They stir at the starting gate, thoroughbreds ready to sprint.
Their imminent race concerns the projected windfall of expanded legalized sports betting. These “horses” could be state regulators, gaming-service companies or operators. The jockeys could be lawyers trying to overturn the onerous Professional and Amateur Sports Protection Act (PASPA) in the United States Supreme Court. This would open the gates for casinos, online suppliers, lotteries and at least 20 American states to embrace a new, multibillion-dollar market.
The gaming industry considers this day overdue. PASPA, enacted in 1992 to let sports leagues block most sports-betting wagers, has all the popularity of prohibition a century ago—and about the same enforcement aptitude. Billions of dollars are bet illegally in the United Stats every year, close to $5 billion alone for the Super Bowl, while cash-starved state governments bemoan the lack of tax money and casinos chafe over a suppressed revenue stream.
Operators expect the demise of PASPA, now that sports leagues revealed their hypocritical hand. The leagues, which decried illegal gambling, will soon have both pro hockey and football franchises in Las Vegas. Their push for “integrity” now appears as a crippling tax on legal wagers, not the sanctity of their games once professed. And the NFL’s opposition to fantasy football stopped once it began pocketing revenue.
Given these factors, New Jersey was listed as a 2-1 favorite to overturn PASPA last December. How fitting for a sports-betting legal case to have odds.
With the Supreme Court decision expected for the second quarter of this year, operators monitor it daily. And they get ready, either for the overturn, the court kicking it to Congress, or the chance to defy the ban by placing sports betting inside of some state regulations and making others block them.
While the Supreme Court case impacts states’ rights in the long term, gaming interests look to win now. Monmouth Park racetrack in New Jersey, for instance, was ready to offer March Madness betting had the rule been lifted.
The gaming players wait impatiently, ready to roll. Once the race begins, the first steps are important.
In the Right Spot
International Game Technology, the global gaming-machine, lottery and research and development powerhouse, finds the best place to apply new products to a hot trend. The sweet spot is PlaySpot.
The London and Las Vegas-based company appears poised to embrace the sports-betting bonanza with PlaySpot, a turnkey mobile sports wagering solution that can be deployed by a casino of any size. If an operator has an existing mobile convenience app, the sports betting functionality can be incorporated into that app, or IGT will collaborate with the customer to create an independent portal. If a mobile wagering solution is not ideal for an operator, IGT can work with the customer to create a sports betting solution that better suits its players.
Charles Cohen, IGT’s vice president for mobile, PlaySpot and North American sports betting, forecasts a prosperous era.
“I often liken the state of sports betting to a dormant volcano,” he says. “At the surface, it appears perhaps that not a lot is going on, but below the surface there is a storm of activity. The addressable market for a sports betting solution in the U.S. is vast. IGT’s PlaySpot represents a proven, mobile wagering solution that we believe can meet the needs of a broad range of casino operators and wide demographic of players.”
Cohen says any casino interested in extending play from its gaming floor to include areas such as pools, restaurants and beyond can benefit from PlaySpot technology. For example, PlaySpot users in Nevada can place mobile sports bets from any location within Nevada’s state lines via MGM Resort International’s PlayMGM application. If PASPA is repealed, casino operators in all parts of the country could potentially offer their players similar mobile wagering opportunities, he asserts.
Cohen sees a double dynamic for PlaySpot.
“For the player, it is the mobile user experience,” Cohen says. “PlaySpot has in-app features such as the ‘trend cloud’ which reveals the most popular bets of the moment. The option for in-game betting, search capability and the ease with which players can create parlay cards are among the most embraced features within the app.
“For the operator, the in-depth, real-time player insights that PlaySpot can generate is a key factor. Through PlaySpot, sports book operators can gain a holistic view of their players, including their betting patterns and preferences. These robust player insights enable casinos to create deeper, more personalized casino-patron relationships, and ultimately differentiate their offering.”
Cohen says that in developing PlaySpot, IGT drew upon decades of experience in building gambling apps for the European gaming market. The U.S.-centric product that is currently live with MGM Resorts International went through approximately one year of Nevada field trials prior to its official approval, which was granted in April 2017.
“What PlaySpot customers are buying into is not one particular type of gaming—like sports betting or live table betting—or even one version of an app and user experience,” Cohen says. “Customers are taking on a new way of doing business, and PlaySpot is a platform for that. Every casino that deploys PlaySpot is getting a service and technology which will evolve over time to offer new player experiences, new ways to play, and new opportunities to tie the land-based casino experience into the digital world of the consumer.”
The Digital Age
Las Vegas powerhouse Scientific Games had a glimpse of the future when it made two major moves early this year. It established SG Digital and lined itself up as a prime industry force by obtaining a major solution, OpenBet, via the acquisition of NYX Gaming. Scientific Games completed its acquisition of NYX in January, adding a major global sports betting platform to its portfolio. In February, it announced SG Digital.
Assembling established brands in iGaming, sports betting and iLottery, SG Digital is an integrated industry leader boasting products from the company’s nine in-house game development studios—including Bally, Barcrest, NextGen and WMS Gaming. The division will also leverage the company’s offerings, including SG Universe, an online solution for land-based casinos, and OpenBet, a leading sports betting solution.
OpenBet Sportsbook, in particular, positions SG Digital to capitalize on future regulatory developments in real-money wagering and sports betting. This digital Sportsbook can be seamlessly delivered throughout Scientific Games’ global gaming and lottery networks in existing and future-regulated U.S. and global markets.
“If PASPA is repealed, the rapidity with which the states are legalizing sports betting will be unprecedented,” says Quinton Singleton, the company’s vice president of corporate strategy and government affairs. “Certain states are targeting immediate go-live following a favorable SCOTUS decision and others are looking to go live shortly afterward in the second half of 2018. We are actively engaging with gaming regulators and preparing for the market opening.
“The repeal of PASPA would be an industry-changing event like we have never seen. The United States is a massive market with millions of potential players who have unique interests and needs from a sports-betting perspective. Casinos and gaming operators would immediately enter the fray, but we also expect to see different industries take an interest in the space. Legalization would entice companies across various entertainment industries to take notice and, more importantly, take advantage of the opportunity.”
The growth opportunity is tremendous, he says. By certain estimates, the U.S. sport betting market, if legalized, would be around $150 billion. And there’s only room to grow from there.
Singleton is confident that OpenBet will become a force for SG Digital. It has been a pioneer of online sports betting since the market’s inception, driving the sector forward though innovative developments across retail, web and mobile. OpenBet powered the first online sports book back in 1998, ahead of the World Cup in France.
The product has become a juggernaut in the sports-betting arena. OpenBet can process tens of millions of bets in a single day. The scale of the product’s performance is remarkable, he says. In 2017, Amazon processed nearly 9 million transactions on “Amazon Prime Day.”
During the 2018 Cheltenham Festival, a tent pole horse racing event in the U.K., OpenBet processed more than 10 million transactions in a 24-hour window.
“OpenBet’s sheer power and performance is unprecedented,” says Matt Davey, group chief executive at SG Digital. “It’s a product that revolutionizes its space by carving out new opportunities for customers and players while driving our growth. It is nearly impossible to overstate the opportunity that the potential PASPA repeal presents. This one event would create ripples throughout the industry and open new doors for providers everywhere. Looking to the future has never been more important than it is now, because the future we’ve envisioned has never been closer to becoming reality.”
And what a time to buy in. The company looks poised for the online/brick-and-mortar phenomenon, spread across computers, mobile devices, kiosks and perhaps avenues yet to be determine. The new market could show up in lotteries, casinos, tracks or tribal entitles.
At the moment, all eyes are on Pennsylvania, New Jersey, Mississippi, New York and West Virginia for the next potential legalized betting influx, according to Singleton. That list is expected to grow, making it imperative to hit the ground running.
On the Radar
For Sportradar, a prominent supplier of data, technology and services to the sports betting market, the floodgates could open once PASPA, and its affiliated shackles on sports betting, becomes passé. They may even open without the extinction of PASPA.
“This is not true just with the casinos,” says Neale Deeley, the company’s vice president of sales and gaming. “The general sense in the market is that it’s no longer a question of if, it’s a question of when, even if PASPA isn’t overturned. While nobody knows exactly the answer to that question, casinos are making educated guesses and are putting in place plans to be ready.”
Sportradar, based in Switzerland, has been a force wherever betting is legal, from the established markets in Europe to the emerging continent of Africa. The company provides everything from simple scores updates to full turnkey sports books, complete with sophisticated trading and risk management services. It also supplies live odds to several Nevada casinos and suppliers, including CG Technology and Station Casinos, according to Deeley.
“Experience in other countries and product verticals shows just how important it is to be ready for when the market opens,” he says. “While there is no guarantee that those who are live on the opening day will be the market leaders of the future, it does significantly improve the prospects. While we can’t control the world, we can control our own actions, and we are ready for legal sports betting across the U.S.”
For Sportradar, in-game wagering has proliferated. Being efficient up to the minute is an accomplishment, yet being efficient up to the millisecond is a “cha-ching” fest. That’s the reality of in-game wagering, perhaps sports betting’s ultimate indulgence. Shifting odds, wagers and sentiments must be accomplished faster than the blink of an eye.
Deeley believes the sports-betting industry eyes a surge.
“This presents the U.S. gaming sector with the biggest opportunity in years,” Deeley says. “Globally, sports betting is around 15 percent of all revenues from gambling activities across land-based, online and mobile. Underneath that headline figure are some very interesting and hugely important trends.
“In the online space, betting is firmly established as the largest driver of activity, with approximately half of all revenue coming from betting and in the fastest growing of all channels—mobile betting accounts for three out of every four dollars with the majority of that coming from in-play wagering.”
Speed is the execution of that blueprint. Snap the fingers and wager again.
“Ultimately, all sports betting is reliant on fast and accurate data,” Deeley indicates. “Without it, bookmakers wouldn’t be able to price events or settle bets. As technology has advanced, so has the sophistication of the data provision to the point we are at today, where it takes less than a second from an event happening on a sports field somewhere in the world to the bookmaker updating the odds. This has greatly enhanced the betting experience for gamblers, as can be seen by the explosive growth in mobile and in-play wagering.”
Deeley asserts that Sportradar is the official and exclusive data partner of the major leagues in the United States, including the NFL, NBA, NHL and NASCAR, but it also has integrity partnerships with NBA, NHL, MLS, etc., in the U.S.
“Worldwide, we have more than 100 official data relationships with leagues and sports organizations,” Deeley says. “We have direct relationships and advise all our partners on the developments in the U.S., but also share global experiences and knowledge on good and bad practices.”
According to company officials, that has been a boon to the sports leagues.
The Sportradar bet monitoring, intelligence and investigation, education and prevention, regulatory and consultancy solutions are used by over 70 sports federations around the world, company officials say.
The swirl of activities continues. Collectively, government and gaming root for the demise of PASPA. Then they must become responsible partners. Sports-betting revenue must be taxed sensibly, probably at less than 10 percent, to be viable. The states that eye this money can’t be greedy.
The entities working side-by-side today must be unselfish tomorrow. Otherwise, the race won’t produce a winner.