On fall Sunday mornings, former New Jersey Gov. Chris Christie comes face-to-face with the results of his state’s successful six-year legal battle to end the national ban on sports betting.
After appearing in his regular segments on ABC’s This Week with George Stephanopoulos, Christie is often followed on his drive home from New York City to New Jersey by members of the show’s crew. Once they’re across the Hudson River, the cameramen and technicians tend to pull over at rest stops or restaurants – or head over to the Meadowlands Sports Complex and place wagers on National Football League games.
Mobile sports betting is not yet legal in New York, and the state’s closest sportsbooks are more than an hour’s drive from Manhattan, but New Jersey’s legal mobile sports betting market is just a few minutes away by car or train. As a result, riverside New Jersey communities like Weehawken, Fort Lee, and Jersey City now see an influx of New York residents on football Sundays.
Former New Jersey Gov. Chris Christie addresses the AGA Sports Betting Executive Summit in March 2019
Christie knew that Americans’ appetite for sports betting was real.
It’s the reason he embarked on the lengthy and costly legal effort to overturn PASPA, a decision geared to shift gamblers away from offshore illegal markets to casinos in Atlantic City and, ultimately, satellite sportsbooks at Northern New Jersey racetracks.
“You just had to look at the illegal market’s explosion online,” Christie recalled in an interview last week. “People love to watch and bet on sports. I felt the demand in my own state. It wasn’t going to stop.”
The ex-governor isn’t surprised that sports betting has been legalized in more than half of the 50 states less than three years after New Jersey prevailed in the U.S. Supreme Court.
“I travel around the country, and I see people enjoying the ability to do this,” Christie said. “If it weren’t for our administration’s efforts pushing through all the court battles and all the defeats until we reached the Supreme Court, none of this would have happened.”
‘Sports betting was wildly popular’
Friday marks the third anniversary of the May 14 ruling that struck down the Professional and Amateur Sports Protection Act, giving the green light for states to legalize sports betting.
What followed has been a 36-month blitz in which half of the U.S. states, along with Washington D.C., have legalized sports betting.
Another six states are expected to launch sports betting operations sometime this year, and the American Gaming Association has said that at least 14 additional states have active legislation or ballot referendum efforts underway that could come to fruition by the end of 2021.
“Maybe I’m a little surprised, but not all that much,” former William Hill US CEO Joe Asher, who was one of the central figures in the legalization and expansion efforts, said of the rapid growth across the U.S.
A DraftKings Sportsbook at The Brook in Seabrook, New Hampshire
“We’ve always known that sports betting was wildly popular all across the country. It was just relegated to the black market outside Nevada. Now that people see it happening legally in other states, they want it in their own state.”
The legalization of sports betting changed Sara Slane’s career trajectory. She began working on the issue for the American Gaming Association three years before the Supreme Court ruling, specializing in communications and research surrounding any prospective legalization.
She spent a year driving consensus among the industry, eventually educating sports teams, sports leagues, and media companies about why sports betting should be legalized.
“By any measure, the acceptance among the states for legalization has been simply remarkable,” said Slane, who left the AGA in 2019 to form her own sports betting consulting business.
“Gaming legislation was always a slow roll. I’m shocked how quickly sports betting has rolled out,” Slane said. “It helped to have the constituencies lined up. Americans have bet on sports as long as there have been sports to bet on.”
AGA CEO Bill Miller at the Global Gaming Expo in 2019/CDC Gaming
$21.5 billion in legal wagers
According to statistics compiled by SportsBettingDime.com, 20 states took in more than $21.5 billion in legal sports wagers during 2020 – a year when the schedules for professional sports leagues and the NCAA were disrupted by shutdowns due to COVID-19. March Madness, the men’s NCAA college basketball championship tournament, was canceled outright.
Still, that figure was roughly a 40% increase over the reported $13 billion in sports wagers placed in 14 states in 2019. Gaming analysts have predicted the U.S. sports betting market could be taking in as much as $30 billion in annual wagers within the next five years. In the recent 16-day March Madness tournament alone, PlayUSA said $1.6 billion was bet legally on the games.
AGA CEO Bill Miller, who joined the Washington, D.C.-based trade organization in January 2019, believes expanded access to legal sports betting has been successful at moving Americans away from unregulated, illegal wagering sites to legal, regulated outlets.
But it’s been a slow process.
Currently, more than 100 million American adults have the ability to wager on sports legally. But changing the habits of sports gamblers, Miller said, is an ongoing task.
“We’re continuing to set monthly record handles, which suggests that people, once they are made aware of legal markets, are more supportive of them,” Miller said. “Politicians moved forward quickly, recognizing that millions of their constituents bet on the Super Bowl and March Madness. It is smart of them to give their constituents something that is safer and protects the consumer. At the same time, it raises revenues for their states.”
The Barstool branded sportsbook at the Ameristar Black Hawk in Colorado/Photo via Barstool Sportsbook Twitter
For DraftKings CEO Jason Robins, the effort focused initially on converting his millions of daily fantasy sports users into sports bettors. It wasn’t difficult. DraftKings is currently live with online sports betting in 12 states that, collectively, represent 25% of the U.S. population.
“We had a large database going in, and a brand that is trusted,” Robins says.
He views the expansion of sports betting as similar to initial efforts on daily fantasy sports in 2014 and 2015, when “every week, it seemed like a new company jumped in.”
Robins said it’s clear that in three years, a handful of operators are consistently in the top of each state in terms of market share. At some point, consolidation will inevitably take over.
“I don’t know what the end structure will look like,” Robins said. “Right now, we know this is a huge opportunity.”
‘No state would surprise me’
The initial legal sports betting efforts were concentrated in states with active casino markets, like New Jersey, Pennsylvania, and Mississippi. Regulations and tax structures differed, but in those states, mobile and online sports wagering quickly grew into a significant factor.
Tennessee is currently the only state without a commercial casino market that offers mobile-only sports betting. The activity is managed there through the state lottery.
New York allows retail sports betting at upstate and tribal casinos and has enacted legislation for mobile wagering that would be operated by its lottery. The move has been much maligned by the gaming community, which has complained that the state is not offering sufficient choice to the consumer.
Christie said New Jersey “should be the sports betting model” for states considering legalization. He said several states, such as Illinois and Pennsylvania, “mashed up” the process initially.
“We protected our brick-and-mortar casino business and we made it easy for people to have access across the state,” Christie said. “We knew partnerships were important.”
Christie also put some of his own skin in the game. He utilizes mobile apps from three different operators but declined to name them, saying “no free advertising here.”
His biggest disappointment, however, was that Delaware was ultimately the first state to launch legal sports betting, a week ahead of New Jersey. The state, one of four grandfathered in under PASPA, offered football parlay cards through its racetracks.
“That never would have happened if I were there,” said Christie, who was no longer governor when the Supreme Court ruled.
In 2018, most analysts said the three largest states in terms of population – California, Florida, and Texas – would be hard-pressed to legalize sports betting due to various internal and external conflicts. Efforts are now underway in all three states to legalize the activity, either through legislation or ballot referendum.
“Literally no state would surprise me, because sports betting is inherently popular with the American public,” Asher said. “Now that the sports leagues and teams have embraced it, every state eventually will be in play.”
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
