It is the National Sports Betting season, when millions of Americans visit their bookies and place a friendly wager on a favorite team. The American Gaming Association estimates that $30 billion will be wagered on football this year. The betting season begins with the return of football, professional and collegiate. It lasts past the Super Bowl until March Madness is put to bed. The season is a bookie’s dream come true. The amount wagered on sports nationally leaps in September over August. Last year for example, the national handle went from $9 billion to $13 billion and 2026 is expected to exceed 2025, as 2025 exceeded 2024, and 2024 surpassed 2023. The trend goes back to the Supreme Court decision declaring sports betting to be a state’s right issue in 2018.
With the first kickoff, the sports betting operators, particularly DraftKings and FanDuel, also kick off their advertising campaigns. The advertising battles to obtain new customers will be intense and very expensive, so much so that some of the lesser companies are trying to stay out of that media fight as much as possible. It is simply too expensive to justify the return. BetMGM CEO Adam Greenblatt offers some insight into his company’s sports betting.
Greenblatt says that BetMGM is playing a niche game, focusing on elite higher-value players, like the upper-end casinos on the Las Vegas Strip. Rather than focus on expensive television advertising, MGM has focused on better technology and pinpoint advertising and promotions. Probably a good idea, especially this year with the prediction marketeers, Kalshi and Polymarket, joining the fray. The cost of competing is going to go up faster than the handle.
The cost of advertising is not the only one involved, at least for Kalshi and Polymarket. The legal battles over prediction markets have raised their visibility to unprecedented heights; the advertising during the football season will only increase that visibility. And that is not good news. Over the last year, prediction market companies have been in court in dozens of states. Kalshi argues that it is offering a product exactly like a commodities exchange and subject only to federal regulation. The states are arguing that Kalshi offers a sports betting product and is therefore subject to state jurisdiction. For the most part, the legal commercial gaming industry has been on the side of the states.
Here again, Greenblatt had a comment. He said his company was watching the issue closely and was not averse to the idea of using prediction to enter new markets. But MGM is very sensitive to the regulators in states in which it has a license. Greenblatt said MGM would do nothing to jeopardize those licenses. Some gaming companies are going further and lobbying for state legislation to force prediction market companies into complying with state laws, regulations, and taxes.
It makes sense for the gaming industry that everyone play by the same rules. As it stands, the prediction markets are in a special category. They are not paying license fees and taxes or following regulations. So when all the operators line up in front of the television audience during a football game, Kalshi and Polymarket have a decided advantage. They get the same exposure with the potential for a much better profit margin. It makes good business sense, except maybe it does not. The catch is in the exposure.
That is what brought DraftKings and FanDuel in line. The two fantasy sports companies were everywhere on television during football games in 2015, spending $30 million a week; it was their coming-out party. However, after just a few weeks of leading the list of advertisers on football games, DraftKings and FanDuel had outed themselves. AGs from dozens of states saw the ads and thought, fantasy sports is just not legal. And then the AGs set out to stop the two, not from advertising, but from offering an illegal fantasy sports product in their states. By 2018, when the Supreme Court allowed the states to legalize sports betting, DraftKings and FanDuel had reinvented themselves as legitimate sports betting operators. Today, they hold nearly 80 percent of the sports betting market in the country.
Kalshi and Polymarket are in much the same position this year. While they may win the customer-acquisition war for the moment, by creating a high profile, they are risking their business model. Greenblatt had an opinion on that subject too. He said he believed the Supreme Court would rule on the subject before football 2027.
In the meantime, the games will be played on the field and the wagers placed on the cyber field. And the numbers will be huge; one estimate has prediction markets handling $8 billion in trading volume the first weekend. The contests to determine a Super Bowl champion have only just begun and the outcome is, of course, uncertain. The eventual winner of Customer Acquisition Bowl is also in doubt. It may be left to the Supreme Court to make that determination.
