The Nevada Independent

Your state. Your news. Your voice.

The Nevada Independent

NFL could reap $2.3 billion a year from legal sports gambling, AGA study says

Humberto Sanchez
Humberto Sanchez
CongressGaming
SHARE

Revenues for the National Football League could increase by $2.3 billion a year by 2020 as a result of legal sports gambling following a Supreme Court ruling in May that overturned the existing ban, according to a study commissioned by the American Gaming Association (AGA).

“This research makes clear that legalized sports betting will generate significant economic upsides and tremendous value for all stakeholders,” Sara Slane, senior vice president of public affairs at the AGA, told reporters on a conference call Wednesday.

The study comes after members of Congress, including Senate Democratic Leader Chuck Schumer and Sen. Orrin Hatch, R-Utah, have signaled their desire to enact federal regulations for sports gambling.

The pitch from the AGA—which represents gaming companies, including Las Vegas-based Caesars Entertainment, Las Vegas Sands Corp., MGM Resorts International and Wynn Resorts Ltd.— is aimed at addressing concerns of the nation’s top sports leagues, which worry that sports betting could undermine the legitimacy of their games.

The sports leagues have called for so-called integrity fees to be added to each bet to help cover the cost of policing games to keep them fair, with the fees flowing to the sports leagues, though critics see this as a way for the leagues to directly benefit from the new sports betting revenue. The AGA has said it supports enforcing the integrity of games through establishing a national data repository to share any suspicious betting information with law enforcement, gaming regulators and other sporting regulatory bodies. The AGA also opposes federal or state regulations that would mandate the purchase of sports data needed to run a sport books operation.

Nevada gaming companies stand to gain as more states decide to allow sports betting, resulting in new business opportunities. In late July, the National Basketball Association named MGM its official gaming partner.

The AGA study is designed to highlight the ancillary financial gain that awaits the NFL, the most popular sport in the nation, and potentially other leagues, including Major League Baseball and the National Hockey League, from legal sports betting.

“What everyone should be taking away from this study is that when the leagues are pushing for integrity fees and or legal requirements for purchasing of data, they really are tripping over dollars to pick up pennies when it comes to the grand scheme of the revenues that they would gain through legal sport betting,” Slane said.

According to the study, conducted by Nielsen Sports, legal sports betting could help the NFL boost revenue by $1.75 billion from increased consumption of the league’s products, including a rise in revenue from media rights, sponsorship, merchandise and ticket sales.

“There is obviously an increase in viewership,” Slane said. “Sports betting is a way to increase fan engagement because most fans then have skin in the game and they are more interested in watching the entirety of the game.”

Another $573 million in revenue would come from spending by betting operators and data providers, according to the AGA study. That includes $451 million in projected advertising spending by gaming operators. An additional $92 million would come from gaming sponsorship revenue and $30 million from data and product revenue for third-party gambling services

The NFL would reach these figures when it reaches 100 million viewers, which is estimated to happen in 2020, according to Slane.

The AGA maintains that the growth market is in in-play betting, which allows gamblers to place bets after the game has started, such as who will score the first touchdown.

Members of Congress have been circling the issue recently.

ESPN reported last week that Schumer drafted a memo on the issue, which included “the idea that all sportsbooks only use official league data to determine outcomes and that the sports leagues themselves should be involved in determining what bets would be accepted,” the article said.

The NBA, MLB and PGA released a joint statement supporting Schumer’s position.

“As legalized sports betting spreads across the states, there is a need for consistent, nationwide integrity standards to safeguard the sports millions of fans love,” the group said. “We strongly support the legislative framework outlined by Senator Schumer and we encourage Congress to adopt it.”

The AGA, which supports states taking the lead on regulations, was less sanguine.

“New federal mandates are a nonstarter,” the AGA said in a release. “The casino industry is working with stakeholders to ensure the proper protections for consumers, and the integrity of bets and sporting contests are included in state policy, universally implemented by all operators in those states, and overseen by effective state and tribal gaming regulators.”

Schumer’s comments followed a speech given on the Senate floor last month by Hatch, who has long been an opponent of sports betting and was an original author of the law banning sports betting that was overturned by the Supreme Court.

Hatch reiterated his intention to introduce a bill regulating sports betting, though it’s unclear when he will unveil his legislation. His office said he hopes to introduce it before the end of the legislative session.

“As states move to legalize sports wagering, we must seize the opportunity to put in place world-class measures to protect the integrity of our sporting events and the sports betting market,” Hatch said. “To that end, an important part of the legislation I will be proposing is improvements to monitoring and enforcement that will benefit all of the stakeholders – sports books, regulators, governing bodies, and consumers.”

Disclosure: MGM, Wynn and Caesars have donated to The Nevada Independent. You can see a full list of donors here.

SHARE

Featured Videos

7455 Arroyo Crossing Pkwy Suite 220 Las Vegas, NV 89113
© 2024 THE NEVADA INDEPENDENT
Privacy PolicyRSSContactNewslettersSupport our Work
The Nevada Independent is a project of: Nevada News Bureau, Inc. | Federal Tax ID 27-3192716