Could the Bally’s-Sinclair deal bring sports betting to California, Texas and Florida?

Could the Bally’s-Sinclair deal bring sports betting to California, Texas and Florida?

  • Howard Stutz, CDC Gaming Reports
November 25, 2020 12:00 AM
  • Howard Stutz, CDC Gaming Reports

Casino operator and budding sports betting provider Bally’s Corp. views its new partnership with media giant Sinclair Broadcast Group as a customer-acquisition vehicle. The Bally’s name will replace Fox on Sinclair’s 21 regional sports networks while wagering information and content will be provided on the group’s 190 television stations in 88 markets – 70% of all U.S. households.

The agreement might be the outside force needed to bring legal sports betting to three important markets still on the sidelines.

California, Texas, and Florida – the three most populous states in the U.S. according to Census Bureau data – are home to 27% of the franchises in the four major professional sports leagues and numerous high-powered college sports programs.

But they don’t offer legal sports betting to their residents.

Meanwhile, Fox Sports West and Fox Sports San Diego (Southern California), Fox Sports Southwest (Texas), and Fox Sports Florida hold the broadcast rights to such teams as the Los Angeles Angels, Los Angeles Kings, San Diego Padres, Dallas Mavericks, Texas Rangers, San Antonio Spurs, Tampa Bay Lightning, Tampa Bay Rays, and Miami Heat, among others.

If the ultimate goal of Bally’s and Sinclair is to offer sports viewers the ability to wager on games with Bally’s directly from their televisions, those three states and millions of fans will be left on the bench.

That notion wasn’t lost on sports betting consultant Sara Slane.

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In the last 30 months, legal sports betting has emerged in 19 states and Washington, D.C. Another six states have approved the activity and are expected to launch next year. Slane said the market will grow “exponentially” and teams whose games air on Sinclair’s regional sports networks will find new opportunities to benefit from the Bally’s connection.

“Sinclair is clearly, and wisely, looking to the future of how fans will engage with games,” Slane said. “Sinclair and Bally’s are making a smart move to tap into this new market, supercharge marketing and advertising efforts, and develop brand loyalty at this relatively early stage of the game.”

Bally’s is paying Sinclair an estimated $85 million – through stock warrants and options – so one might think the company would want to expand its presence.

Adding California, Texas, and Florida to the sports betting universe, however, has been an elusive and herculean task.

But some cracks are showing.

The Texas Tribune reported last week that new “sin taxes” – casinos, marijuana, and sports betting – could be considered by Texas lawmakers next year to help repair the state’s budget holes brought about by the COVID-19 pandemic.

In California, a coalition of Indian tribes qualified a ballot referendum for 2022 that would allow sports betting at the state’s Indian casinos and licensed racetracks. However, the proposal doesn’t include California’s 72 cardroom casinos, would prohibit wagering on games involving California universities and colleges, and has no provision for mobile sports betting. State lawmakers may weigh the matter next year.

In Florida, any deal to legalize sports betting needs to go through the Seminole Indian Tribe, which owns the Hard Rock brand and is the state’s dominant casino operator. Another push could happen during the state’s 60-day legislative session, which begins in March.

So where does the Bally’s-Sinclair deal fit in?

Bally’s spent $125 million to purchase sports betting platform Bet.Works and created a division to oversee its new interactive gaming product. The company’s next move might be adding outside lobbying help in California, Texas, and Florida. Sinclair could also be enlisted.

Bally’s will launch a sports betting app in Colorado, Indiana, Iowa, and New Jersey in the second quarter of 2021, around the same time its partnership with Sinclair is expected to go live.

“While (Bally’s) will clearly not have first-mover advantage in existing states, we do think they could be a formidable player, especially with their omni-channel strategy,” said Truist Securities gaming analyst Barry Jonas.

Sinclair’s ownership stake in Bally’s is expected to be as high as 30% and Jonas said that alone will “incentivize them to see Bally’s succeed.”

A more widespread market beyond Bally’s casino operations of 14 properties in 10 states could include eventually include California, Texas, and Florida.

“Bally’s massive customer database and footprint … will only grow as they become associated with fans’ favorite teams in their respective markets,” Slane said.

Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at Follow @howardstutz on Twitter.