Tag: Sports Betting

DraftKings and Resorts Casino Strike Sports Betting Deal

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Boston-based daily fantasy sports leader DraftKings has recently announced a new partnership deal with Atlantic City’s Resorts Casino Hotel to offer sports betting services in New Jersey. The partnership agreement will see DraftKing enter the New Jersey market under Resorts Casino Hotel’s license.

The move marks the first of the likely string of state-level ventures that DraftKings has is reported to be considering in a bid to get a foothold in the brand new legal market that is set to grow rapidly after the recent Supreme Court ruling that struck down the federal ban on sports betting.

As for New Jersey, the daily fantasy sports operator has hinted its entry into that particular market for quite some time – the company had already begun hiring sportsbook staff even before the United States Supreme Court ruling was made. In addition to that, the company opened an office in Hoboken that currently houses the sportsbook staff as well as other employees who were hired in the past couple of weeks.

“Everybody knows there’s a big opportunity out there. It’s a new thing, so people are trying to see how they want to go about it, who they want to partner with. Anytime you’ve got a big market about to be created, there’s so much opportunity out there that everyone should benefit, as long as you do it the right way,” said Jason Robins, the DraftKings chief executive. “We are excited to work with Resorts Hotel Casino to bring our new DraftKings sportsbook to New Jersey. As a tech savvy and a long-term growth-oriented organization, Resorts Hotel Casino aligns perfectly with our customer-focused, innovation culture.”

This pairing reflects the scramble that is beginning to materialize among gambling operators, bookmakers, and technology companies as they try to position themselves well enough to get a share of the nascent sports betting market. A similar deal was made a few weeks ago when Paddy Power Betfair, a European bookmaker merged with FanDuel, one of the other popular United States-based daily fantasy sports providers and DraftKings’ biggest rival.

During the press release where the announcement was made, Drafkings mentioned that it be offering both mobile and web-based sports betting services. However, there was no mention of the technology that the company will be using to achieve this.

Still, Resorts Casino Hotel has welcomed the partnership as it presents a new revenue stream and will probably give the casino a foothold in the sports betting market as well.

“We are at a pivotal moment in the development of sports betting in the U.S.,” said Morris Bailey, the owner of Resorts Casino Hotel in the press release. “We are delighted to be able to have DraftKings utilize our gaming license in New Jersey. DraftKings continues to be at the forefront of sports entertainment innovation, and today’s announcement is the first step in being able to offer customers in New Jersey the most dynamic sports betting platform.”

Integrity Fee Included in New N.J. Sports Betting Bill

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Just a few days ago, a top lawmaker in New Jersey called for all governors to reject the efforts by pro sports leagues to have an “integrity fee” on sports betting revenue included in the various states’ sports wagering laws. State Senate President Steve Sweeney, the lawmaker who also happens to have championed the state’s efforts to have the federal ban on sports betting overturned, said that the demands by the leagues are tantamount to “extortion.”

“Essentially, the leagues are asking to be paid to allow games to be played fairly,” Sweeney wrote. “Ironically, they are calling this extortion attempt an `integrity fee,’ even while fully aware that providing participants a stake in the volume of betting would amount to what could more accurately be called an ‘anti-integrity fee.’”

Sweeney expressed concern that the leagues had blatantly shifted their focus on getting a piece of the sports betting pie instead of concentrating on the integrity of their games. The lawmaker’s sentiments are quite justifiable especially considering the fact that, prior to realizing the inevitability of the abolishment of the Professional and Amateur Sports Protection Act (PASPA), the leagues had spent millions of dollars fighting against the sports betting laws in New Jersey.

“The Leagues fought with all of their resources to stop states from allowing their citizens to legally wager on sports,” Sweeney wrote in a letter that was addressed to the governors and lawmakers in all 50 states. “Now that their efforts have been ultimately unsuccessful they wish themselves to make ‘the fast buck’ and to ‘get something for nothing.’ Essentially, the Leagues are asking to be paid to allow games to be played fairly…. Taking the Leagues at their word, giving them a ‘piece of the action,’ would make suspicions grow whenever turning-point calls in close games go in favor of the more popular team — whose presence in the ‘big game’ would drive ratings and betting.”

New Jersey, however, chose to take a different approach – the state introduced a new bill with a proposed integrity fee, only that its version of the integrity fee is completely different from the ones in other bills and the one that the professional sports leagues have been lobbying for.

What It Entails

The proposed integrity fee, called the Sports Wagering Integrity Fund, diverges from the other bills mostly because it will be controlled by the state instead of the leagues. The idea is to bypass the pro sports leagues’ push for the 1 percent integrity fee on handles while at the same time offering them an alternative to ensure that do not miss out entirely on the fund’s coffers.

The draft bill states that all the money deposited into the Sports Wagering Integrity Fund will be channeled towards the recovery of any costs and expenses incurred during investigations that will be carried out in order to maintain the integrity of sports betting.

Ireland-based Paddy Power Betfair Acquires FanDuel

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In a move aimed at capitalizing on the United States online sports betting market, Paddy Power Betfair Plc has agreed to merge with closely held New York-based daily fantasy sports site FanDuel. The Dublin-based Paddy Powe Betfair made the announcement that the acquisition had been completed and that the two parties were only waiting for final regulatory approval which – this deal is expected to close by the third quarter of this year.

While both companies were already in talks for a possible merger, the United States Supreme Court ruling that struck down the federal ban on sports betting seems to have escalated the process. As such we might see Paddy Power Betfair participating in U.S. sports betting very soon.

“We are excited to add FanDuel to the Group’s portfolio of leading sports brands,” said Peter Jackson, Paddy Power Betfair chief executive officer. “This combination creates the industry’s largest online business in the US, with a large sports-focused customer base and an extensive nationwide footprint.

The Group has leading sports betting operating capabilities globally and strong operations on the ground in the US. Together with our substantial financial firepower, we believe we are now well placed to target the prospective US sports betting opportunity.”

Paddy Power will own 61 percent of the Paddy Power-FanDuel merger business since it will contribute its U.S. assets and $158 million for the combined business. The agreement further gives the Dublin-based company the option of increasing its ownership to 80 percent after three years and 100 percent after five years.

FanDuel has over 7 million registered users in the United States. This, in addition, the over 40 percent share of the U.S. daily fantasy sports market makes it a great partner for Paddy Power which has been on an expansion course in the United States for the past few years. For instance, Paddy Power merged with Betfair three years ago and acquired Draft last year.

Given the growing demand for sports betting offerings in the United States following the Supreme Court ruling that struck down PASPA, more of this type of mergers and acquisitions are on their way – that is, mergers between parties that already handle legal sports gambling in the U.S. and other parties with big digital footprints in the United Sports market.

While the ruling did not automatically legalize sports betting in all the states, a number of states are moving towards a future where sports betting is legal. This is enough to give the interested parties enough incentives to start preparing.

U.S. Lottery Industry Wants In on Regulated Sports Betting

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A decent number of states have either already legalized sports betting or are on exploring similar legislation that will lead the United States to a new era that will be defined by a regulated multibillion-dollar industry. This presents a plethora of new opportunities that have attracted a number of new interested parties including the gaming operators, the professional sports leagues, and most recently, the lottery industry.

The $80 billion United States lottery industry through the North American Association and Provincial Lotteries (NASPL) said in a statement that the lotteries are prepared to “help establish the real-world network that would be involved if called upon to do so.” The state lotteries have always supported the idea of state governments being given back the ability to decide on gambling laws for their respective states.

Thanks to last week’s Supreme Court ruling that lifted the federal ban on sports betting, all states can now legally draft their own sports betting laws and regulations and this opens up the field for interested parties to begin offering sports betting services.  The NASPL believes that they are well positioned and sufficiently equipped to join and offer sports betting services if given the opportunity to do so, their main advantage being, their strong relationship with pubs, bars, and clubs.

“In addition, some American lotteries already sell their products on the internet, a potential avenue for sports betting if a state allows that option,” the group’s officials said. “The court’s ruling on PASPA will help preserve the founding principles and integrity of American lotteries. The ruling will also potentially provide the freedom necessary to enhance the more than $22 billion that American lotteries returned to their states in FY2017.”

The Next Big Growth Category

Among the aggressive proponents of the Supreme Court ruling and subsequently the involvement of the lottery industry is the founder and chief executive of EquiLottery, Brad Cummings. He believes that industry should take advantage of the opportunity to ensure the legislation is benefits all the relevant gaming verticals. He pointed out that both state and national lotteries should look into creating new categories tailored specifically for sports gambling. This will give them a fighting chance and allow them to compete with all the other gaming entities that stand to benefit from a regulated sports betting market.

“Some states allow at least live horse racing to be a basis for a lottery game, some states prohibit any live sports integration with lottery and most are silent on the issue,” he said. “We advise that regardless of their situation, state lotteries should fight to be included and expand their product offerings into the sports gaming market. While these will be games of chance that don’t directly compete with the skill versions that are sure to be offered by others, the lotteries have some unique advantages that allow them to solve problems that traditional sports gaming cannot; a big one being the licensing fee leagues are demanding for their product to be utilized. Since the margins are much larger on lottery games, especially draw games which I think are the most analogous to a live sports lottery category, the fee won’t be cost prohibitive like it can be if taken out of a vig.”

What Is Next for Pro Leagues After Supreme Court Ruling?

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It has been a week since the United States Supreme Court repealed the Professional and Amateur Sports Protection Act (PASPA) thus effectively giving states the go-ahead to liberate over their own sports regulation and rules. Still, the landmark ruling remains quite a big deal especially because the implications it comes are huge, to say the least. While it will take time for various stakeholders to adjust appropriately to this development, it is impossible to ignore the ongoing discussion pertaining to how a legalized and regulated sports betting system will affect the professional sports leagues’ businesses.

In the recent past, a number of leagues – the most recent being the NFL – through their commissioners or other high ranking officials have expressed concern about the integrity of their games being compromised due to increased legal sports betting. This has been touted by many experts as a misguided opinion. To elaborate this, Nevada is a great example of a legalized sports betting market that has thrived without any evidence of match-fixing.

Getting the Best Out of It

It is estimated that more than $150 million is illegally wagered on sports each year. On a similar note, the Nevada Gaming Control Board also recently revealed that over $4.8 billion had been wagered on sports in Nevada Sports Books. As such, the Supreme Court ruling will actually be beneficial to the professional sports leagues by taking the billions that are illegally wagered in sports and subjecting it to state regulation and the league’s oversight.

Acknowledging the fact that sports betting has always been with us is the first step towards making it work for everyone involved. By bringing it to the open, the ruling will make it easier for the leagues to monitor the games that are most likely to be fixed and the players they need to keep an eye on. This kind of oversight would be impossible in an illegal sports betting market.

Also, the ruling came at a time when most state legislatures in the United States are already in recess. This means that the professional sports leagues have plenty of time to ideally and strategically position themselves to collaborate with individual state legislation when the 2018-2019 legislative period begins. This way, they will be able to effectively assist in tailoring new sports betting laws in order to ensure that their interests are also considered as the United States enters a new era of legalized sports betting.

The relationship between professional sports and gambling has never been as mainstream as it is now. While the leagues have not been particularly welcoming to the idea of embracing sports betting, the professional sports teams have on the other hand participated in one way or the other albeit indirectly. For instance, a number of teams have willingly invested in Daily Fantasy Sports and accepted money for the use of their logo in state lotteries and in-stadium casino signage. Clearly, there is a bright future ahead for all the stakeholders, they just need to know when and how to capitalize on this new opportunity.

New York Lawmaker Wants Online Poker Bill Passed In June

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After the United States Supreme Court repealed PASPA last Monday and paved the way for the legalization of sports betting in various states, a related concern has arisen and it is now being heavily debated – that is, the future of other skill-heavy forms of gambling such as online poker. While there is no direct correlation between the Supreme Court ruling that struck down PASPA and the legalization of online poker, it is believed that states that push forward with sports betting legislation will eventually lean more towards an all-inclusive gambling legislation rather than sticking to individual types of gambling.

In New York, the push for the legalization of sports betting surges with most recent development being the renewal of calls for the same by New York Assemblyman Gary Pretlow. The lawmaker hopes to have the online poker bill passed by next month. In fact, Pretlow believes that putting the bill on the Assembly floor is the only thing that stands in the way of its passage.

“To get it to the floor is all that’s needed. He [Heastie] is not going to guarantee passage, but get it to the floor and I’ll debate it and get it passed,” Pretlow said.

It will not stop there though. The assemblyman further confirmed that his long-awaited sports bettings bill will follow through next week and despite his current efforts to have online poker legalized he will not be including online poker in the legislation. According to him, every bill he introduces “should stand on its own merit.” As he sees it, such a move would be perceived as a plan to sneak in something else that some people may be opposed to. He, however, agrees that the expectation that a sports betting bill could be passed next month improves the chances for online poker.

“This will be helpful to getting online poker done,” Pretlow commented the sports betting bill. “There are more people interested in pursuing sports betting than pursuing online poker. For whatever reason, people consider online poker to be gambling but don’t consider sports betting to be gambling. I’m going to show them this is all gaming, and all forms of gaming happening are related.”

US Supreme Court Ruling Paves Way for Legal Esports Betting

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On Monday, the United States Supreme court repealed a law that prohibited sports betting with a 6-3 ruling that has finally brought to an end the six-year legal battle over the Professional and Amateur Sports Protection Act (PASPA) of 1992. The ruling effectively opened the doors for legal sports betting in any state that wishes to offer it. However, it does not stop there – the ruling is also now poised to have some major implication for the Esports industry.

While the ruling did not mention Esports specifically, but considering the recent commingling and partnerships of traditional sports and Esports, it is undeniable that the correlation will result in the legalization of Esports betting as well.

“The Supreme Court just struck down the primary law restricting sports betting throughout the US. This will have a profound impact on the Esports industry and we’re so underprepared for it. ~$5B wagered on Esports last year – about to skyrocket,” Bryce Blum, an attorney, and ESG Law founder tweeted.

Clearly, Esports betting is already tremendously lucrative even though the majority of the bets are done illegally. However, the U.S. Supreme Court ruling is expected to give it some legitimacy. Dallas Mavericks owner Mark Cuban believes that the ruling will double the value of Esports franchises overnight the same way it did for the traditional professional sports franchises.

“It doubled the value of the professional sports franchises in a second,” Cuban said. “It will increase interest, it will add to what happens in our arena and in stadiums. It will increase the viewership for our biggest customers online and on TV. It helps traditional television because it’s much lower latency, whereas online, because of cachet, it’s much higher latency.”

At this point, the inevitability of Esports cannot be denied and this puts the industry at a crossroads of some sort: are we going to embrace it or shun it altogether. We can all agree that gambling has its problems for sure but, as it turns, the negative externalities (such as illegal betting) are usually magnified due to the lack of participation of league operators. No one wants that.

“Some of the technologically advanced states will move relatively quickly, but my hope is that there’s a federal approach to it, as opposed to everyone having to deal with each state individually,” Cuban added. “If that’s difficult in the short term, I think it’d be really smart for the commissions from as many states as possible to work together to standardize things because that will enable the most creativity. When each state has its own rules and requirements that jacks up the expense for everybody, which minimizes the entrepreneurial and technology opportunities.”

Landmark US Supreme Court Ruling Lifts Sports Betting Ban

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On Monday 14, the United States Supreme Court finally delivered a much-anticipated ruling that sports fans and bettors have been eagerly waiting for. The court’s decision effectively overturned the Professional and Amateur Sports Protection Act (PASPA) of 1992 that imposed a federal ban on sports betting in all but a single state – that is, Nevada. The ruling was made in favor of New Jersey which has fought for years to have sports betting at casinos and racetracks legalized.

“The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each state is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the constitution. PASPA is not,” Justice Samuel Alito wrote.

According to the American Gaming Association, Americans illegally wager approximately $150 billion on sporting events every year which is clear indication that even prior to the debate on the legalization of sports betting, the federal ban had already failed miserably. Generally speaking, the existing underground market offers zero protection for gambling addiction or problem gambling and no safeguards for game integrity. These are some of the issues that a legalized and regulated sports betting market could solve.

The Supreme Court decision will take sports betting out of the shadows and thus make it open and transparent. This way, regulators, law enforcement agencies, and sports leagues will have tools and more support in their endeavors to shut down illegal or underground gambling operations. In addition to this, technology experts and data analysts will also be able to easily identify suspicious betting patterns in real time which will, in turn, culminate in better protection for game integrity.

Now that the decision potentially implies the creation of an entirely new revenue stream, there are certainly going to be a lot of interested parties. Professional sports leagues have already made their demands for an integrity fee clear and the government through the Internal Revenue Service is eyeing a piece of the winnings.

“The amount of gambling winnings, less any losses, gets tacked on to all other income you have … and is taxed as ordinary income,” said Bill Smith, managing director at Washington’s CBIZ MHM’s National Tax Office.

A lot depends on the number of states that decide to permit sports betting. Hopefully, the possible legalization of sports betting in some states, such as Pennsylvania, will also have a positive impact on efforts for online poker expansion. Still, it is still too early to tell how impactful the landmark ruling will be since we have to wait and see how the states will handle it.

Hawthorn President Warns of Sports Betting ‘Indoctrination’

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Sports betting is still on the verge of becoming a reality in the United States and while there are people who have always supported it and others who have acknowledged its inevitability and began preparing, there are some who still find the idea of it to be distasteful. This extends to other countries as well, not just the U.S. One such person is Hawthorn president Jeff Kennett who during this week’s promotion of this year’s beyondblue Cup has made public some of his long-term concerns about the impacts of sports betting advertisement on the society.

Like many other Australian Football League clubs, Hawthorn contentiously relies on revenue from poker machines but Mr. Kennett believes that there is a significant distinction between the poker and sports betting. According to him, poker machines are strictly for adults and children are not allowed to play.

“The worry I have with sports betting is that it is indoctrinating a whole generation of young people that their future, their happiness, is associated with gambling,” Kennett said of sports betting. “When we have sports betting up there being thrust down the throats of young people on a daily basis – whether it be on television, on radio etcetera – you are indoctrinating them into a lifestyle aspiration, which I think is very dangerous.”

Last year, the Australian federal government introduced a legislation that set limits to when sports betting advertisements can be shown. Kennett, on the other hand, believes that this is not enough and the government should implement a blanket ban or at least subject them to the same restrictions that casinos are subject to as far as advertising is concerned.

“If I was in control, I would apply the same rules to promotion and advertising of sports betting that applies to casinos and gaming machines, and that is that you can’t advertise it publicly,” he added.

Kennett also believes that the effects will not be seen for the next 10 to 15 years but it will too late by then and there is a high likelihood that other problems will have spawned from it as well.

Premier League Supports US Sports Betting Expansion

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The English Premier League recently voiced its support for the vision that the NBA, MLB, and PGA Tour have had for the expansion of sports betting in the United States in the likely case that the country’s Supreme Court abolishes the Profession and Amateur Sports Protection Act (PASPA) which prohibits all but four states from legalizing sports betting. The United States Supreme Court is expected to deliver the much-anticipated ruling by the end of June but already various stakeholders are preparing for a future where sports betting is legal.

The National Basketball Association, the Major League Baseball (MLB) and the PGA Tour have all backed the idea of legalized sports betting – the NBA and MLB have even outlined some of the potential laws and terms they expect to be implemented should sports betting be legalized. Some of these potential laws will require sports betting firms to use official league data, share customer data and pay an “integrity fee” as well as allow the leagues to have an input on the wagering options the sportsbooks can offer.

The English Premier League (EPL) through Adrian Ford, Football DataCo general manager has made it public that it would support the approach by the NBA and MLB – Football DataCo is the official rights-holder for the Premier and League as well as all the other professional football leagues in England.

“Broadly, we don’t think what the leagues are asking for is fundamentally wrong, if you’re trying to come up with a framework that works for both parties,” Adrian Ford said in an interview with ESPN.

“We would not see why there would be an issue about sports getting a return from betting. We’d echo some of the high-level statements the NBA has made. If someone is making money off us, there’s no reason why we shouldn’t be interested in that and why we shouldn’t have some level of involvement in the commercial return. It’s clearly not what we have here.”

Why Is the EPL Interested?

It is no secret that betting has been a key component of the English Premier League’s operation. As such, it would not come as a surprise when it joins the parade of United States professional sports leagues that are currently seeking a revenue cut from sports betting operators

“When it comes to customers and integrity and really trying to provide the best experience, official data, backed by the leagues, is fact; you need a gold standard,” Ford added. “Ultimately, the common goal – and it is easier said than done – must be to have a functioning, regulated, safe betting market that brings all the offshore money onshore for the good of the sport, for the protection of the players and presumably for the good of the states that are going to get tax revenues.”

The involvement of the EPL sets a precedent for the leagues being granted control over data rights in the United States which will be a win for all of them.