Opinion

Sports Betting, One Year in

It’s been a year since the Supreme Court overturned the federal sports betting ban, and millions of fans across America now eagerly (and legally) wager on the games they love. As states debate whether to legalize betting, it’s prime time to see where we stand and where we go from here.

So far, 14 states and the District of Columbia have authorized legal sports betting, and another 16 are considering bills to legalize sports betting, including one law awaiting only the governor’s signature.

Since the court’s ruling, fans have legally wagered nearly $8 billion on sports, including $3 billion bet in states that approved betting after the decision.

These early figures suggest that enthusiasm for sports betting runs broad and deep. We estimate nearly 100 million American adults are either current or potential sports bettors, which puts pressure on states to decide where they stand.

As legislatures debate the issue, some lawmakers want to wait and see if tax revenues roll in for states allowing wagering. But sports betting was never intended as a panacea for tight state budgets.

Instead, the rationale for bringing betting out of the shadows and into the open was threefold.

First, regulated sports betting helps drive out illegal gambling and the criminal activity it finances. That’s why sheriffs, cops, police chiefs, former state attorneys general and other law enforcement officials joined the gaming industry to push for overturning the federal ban.

Second, regulated betting can protect consumers. In the illegal market, no one looks out for customers and criminals prey on problem gamblers. In a regulated environment, fans know the market is fair, while people who cannot bet responsibly can be identified and get the help they need.

Third, bringing betting into the open can help protect the integrity of sports contests. Does anyone really believe games are better protected when betting takes place underground, with no regulation, no supervision and no tools for law enforcement to detect suspicious betting?

Sports leagues are getting engaged because they understand betting creates not just a new way to watch sports, but a whole new social experience that deepens fan engagement and draws millions of new spectators. Leagues, teams, owners and gaming operators have joined together to share data, coordinate marketing and design an experience that fans will love.

We’ve also adopted a code of conduct for responsible advertising that builds in part on the lessons learned from Daily Fantasy Sports, where oversaturation of advertising a few years ago turned off fans and drew legitimate complaints from policymakers. Our new Responsible Marketing Code for Sports Wagering restricts advertising and wagering messages to media outlets and products that target adult audiences, prohibits cartoons or music that appeals to minors, and promotes responsible wagering.

As far as tax revenues go, the first state to legalize sports betting, New Jersey, has collected more than $19 million. That’s not a cash cow, but it’s not chump change either. Based on the average annual salary calculated by ZipRecruiter, it’s enough to hire 400 more police officers.

New Jersey’s success isn’t due to being an early adopter, but to the regulatory model it enacted. The state established a rational tax rate, made betting a seamless experience by enabling statewide mobile wagering and took a progressive stance allowing the full range of bets sports fans want.

States have one shot to get this right. By creating a regulated sports betting market, states can help curb illegal gambling and give fans an exciting new way to engage with sports. And maybe even raise a little tax revenue along the way.

 

Bill Miller is president and CEO of the American Gaming Association.

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