As states and sports bettors wait for the U.S. Supreme Court to decide the future of sports wagering across the country, a panel of experts told operators and gaming regulators that it won’t be the financial windfall some operators and states are expecting.
In a panel discussion at G2E on how iGaming fits into the efforts to legalize sports betting in the U.S., Art Manteris, vice president of race and sports operations of Station Casinos in Las Vegas, said people need to realize “it’s a tough business” and sports betting makes up 1 to 1.5 percent of overall casino revenue on the Strip. Sports betting has served as a lure for customers to come to properties to partake in other forms of gambling and spend money in other ways, he said.
“I think (asking) how any expansion is going to take place is getting ahead of ourselves,” Manteris said. “The pace of discussion is moving too fast.”
The prospect of nationwide sports gambling has gained traction after the Supreme Court decided to weigh in on a New Jersey challenge related to PASPA, the 1992 law referred to as the Professional and Amateur Sports Protection Act. Oral arguments are expected to be heard later this year at the earliest, and a decision could be rendered by June at the latest.
The federal law prevents state governments from legalizing sports gambling with the exception of four states — Nevada, Delaware, Oregon and Montana. Only Nevada is allowed to offer traditional single-game wagers, while the others are limited to parlays with multiple team wagers.
A number of states have passed resolutions or legislation calling for the right to develop sports betting, and NBA Commissioner Adam Silver has urged Congress to adopt a federal framework allowing states to authorize betting on professional sports. The American Gaming Association has backed the legalization of sports betting.
“Other states are chomping at the bit and rightfully so, but I don’t think the message of the risk and lack of extreme profitability or division of revenue is being conveyed properly,” Manteris said. “Nevada sports books are a low-margin business. We’re not talking about a mass influx of new revenue when they go into the sports book business.”
David Purdum, a gambling writer at ESPN, said, however, that Nevada has had six straight years of record sports betting and that there was a correlation between mobile app betting and that gain.
Manteris said sports leagues are “seem to be coming around” to the concept of sports betting, despite their long-standing opposition and even litigation against New Jersey’s bid to gain sports betting.
The panelists and audience were optimistic that the Supreme Court will decide in favor of New Jersey, and that federal restrictions on sports gambling in the state are unconstitutional. Some panelists said they aren’t expecting a rush in which many states legalize sports betting at once.
Kip Levin, CEO of Betfair and TVG, said a Supreme Court decision legalizing sports betting across the country won’t be meaningful unless states create an iGaming component. Many states are talking about allowing bets to be placed in a retail setting, rather than online.
“The retail solution alone is not going to solve the biggest problem that a good portion of the illegal market is online,” Levin said. “If you don’t allow online, you haven’t solve the problem that exists today.”
Even in Nevada where people have to go to a sportsbook to sign up for mobile sports betting, that’s not as competitive as illegal options, Levin said.
“There’s not enough revenue to make a meaningful amount of tax dollars unless you include online,” Levin said. “It doesn’t solve the problem and realize the opportunity.”
