On May 14, 2018, the U.S. Supreme Court struck down a federal statute that for 26 years had restricted regulated sports betting to primarily Las Vegas. Everywhere else, one of America’s oldest pastimes — betting on sports — was relegated to the shadows.
Up until just a few years ago, the NFL and other leagues claimed bettors and bookmakers would cause irreparable harm to sports if other states were allowed to get into the bookmaking business. And other than a few veiled references to the point spread by broadcasters, sports betting was rarely referenced in the media.
Now, three years after the game-changing Supreme Court ruling, all the major professional leagues have official betting partners and sports betting is in your face more than ever. It’s inescapable.
Signage for sportsbooks can be seen on the floors at NBA arenas and in the outfields at Major League Baseball stadiums. Billboards for bookmakers line highways in many of the 21 states that have launched betting markets, and TV ads for sportsbooks are airing as frequently as commercials for soup, which is legal in all states.
There’s more.
Bookmakers are turning themselves into sports entertainment, multimedia outlets, complete with award-winning journalists and celebrity talking heads — while, at the same time, taking bets on the games they’re covering.
Meanwhile, American bettors are lapping it up, wagering on everything from Ukrainian table tennis to boxing matches on YouTube. In March alone, $4 billion was bet with U.S. sportsbooks, the most ever in a single month.
It’s only the beginning of what’s expected to mature into the largest legal sports betting market in the world. Just ask the NFL.
“It’s going to be a massive revenue stream when you look five to 10 years out,” Chris Halpin, the NFL’s chief strategy and growth officer, said of sports betting.
‘It’s like nonstop sports betting’
Colorado fishing guide Joe Kerekffy is sitting on frozen Lake Dillon, surrounded by the snowcapped Rocky Mountains, trying to catch trout on a sunny morning in early April.
No way sports betting can disrupt this peacefulness.
Kerekffy is an easygoing, 54-year-old from California who fishes and skateboards for relaxation and isn’t really a sports fan. He’ll occasionally watch a NASCAR race, but only if it’s on a major network. It helps keep his cable bill down, he says.
The college basketball national championship game between Gonzaga and Baylor is tonight, and the topic of Colorado’s new sports betting market is broached.
Suddenly disgusted, the mild-mannered Kerekffy begins to rant: “The ads, I can’t stand them. It’s like nonstop sports betting. If I’m watching the news, I see the same advertisement two or three times in a half hour. It’s repetitive, annoying and so sensational. It’s become ridiculous.”
Remember, he’s not even a sports fan, and he’s still getting inundated with sports betting ads.
During a six-month span from Sept. 1, 2020, to March 31, 2021, a stretch that saw the return of mainstream sports from the pandemic shutdown, the top sports betting companies accounted for 10.61 billion TV ad impressions, according to ad measurement company iSpotTV.
“They’re right below canned goods and soups,” Tyler Bobin, brand analyst for iSpotTV.com, told ESPN.
In the first quarter of 2021, Nielsen reported that the online gambling industry, primarily sports betting, spent $154 million on local TV advertisements. With the jarring increase in advertising — from none to a ton — there’s fear that backlash from regulators and lawmakers is coming, including at the NFL, which after naming Caesars Entertainment, DraftKings and FanDuel as the league’s first official betting partners in the U.S., is prepping to allow ads for sportsbooks this season.
According to Halpin, the NFL is looking at putting “frequency caps” and limiting shares of games that are accessible to sports betting advertising. It’s a difficult balancing act, and in other countries, when the gaming industry was too aggressive with advertising during games, there have been negative consequences.
“It’s a big step for us,” Halpin said. “We’re going to be very thoughtful in how we open up inventory and in what ways. We have clear segments of our fan base that love sports betting, that have casual interest, that don’t care and that hate it. We can use a whole bunch of tools to serve the first couple groups and not upset the last group. And that’s what we’re doing.”
American sports fans likely remember the ad blitz for daily fantasy contests that hit the airwaves around 2015. At its peak, an ad for FanDuel or DraftKings ran on national TV every 90 seconds, according to iSpot.TV. The commercials introduced mainstream fans to daily fantasy sports but also attracted unwanted attention from some state attorney generals. The following year, DraftKings and FanDuel paid $12 million combined to settle a suit with the New York attorney’s general office that was centered on deceptive advertising.
“Where we got some blowback from DFS was the way that ads were presented, the messaging,” DraftKings co-founder and CEO Jason Robins told ESPN in a recent phone interview. “So we’re being very cognizant of trying to learn from that experience and present the product and the brand in a different way.
“Really, from both what we learned from our earlier DFS days as well as the collaboration that I see within the industry, I’m very optimistic that there’s a lot of thought being put into how the advertising is being done and the messaging,” Robins added. “And I think that’s hopefully going to create a very positive reception from the marketplace.”
Americans aren’t only seeing sports betting ads on TV and online. Since 2018, ads for sports betting on billboards, public transportation and outdoor furniture are up 193%, according to data from the Out of Home Advertising Association of America (OAAA). In 2020, $11.5 million was spent on out-of-home sports betting advertising. That’s approximately half of the amount spent on similar political ads, per the OAAA. Like soup, politics are legal in all 50 states; sports betting is legal in roughly half.
“There’s going to be big money spent,” said Scott Harkey, president of OH Partners, a full-service ad agency that represents brands such as MGM and Wynn, of the growing sports betting market. “Similar to political advertising, I do think it’ll get a little noisy and people will get annoyed. But I think we’re far from saturation.”
Bookmakers transforming into media outlets
Not long ago, talking about sports betting in the media was awkward and ambiguous.
Millions of Americans were combining to bet billions of dollars, but, in order to keep in good standing with sports leagues, you couldn’t talk about it on air. That has changed.
For media outlets, including ESPN, sports betting is no longer a taboo — it’s a revenue stream.
Bookmakers have started to cut out the middle man, though, and are transforming themselves into their own media outlets. Sportsbooks have begun producing game previews and releasing predictions on sports that they’re also setting the odds for and taking bets. Despite the inherent conflict of interest, it appears that’s what bettors want, too.
Survey results from consulting and marketing firm Hot Paper Lantern showed that bettors want to use their sportsbook for more than just placing a bet; 69% of bettors said they desired betting tips, even if it comes from the bookmaker they’re betting against.
DraftKings is trying to navigate that dilemma with its recent purchase of Vegas Stats and Information Network (VSIN), a sports betting platform featuring legendary broadcaster and gambling enthusiast Brent Musburger. According to financial disclosures, DraftKings paid approximately $69.9 million in cash and stock for VSIN.
“A point that we made crystal clear on day one that there was absolutely going to be a separation between content creators on VSIN and anyone that’s making odds or trading on the DraftKings sportsbook side,” Robins said.
DraftKings is not alone in the convergence of bookmakers and media outlets. Instead of Fox Sports Networks, for example, we now have Bally Sports, 19 rebranded regional sports networks that eventually will be accompanied by Bally Bet, an upcoming sportsbook app. In January 2020, gaming operator Penn National purchased Barstool Sports and subsequently launched the Barstool Sportsbook.
“As television continues to decline, in not only ad revenue, but also audience, large brands that have the resources are going to continue to produce content and almost act like media companies,” Harkey said.
Other bookmakers are choosing to produce content in-house and are attracting established journalists and personalities away from more traditional media outlets.
In October, sportsbook PointsBet hired longtime Chicago Tribune sports columnist Teddy Greenstein as senior editor to spearhead its content production. Greenstein covered U.S. Opens, the Masters and historic Big Ten football games during his 24 years at the Tribune, but he calls his current gig “the perfect job.”
“Every day, I should be thanking the Supreme Court,” Greenstein said.
In addition to his role as “resident grammar nerd,” Greenstein hosts PointsBet’s golf preview show, “The Range,” with social media influencer Paige Spiranac, produces written content and potential prop offerings, entertains VIPs in Chicago and makes regular media appearances that differ in subject matter from the TV and radio spots he did while at the Tribune.
“It was always that grey area with sports writers, like how much you could talk about betting,” Greenstein said. “In some ways, we’d always talk around it. I’m so glad I’ve lived to see this day.”
For years, Greenstein would pick every Big Ten football game against the spread in his Tribune column and subsequently cover some of the same contests as an opinion columnist. He would make self-deprecating jokes about his record in his column and has maintained that tone with the picks he’s now making for PointsBet. At the same time, he realizes the conundrum that comes with making betting predictions that, from a financial standpoint, his employer might be rooting against.
“It’s not like I get a cut if I make some predictions that goes south,” Greenstein said. “I’m absolutely rooting for people to do well. We’re a big company. We make enough money, so I’m dying for my golf picks to hit.”
People are betting on what?
Like many of us, Eugene Romero, a 37-year-old husband and father in Denver, was looking for something fun to do as the coronavirus pandemic took hold last spring and summer in the U.S.
He wasn’t going to the office much, sports had essentially stopped, and the casinos, bars and restaurants he frequented were closed. Romero found a reprieve late at night in a dark corner of his house.
For a two-week stretch, late last June, after his kids and wife were in bed, Romero would retreat downstairs to the kitchen, have a few Bud Lights and bet on table tennis, a quarter at a time. He’d watch matches between Russian and Eastern European players on his phone until the sun came up the next morning.
“I was falling in love with it. Twenty-five cents on the underdog would win me like 16 bucks,” Romero said. “It was incredible.
Romero estimated he risked no more than $500 total — never more than a few dollars at a time — during his two-week, late-night ping-pong betting fling. He bet almost exclusively on underdogs and, to start, had no idea who any of the players were or their skill level.
The return of traditional sports, in addition to his wife getting on him for staying up all hours, eventually curtailed his ping-pong moonlighting
“I doubled my money,” Romero said.
With mainstream sports leagues halted, bettors looked for alternate opportunities. Some shifted to betting on simulations of video games, including Madden NFL. NASCAR offered virtual racing events, and sports betting companies help put together pop-up tennis tournaments. None of the new events people began betting on during the pandemic had the lasting power of table tennis, though.
In March, approximately $8.8 million was bet on table tennis with Colorado sportsbooks. That’s more than was bet on MMA and golf combined during the month. There are dozens of international table tennis matches a day, some are streamed live on DraftKings’ mobile betting app, often after midnight when no other U.S. sports are in action.
“Certainly, if you asked me a couple years ago what table tennis betting would be like, I might not have said it would be as popular as it is now, but it also makes sense,” Robins said. “I think it really fits well with in-game betting with the point-by-point nature. And it doesn’t have to be a lot of money. It can be betting 25 cents and having a great time. That epitomizes what I think our product should be about — giving people enjoyment for not a lot of money.”
Coming soon: made-for-betting events
Sports betting wasn’t even on Ryan Kavanaugh’s radar when his digital entertainment and music platform Triller started looking at organizing and streaming celebrity boxing matches. Then he saw how much interest the fights were attracting at sportsbooks and changed his mind.
YouTube influencer Jake Paul’s bout with UFC fighter Ben Askren that was streamed on Triller was the most heavily bet boxing match of the year to date at multiple sportsbooks. The betting on the fight included a $160,000 wager on Paul placed at Caesars Palace in Las Vegas. Paul won with a first-round knockout.
“Not being a sports bettor myself, I assumed that sports bettors would only bet on something that’s incredibly serious,” Kavanaugh, co-owner, principal and director of Triller, told ESPN. “I assumed wrong.”
Triller partnered with DraftKings this year in a deal worth $20 million, according to a source familiar with the arrangement. But sports betting has become so attractive to Kavanaugh that he says Triller will examine adding its own betting platform at the end of the year. Down the road, he sees the possibility of giving away the broadcasts of fights to bettors who bet more than a certain amount.
“On fights, since we’re talking directly to the customer who’s buying the event, it’s pretty easy to parlay that into, ‘Hey, do you want to make a bet on this since you’re buying it?'” Kavanaugh said.
Triller is not alone in recognizing the value of sports betting interest. Dan Ghosh-Roy, a spokesman for the Professional Fighting League, told ESPN that “betting is a big priority for us as a business in general and particularly how we plan events.”
Don’t be surprised if made-for-betting events start popping up in the near future, and it’s all because of what happened just after 10 a.m. on Monday, May 14, 2018. That’s when the U.S. Supreme Court released its landmark ruling, striking down the Professional and Amateur Sports Protection Act of 1992 and jumpstarting a three-year betting boom.
Within a month of the ruling, Delaware and New Jersey launched full-scale sports betting markets. Three years later, legal sportsbooks are operating in 21 states and the District of Columbia. Big states such as California, Texas and Florida aren’t on board yet, but they’re looking at it closely. It won’t be long before more than half the U.S. has regulated sports betting.
In the first four months of 2021, sports betting generated $961.1 million in revenue, according to the American Gaming Association. That’s $50 million more than U.S. sportsbooks produced in all of 2019.
In 2017, the year prior to the Supreme Court decision, Nevada sportsbooks — the only fully legal options in the U.S. at the time — earned a net $248 million.