL, had maintained that allowing other states to join in the sports betting business would see bettors and bookmakers bring about irrevocable damage to sports in the U.S. Sports betting and bookmaking was rarely talked about by the media. Except for a handful of subtle references to the harm broadcasters claimed it posed.

Three years on from that Supreme Court ruling, though, there’s been a significant change in the general outlook on sports betting. All the top leagues now have official betting partners, and sports betting has become an unavoidable component of sports media.

NBA arena floors and MLB stadium outfields now have signage for sportsbooks displayed, and billboard ads for bookmakers can be sighted across highways in many of the 21 states where betting markets have been launched. Sportsbook ads are now aired on T.V. as regularly as canned goods commercials, with the only difference being that the latter is legal in every state.

Bookmakers are now displaying versatility as they dabble into sports entertainment and multimedia. Some can boast of having award-winning journalists and celebrity headliners. Of course, they do all that while still providing their primary service of taking bets on games.

On the other end of the bookmaking relationship, sports bettors in the country are doing their best to keep up, placing wagers on everything from Norwegian badminton to table tennis matches on YouTube. The month of March saw over $4 billion placed as bets with U.S. sportsbooks, in what was a record for a single month.

It’s just the start of something sure to grow into the world’s biggest regulated sports betting market. At least, that’s what the NFL believes. Chris Halpin, league chief strategy and growth officer, speaking on the growth of legal sports betting in the country, said, “It’s on the way to becoming a huge revenue stream over the next five to ten years,”

According to data from ad measurement company iSpotTV, sports betting companies were responsible for $10.61 billion T.V. ad impressions between September 1, 2020, and March 31, 2021, a seven-month period that coincided with the return of mainstream sports from COVID imposed shutdown. Speaking to ESPN, Tyler Bobin, a brand analyst for iSpotTV.com, said, “The top sports betting companies are only just below canned goods and soups as far as T.V. ad impressions are concerned.”

Data gotten from Nielsen showed that the online gambling industry, led mainly by sports betting, spent about $154 million on T.V. ads in Q1 of 2021 alone. This massive upsurge in advertising has led to concerns that there could be backlash from lawmakers and regulators. A significant percentage of this concern is aimed at the NFL, that named DraftKings, FanDuel, and Caesars Entertainment as their first official U.S. sports betting partners and are now getting ready to allow sportsbook ads this season.

Halpin said that the league has plans to introduce ‘frequency caps’ and regulate the number of games accessible to sports betting advertising. From all indications, it is a tricky balancing act that must be gotten right, especially considering evidence from other countries where aggressive sports betting advertising during games brought about adverse reactions.

“It’s a major step, and we’re going to put a lot of thought into the ways we go about opening up inventory,” Halpin said. “We’ve got sections of our fan base who are real fans of sports betting, but we’ve also got those who have a slight interest, those who are indifferent, and those who dislike it. We’re looking to utilize some tools that can help us serve the first two groups without disturbing the last group. 

Online ads and T.V. commercials aren’t the only forms of sports betting advertising that Americans interact with. Data gotten from the Out of Home Advertising Association of America showed that sports betting ads on billboards, public transportation, and outdoor furniture have risen by 193% over the last three years. In 2020 alone, more than $11 million was spent on out-of-home sportsbook ads. According to OAAA reports, that number equals roughly half of what was spent on out-of-home political ads in 2020. Once again, a key difference to note is that politics, like canned goods, are legal in every state, whereas sports betting is only allowed in approximately half.

Speaking about the growth of the sports betting market, Scott Harkey, president of O.H. partners, said, “I think there’s the potential for it to become rather noisy and annoying, kind of like political advertising. But, I do not think we’re quite at that point yet,”

Bookmakers transforming into media outlets

Not long ago, media mentions of sports betting used to come with a lot of unease and vagueness. Many Americans were linking to stake billions of dollars, but it was never talked about on-air, as no one wanted to upset the top sports leagues. That’s not the case anymore. Media outlets, such as ESPN, can now consider sports betting a revenue stream. It’s no longer taboo.

One exciting development is seeing sportsbooks turn themselves into media outlets for their games, eliminating the middle man. Bookmakers now release game previews and predictions for matches that they’re also setting odds and taking bets on. It appears to be an evident conflict of interest, but it also seems to be what bettors prefer. 

Hot Paper Lantern, a consulting and marketing firm, has released survey results that show that sports bettors prefer to use their sportsbooks for more reasons than just betting. 69% of bettors said they didn’t mind getting betting tips and previews from the bookmaker they’re gambling with.

DraftKings, one of the biggest sportsbook operators in the U.S., recently purchased Vegas Stats and Information Network (VSIN) in a bid to give bettors what they desire. VSIN is a sports betting platform that has within its ranks renowned broadcaster and betting enthusiast Brent Musburger. DraftKings reportedly paid almost $70 million to purchase VSIN.

Bally also followed suit in transforming itself into a sportsbook and media outlet. Instead of Fox Sports Networks, they have introduced Bally Sports, 19 separate regional networks rebranded to complement Bally Bet, their soon-to-be-released sportsbook app. Other bookmakers are also looking to create content in-house and are enticing famous sports journalists away from the traditional media outlets. 

In October last year, PointsBet brought in veteran sports columnist Teddy Greenstein to spearhead content production. Before he was hired as PointsBet’s senior editor, Greenstein had spent over 20 years at the Chicago Tribune, covering massive football games, the U.S. Opens, and Masters.

Stream Bet

Sports bettors searched for alternative options when mainstream sports leagues were put on hold during the pandemic peak. Video game simulations, virtual racing events, and pop-up tennis tournaments were some of the alternatives that fans began to bet on. Of all the alternative betting options that sprung up during the pandemic, none had as much lasting power as table tennis.

March alone saw an estimated $8.8 million bet on table tennis markets in Colorado, an amount greater than what was bet on golf and MMA combined. Scores of international table tennis games are played every day, with most of them coming after midnight, long after U.S. sports have been played. Some of these tennis matches are streamed live on DraftKings mobile app. 

When Triller first began considering organizing and streaming celebrity boxing matches, Ryan Kavanaugh hadn’t yet thought about sports betting. But, when he realized how much influence fights were garnering with sportsbooks, he had a change of mind. The digital entertainment platform streamed the celebrity match-up between YouTube influencer Jake Paul and UFC fighter Ben Askren, and it turned out to be the most heavily wagered boxing match of 2021 to date. Jake Paul won that match, knocking out Askren in less than two minutes.

Triller entered into a partnership with DraftKings in 2021, and sources close to the deal have said it is worth up to $20 million. Kavanaugh has revealed, though, that Triller will consider introducing its betting platform before the end of the year, such is the attraction of sports betting. Speaking to ESPN on the significant interest in sports betting, Dan Ghosh-Roy, spokesman for the Professional Fighting League, said, “betting is such a major priority for us as a business, especially in the way we plan our events.”

With the way things are going, it wouldn’t be such a surprise if custom-made-for-betting events were to begin to spring up sometime in the future. The Supreme Court ruling from May 14, 2018, has turned out to be a real game-changer, and it is what kick-started the betting surge over the last three years.

Barely one month after the ruling, New Jersey and Delaware launched their sports betting markets. Thirty-six months later, 21 states in the country can boast of having legal sportsbooks operating in them. Texas, California, and Florida are three of the most significant states that have not yet entered the regulated sports betting market, but they’re closely monitoring it.

In 2017, sportsbooks in Nevada were the only legally regulated sports betting options in the country, and they brought in net annual revenue of $248 million. Fast-forward four years, and sports betting had generated revenue of $961.1 million in just the first three months of the year. For context, the total amount generated in the whole of 2019 was $911 million.

You can placed you bets legally in US states where sports betting is legal both online and in person. Check your state and claim a free bonus today.

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