Anyone who lives in New York, where sports betting is now officially legal, can tell you that they are now being absolutely bombarded by sports gambling commercials and outrageous free money offers to get fans started on sports gambling apps like DraftKings or FanDuel. The big brand casinos, including Caesars and MGM, have also gotten into the act.
The sports gambling wars taking place right now are, in a word, insane:
You’ve got all these players who all have the same product, suddenly competing for millions of new customers and throwing money like nothing I’ve ever seen.
— Chris Hayes (@chrislhayes) January 19, 2022
All of these gambling industry players are giving away “free” cash to attract and lock in (they hope for life) new customers on their sports gambling Apps.
A healthy chunk of new users are among the sport-addicted segment of the younger generation who are making the easy leap from playing fantasy sports on the ESPN or Yahoo! App to Daily Fantasy Sports (DFS) or sports gambling. They’re watching or following all of the games anyway. And they’re rooting for specific outcomes and players so they can win their fantasy matchups. What’s so different about gambling, then fantasy games?
My evidence is anecdotal, but I believe that this generation (and probably others) often play “fun” but hard-to-win multi-leg parlays that many of the gambling apps have pre-constructed and push out and feature to its users. It’s a bit nefarious. Trust me when I tell you from personal experience that the last thing a father wants to hear when talking to his college age son is that he bet a seven (!) leg parlay “but don’t worry, I’m confident it’s going to hit; I picked all the favorites.”
We are living in a very different landscape in terms of sports gambling than we were even just a short time ago. The rapid shift is due to a number of factors, including changes in the law, changes in technology, changes in the attitude of the major sports leagues about the topic, caused by, how to put this…, a rebalancing of values between greed and fear for the integrity of the game, and a resulting shift in the attitudes of the league’s major media partners, including sports radio and television.
Crypto and sports gambling companies are investing *insane* amount of money right now.
The answer: A metric ton of SuperBowl commercials will be for these “services”. https://t.co/2flaYdry5d
— Michael Kasdan (@michaelkasdan) February 13, 2022
ESPN now has several shows and a number of segments dedicated to sports gambling. So do my local sports channels, like MSG and SNY. And it feels like at least 50% of the ads I see when watching television these days are for sports gambling apps.
Raise your hand and retweet this article, if, like me, you feel like you have seen this particular Caesar’s Sportsbook ad with J.B. Smoove (Photo Credit: Caesar’s Sportsbook) more than, say, 500 times.
(How many of you also raised your hand and retweeted just now!?)
#SuperBowlCommercials @motherhoodmag:
“Oh my God. That’s Halle Berry as Cleopatra in that sports betting commercial!”
me:
“So what?”@motherhoodmag:
“Ugh. They put her in a dumb sports betting commercial. With JB Smooth!”
me:
“Excuse me. It’s Smoove.”
— Michael Kasdan (@michaelkasdan) February 14, 2022
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How exactly did we get here?
Trust me when I tell you from personal experience that the last thing a father wants to hear when talking to his college age son is that he bet a seven (!) leg parlay “but don’t worry, I’m confident it’s going to hit; I picked all the favorites.”
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Just over a hundred years ago, the Chicago White Sox, believed by many to be one of the greatest baseball teams ever assembled, lost the World Series to the Cincinnati Reds. Fans would later find out that the “Black Sox” had thrown the series, losing on purpose as part of an arrangement with a nationwide gambling syndicate.
Although in the subsequent trial the jury would acquit the eight White Sox players, including star pitcher Eddie Cicotte and renowned outfielder “Shoeless” Joe Jackson, of criminal conspiracy charges, the Chicago Eight were expelled from baseball by newly installed Commissioner Kennesaw “Mountain” Landis in an attempt to assure the American public of the integrity of the game of baseball.
Since that time, sports betting has been considered to be a cardinal sin in baseball.
Just ask Pete Rose. (By the way, in a true sign of the times, if you’re wondering what the banned-from-MLB-baseball-for-gambling-on-baseball Pete Rose is doing these days, he is starting a sports gambling podcast. Seriously).
It’s plain to see that what is driving the league’s evolving stance on sports gambling may be summarized as “we are talking about a shit-ton of money here and we would like some.”
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It’s not just baseball, of course. In men’s college basketball, there was the Boston College basketball point shaving scandal, back in 1978. At the NBA level, there was the 2007 FBI investigation into referee, Tim Donaghy, who resigned from the league after pleading guilty to two Federal criminal charges arising from allegations that he bet on games that he officiated during his last two seasons and that he made calls that affected the point spread in those games.
In the NFL, there is a famous story about Jet’s then-QB, ‘Broadway’ Joe Namath, who, after Super Bowl III, opened a nightclub called Bachelor III. According to Namath’s biography, the Bachelor III was frequented by “con men, fences, bookmakers, and of course made men – exactly the kind of guys you’d expect to find in a hot East Side joint.” At the time, NFL Commissioner, Pete Rozelle, told Namath to sell his interest in the club, because of the associated reputational harm to the league. Namath initially threatened retirement instead of selling, but he eventually agreed. Many years later, former NFL Commissioner Paul Tagliabue, testifying before Congress about the National Football League’s interest in curbing sports betting, explained the league’s interest this way:
“Sports gambling threatens the character of team sports. Our games embody our very finest traditions and values. They stand for clean, healthy competition. They stand for teamwork. And they stand for success through preparation and honest effort. With legalized sports gambling, our games instead will come to represent the fast buck, the quick fix, the desire to get something for nothing. The spread of legalized sports gambling would change forever—and for the worse—what our games stand for and the way they are perceived.”
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In recent years, however, the tide, however, has turned dramatically.
Part of this is due to changes in the law relating to gambling (after massive lobbying and legal efforts by those who wanted legalization outside of Casino sports books that were physically located in Las Vegas, Atlantic City, or on Native American reservations, including many states seeking revenue sources).
In 2018, the U.S. Supreme Court struck down the federal ban on single-game wagering on Constitutional grounds, leaving it is up to state legislatures to address the issue in each state. Today about eighty percent of the states in the country have legalized sports wagering or introduced legislation to do so. Many states are approving mobile sportsbook apps, while others are choosing the more limited route of in-person wagering at sportsbooks. Interestingly, in the aftermath of the COVID-19 pandemic, even more states chose to examine legalizing sports betting, seeking ways to increase revenues to offset budget losses.
Back in 2017, reading the legalization tea leaves, the Commissioner of MLB, Rob Manfred, went on record stating that “We are reexamining our stance on gambling…[and that it] can be a form of fan engagement, it can fuel the popularity of the sport. We all understand that.” Last year, Manfred tipped his hand a bit more, making it clear MLB has gone from “reexamining” to definitely headed that way. He touted the slow pace of play of baseball as “perfect for sports betting” and gambling as an important part of the game’s future: “We do see it as an opportunity in everything we do – our broadcast, all forms of fan engagement. It is better for our fans and those interested in it fill in the gaps for the game an another opportunity for entertainment that our fans clearly want.”
“The spread of legalized sports gambling would change forever—and for the worse—what our games stand for and the way they are perceived.” – Former NFL Commissioner, Paul Tagliabue
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The NBA has moved in the same direction, and in fact led the charge. In a 2014 New York Times editorial, NBA Commissioner, Adam Silver, pointed out that despite legal restrictions, sports betting was widespread, but underground and therefore unregulated. He also acknowledged that most Americans approve of sports betting. Silver wrote “[T]he laws on sports betting should be changed. Congress should adopt a federal framework that allows states to authorize betting on professional sports, subject to strict regulatory requirements and technological safeguards.” He has more recently explained his rationale for pushing into sports gambling, stating that “we should be participating in it for two reasons: one is to protect the integrity of our game, that if we can’t follow the betting action, we don’t know if there’s aberrant behavior, we therefore can’t investigate the incident…And then number two, it is our intellectual property. We spend billions of dollars a year creating this product. It is my feeling that if people are going to be using the data around our games to bet, we should be participating in that.”
We are reexamining our stance on gambling…[and that it] can be a form of fan engagement, it can fuel the popularity of the sport. We all understand that.” – Current MLB Commissioner, Rob Manfred
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Now, Adam Silver is a very shrewd guy.
While it is an interesting turn of logic – and a 180 degree different stance from MLB’s after the Black Sox Scandal or the NFL’s after the Joe Namath night-club incident, to argue that a big reason for getting sports leagues involved in gambling is to protect the sports’ integrity, its plain to see that his reason number two, which may be summarized as “we are talking about a shit-ton of money here and we would like some,” is what is driving the league’s evolving stance on sports gambling.
Reports have consistently mentioned that the NBA is seeking a payment of one percent of every bet made on NBA games, if gambling were to be legalized.
That is a seriously large and new revenue stream, with the sports gambling market of Nevada alone in the area of $5 billion per year.
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To be fair, it’s also a revenue stream that would not exist without the major sports leagues, who pay for, organize, and put on the contests that the gambling industry is based upon. It’s not all that unexpected or unfair of them to seek to capture some piece of that action.
In addition, as the argument goes, it is widely accepted that people were illegally wagering on sports in every state, many through unlicensed offshore sportsbooks. Capturing that revenue through a regulated legal channel allows companies and law-makers better identify and address any issues.
Imagine if the Houston Astros electronic sign-stealing-garbage-can-banging scandal came at a time when MLB was earning a percentage of the gambling revenues from wagers on the Astros vs. Yankees ALCS.
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On the flip side, there is substantial risk to the integrity of all of these major sports in forming close relationships with gambling outfits. The same issues that fueled MLB’s post-Chicago Black Sox Scandal actions and that solidified the taboo of gambling into the DNA of the sport, still exist today.
Imagine the fallout from the next point-shaving scandal or game-throwing scandal if it were to come at a future time when the sports leagues and sports media and gambling companies are so tightly coupled together. It would be – and this is hard to even imagine – massively greater than the negative impact to the sport caused by the Black Sox Scandal.
Or imagine if the Houston Astros electronic sign-stealing-garbage-can-banging scandal came at a time when MLB was earning a percentage of the gambling revenues from wagers on the Astros vs. Yankees ALCS. That potential liability would have intensified the spotlight on MLB’s handling of and decisions with respect to the investigation into that matter. Would the Astros players, who were given no punishments by Commissioner Rob Manfred, be personally liable for gambling losses due to their cheating?
One can imagine many more extremely messy scenarios. With the dollars at stake, the more cynical among us can also imagine the possibility of the leagues and their owners becoming more focused on the effectiveness and efficiency of the sport of gambling than the sports of baseball, basketball, or football.
As between gambling and the NFL, which is the tail and which is the dog?
— Michael Kasdan (@michaelkasdan) January 16, 2022
Despite all this, the sports leagues are clearly signaling that the dollar values of the potential revenue streams to them are so large that they are willing to risk the messy issues of trust and integrity (and the potential legal liabilities) that could arise in connection with any future scandals.
That decision is a massive gamble. Surely, it’s one with a lot of upside. But a massive gamble nonetheless.
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For more on this topic, see: Always Bet On . . . Silver?: Michael Stilley takes a look at Commissioner Silver’s proposal to legalize sports gambling.
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This post is republished on Medium.
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Photo Credit: ShutterStock