In recent years there’s been a widespread movement to legalise and regulate gambling in an effort to increase tax revenues, with many states attempting to persuade the U.S. federal government to repeal the Professional and Amateur Sports Protection Act of 1992 (PASPA).
Movement towards the legalisation of sports betting has ramped up significantly following the widely covered New Jersey Sports Betting case that started gaining ground in 2017. Other signs of support for the striking down of PASPA included the formation of a pro-repeal American Sports Betting Coalition, with representation from the American Gaming Association and the National Indian Gaming Association.
The Supreme Court are considering whether to end the partial federal sports betting ban contained in PASPA, and a decision is expected to be made by June 2018.
If New Jersey prevails, this is expected to act as a catalyst for other states in America to legalise sports betting. In fact, many states have already introduced or reintroduced legislation that would legalise some form of sports gambling should PASPA be repealed.
Sports Betting Across the States
Even though PASPA is still in effect, interested states have started drawing up potential regulations in the event that they choose to legalise sports betting in the future. Connecticut and Pennsylvania for example have already passed legislation that will authorise regulations if PASPA is repealed.
Along with Connecticut and Pennsylvania, the following states are expected to be among the first to push through legislation to legalise online sports betting: Massachusetts, Rhode Island, New York, New Jersey, West Virginia, South Carolina, Georgia, Florida, Illinois, Michigan, Iowa, Minnesota, Louisiana, Mississippi, Oklahoma and California. Indiana and Kentucky have already introduced bills. It’s estimated that at least 11 of these states have a good chance of passing legislation this year.
Meanwhile Alaska, Hawaii, South Carolina, Tennessee, Texas and Utah have so far indicated they are unlikely to repeal PASPA.
The American Sports Betting Opportunity
If the federal ban on sports betting is repealed, this would result in many states across America adopting some form of regulated sports betting system. To put it simply, the opportunity is immense.
With a population of well over 300 million and plenty of them already enjoying a punt it’s no surprise to see so much attention focused on the potential for US sports betting opening up. In fact the Washington Post reports that the underground sports betting economy is already worth in excess of $150 million per year. Through repealing PASPA, the potential revenue from sports betting licensing and taxation is significant, which would be especially useful for those American states in need of economic stimulus and new sources of income.
And indeed, the sums certainly add up, with a report by Eilers & Krejcik Gaming diving into the monetary potential of regulated sports betting. According to the report, if thirty-two states across America offered regulated sports betting by 2023, the result would be a market worth over $6.03 billion in annual revenue.
The report also argues that professional sports leagues won’t have any interest in serving as operators. Instead, they would reap rewards from content fees, data fees and marketing partnerships. The likes of ESPN and other sports media operators would benefit from consumers having an appetite for unique content around sports betting.
Currently it appears most likely sports betting would be offered through commercial casinos or state lotteries. However, with the Supreme Court ruling on the horizon, there will inevitably be a rapid expansion in the online space, with states moving to open up the market to online betting operators keen to grab a slice of that $6.03 billion cake.
What does this mean for anyone looking to expand into the US to gain a foothold in a market set to explode? There’s a huge opportunity for bookmakers, online sportsbook operators and agencies who are prepared and ready to push their products and services to the state by state markets as they open up. This doesn’t just include operators in the U.S., but also offshore companies who are licensed to operate on U.S. shores. A ruling is imminent, and understandably plenty of operators are already mobilising and positioning themselves for an assault at the market, should the law turn in their favour.
The world of online gambling is incredibly competitive, so the smart way to put your best foot forward is by partnering with an agency fully equipped to support operators looking to enter the U.S. market. As a specialist betting and gaming focused digital agency Digital Fuel are in a unique position to assist companies poised to pounce on the US market, and have a license to operate in New Jersey. We provide an unrivalled level of expertise when it comes to new customer acquisition and retention in the gaming and betting industry so if you’re looking to take things stateside, get in touch with Digital Fuel today to see how we can help your business.