The NHL’s 180° on the virtues of sports betting is causing whiplash among people who for two decades saw NHL commissioner Gary Bettman shout about the dangers of legal sports betting and its potential to ruin sports.
Following a flurry of recent NHL announcements including deals with MGM Resorts International to become an official sports betting partner, and a partnership with FanDuel to become the “exclusive official daily fantasy partner and an official sports betting partner of the NHL” — Los Angeles Kings president Luc Robitaille on Wednesday said that gambling revenue derived from such deals and other channels could actually lower ticket prices or at least prevent them from rising at the same rate.
Robitaille made the remarks during an appearance on ESPN’s On Ice podcast with Greg Wyshanski and Emily Kaplan on Wednesday, saying in part: “I’m not going to guarantee it’s going to bring down ticket prices, but it might hold the raise a little bit. If a team plans on raising ticket prices by 8 percent, they might only raise them by 5 or 4 percent. If there’s a lot more money at the table, it makes everybody’s life easier.”
We’ll put the likelihood of a reduction of prices and/or slowing of their incremental increases at 25-1. Let’s now explore the reason for that line a bit deeper.
It’s official — Mississippi loves it some football. The state’s gaming commission released its September sports betting numbers on Monday, and they are sky high. Magnolia State sports bettors wagered $31.77 million and produced $5.5 million in taxable revenue during the first full month of professional and college football. Those numbers dwarf August, which had $644,489 in taxable revenue on a $7.7 million handle.
The handle includes futures bets made, while the taxable revenue does not include futures bets, many of which are not yet decided.
Most notable was the state’s win percentage, which was a whopping 17.3 percent. For comparison, that number was 10 percent in August and Nevada traditionally has a 5 to 7 percent hold.
The American Gaming Association on Thursday released the results of two more Nielsen studies, showing how America’s professional sports leagues stand to benefit from legal, regulated sports betting. The latest studies indicate that Major League Baseball will see a revenue increase of $1.106 billion, and the NBA is look at a $585 million bump. Combined with research from previous studies on the NFL and NHL, U.S. professional sports leagues can expect an overall combined revenue boost of $4.23 billion.
The increased revenue won’t come from the “integrity fee” or “royalty” that some of the professional sports leagues have been lobbying for, but rather from increased fan engagement (media rights, sponsorships, merchandise, tickets) and through gaming (TV advertising, sponsorships, data packages).
According to the studies, MLB will net $952 million from increased fan engagement and $154 million from gaming-related revenue. The NBA should see increases of $425 million and $160 million, respectively. Results of previous studies showed that the NFL will see the biggest benefit, an overall increase in revenue of $2.33 billion, and the NHL can expect an increase of $216 million.
In Las Vegas on Tuesday, New Jersey Director of the State’s Division of Gaming Enforcement (DGE) David Rebuck said that the September sports betting financial reports would be stunning.
They weren’t quite stunning, but the numbers were pretty huge: $184 million betting handle across retail sports betting operations at Atlantic City casinos and two racetracks, with the majority of the betting handle coming online, $104.8 million, versus $79 million across counters in person. Total revenue was just about $24 million, or a roughly 13 percent hold (which is a bit inflated as a result of accounting methods, explained below).
If there was ever any question about whether or not professional sports leagues would benefit from legal sports betting, it was answered Wednesday.
According to a Neilson study commissioned by the American Gaming Association, the NFL stands to see a $2.3 billion increase in revenue from legalized sports betting. The study projects that the NFL will gain about $1.8 billion in revenue from increased fan engagement, and $573 million directly from sports betting.
American Gaming Association senior vice president of public affairs Sara Slane used phrases like “great upside for all stakeholders” and “massive economic” increases when describing how sports betting would impact the professional sports leagues during a conference call with media on Tuesday.
Legal Sports Betting Must Reach ‘Full Potential’ for NFL and Other Pro Leagues to See Benefits Described in Study.
Where will the money come from? According to the study results, the NFL will benefit the most from indirect means, including “increased consumption and engagement with the league and its contents/products.” In simpler terms, the NFL will get more viewers and sell more gear creating an increased revenue stream through media rights, sponsorship, merchandise and ticket sales. According to the study, the nearly $1.8 billion in new revenue represents a 13.4 increase for the league. The NFL will see the biggest increase in revenue from media rights, which spending is expected to increase by 17.9 percent.
The post Players’ Claim of ‘Serious Consequences’ of Sports Betting Is A Hail Mary appeared first on SportsHandle.
Professional athletes are hungry for competition and compensation, and they’re now seeing the same thing as leagues, owners and gaming businesses. With an expansion of legal sports wagering taking root in the U.S., players want a nice piece of the sports betting pie.
But same as the leagues that employ them, players’ unions for the major professional sports organizations are seeking some cut of the revenue based on a faulty, self-serving premise. The leagues, of course, are asking for a direct cut of sports betting revenue based on a claim in two dozen states for a poorly-received request for a sports betting “integrity fee” or “royalty.” Now, the players’ associations are taking the position that legal sports wagering poses a pernicious threat to athletes.
As reported by ESPN’s David Purdum, Casey Schwab, Vice President of Business and Legal Affairs for the National Football League Players Association (NFLPA), said last week of expanded legal wagering: “There are serious consequences, particularly for the athletes. Because of those consequences, the athlete’s voice must be heard, particularly as we contemplate sports betting in the country.”
With The Number of Legal Sports Betting States Set to Increase, Now All of a Sudden Players’ Unions Change Claim ‘Serious Consequences’ Afoot.
Per Purdum, Schwab said the unions are concerned foremost with player privacy, data and their public perception — moreso than sports betting monetization opportunities. But now after years of being public figures, of having injury reports an accepted reality and of having reporters in their faces, for the players associations to now get amped up is ridiculous. When it comes down to it, nothing will be changing for the players or players’ unions in a world with expanded legal sports betting.
Wagering on games and specific player events has long existed in the form illegalwagering (a humongous market that will continue to exist), regular fantasy sports and daily fantasy sports. With a legal sports wagering expansion, it’s business as usual for the players. They will not be required to do anything differently. They want a piece of the pie — and naturally they would, business is business — but their argument is a Hail Mary and Aaron Rodgers isn’t at quarterback.
The argument is an extension of an April joint statement put out on behalf of all four of the major pro sports leagues. They wrote:
“The time has come to address not just who profits from sports gambling, but also the costs. Our unions have been discussing the potential impact of legalized gambling on players’ privacy and publicity rights, the integrity of our games and the volatility on our businesses.”
The unions are making an obvious emotional appeal.
The above “consequences” position boils down to the claim that fantasy sports and bettors already “dehumanize” athletes on social media after games, per NFLPA president Eric Winston, and that expanded legal sports wagering will exacerbate that.
Meanwhile, the widely accepted (and celebrated) reality is that fantasy sports and sports betting has helped explode the popularity of NFL games. There is empirical evidence on this front, and as a consequence, the engagement has helped generate incredible NFL TV contracts that increase every cycle (ditto for the other major U.S. pro leagues).
Numerous players have embraced fantasy sports and encouraged fantasy players to draft them, while some appear on fantasy-focused shows. Former Jaguars running back Maurice Jones-Drew and Chargers tight end Antonio Gates guest starred on FX’s “The League.”
Jones-Drew now co-hosts “NFL Fantasy Live.” And of course, the NFL provides its own platform for fantasy football and a plethora of fantasy sport content. If players truly have a problem with player privacy, data and their public perception, they should take it up with The Shield.
On the legal front, the notion that “publicity rights” would prohibit certain wagers or data usage on has been litigated in federal court in a fantasy sports context. The case reached the United States Court of Appeals for the Eighth Circuit, which found that information from sports contests is part of the public domain, and therefore that MLB team owners and the players’ union could not bar names and stats from being used commercially.
In the sports betting context, unions will try to distinguish wagers such “proposition bets” — for example the number of receptions Antonio Brown would have in a certain game. It’s a losing argument that will provide as much leverage as a single palm against a sled stacked high with 45-pound plates.
What about injury reporting and privacy? First of all, they were created for people wagering on sports. The league freely provides the information and if that’s now objectionable, unions can try to negotiate it away with the leagues. Nevada bettors, bettors in Europe and those wagering in other “offshore” jurisdictions where wagering is legal have been relying on this information for a long time. Why the sudden claims of privacy issues?
The availability of such information is part of being a public figure and a professional athlete. Injury reports are crucial information for fantasy sports, sports wagering, and likewise people who don’t give a damn about either. Before season-ticketing-holding Joe Fan shows up at Heinz Field, he wants to know if Ben Roethlisberger is going to be suiting up.
Players for a long time have accepted that certain health information, even the kind they probably would prefer keep private, is part of the deal. In the past, leagues have disclosed everything from weird injuries (it’s always MLB players, such as the Clint Barmes deer meat incident) to mental illnesses to quasi-health matters like domestic disputes.
Players have long gotten booed off the field for bad performances because they’re just bad performances — not because they failed to go “over” on a reception total or otherwise doom a wager. Everyone is subject from criticism at work. Getting booed is part of the game.
Ultimately, the Claim of “Serious Consequences” Is About Money.
“There needs to be a way for those of us, the players and the owners who create this game, to enjoy some of that revenue,” said NBA Players’ Association executive director Michele Roberts in an interview with ESPN’s Dan Le Batard in March. “We haven’t yet aligned ourselves to the extent we are, but I certainly don’t disagree that’s a conversation worth pursuing.”
And back to the NFL, said Schwab: “I look at the landscape for commercial opportunities, and I don’t see a pot of gold.”
[Also See: Pittsburgh Pirates Take Sports Betting ‘Integrity Fee’ to Whole New Level]
This conversation about sports betting needs to be had between the leagues and players during the next negotiations of their collective bargaining agreements. The NFL CBA discussion is expected already to be a contentious round of talks with a work stoppage regarded as likely.
The leagues may not find an overflowing pot of sports betting gold, but they are in the process of selling “official data” — player performance data, that is — to sports betting operators. There will be more partnerships and sponsorships to be had, TV contracts will become more valuable and the pie will invariably grow, and player salaries along with it.