Major League Baseball decided that if it couldn’t get a piece of the sports betting pie, it would divert revenue in any way it could, starting with advertising.
“We have been informed that club television and radio rights holders are being approached by sports books to place advertising/enhancements. Pursuant to MLB policy, clubs must inform their rights holders that they are presently not permitted to accept such advertising. Clubs may not at this time enter into any relationship with a pure sports book, or with a casino with a sports book to the extent that the arrangement involves sports betting.”
Getting a piece of the betting pie
This appears to be a losing battle for sports leagues. Even so, they are attempting “cooperation” via integrity fees and greater regulation.
Before the Supreme Court ruled on sports betting, the leagues were in violent opposition to sports betting. Now, the leagues are calling for regulations to avoid game fixing and ruining the integrity of the sport.
MLB’s investigations chief, Bryan Seeley, argued that casinos should share sports betting information with the leagues for that very reason.
“You can say that you care about integrity too,” Seeley said of bookmakers to Reuters. “But when you turn around and oppose any requirement that you let the leagues know about integrity problems, it is hard for me to believe you.”
John Wolohan, a professor of sports law at Syracuse University, told WHYY that it looked like the sports leagues were saying that if they couldn’t get in on the action, they weren’t going to accept ads for the casinos to build that business. He continued:
“The fact that they’re getting a piece of the pie, that they’re invested and partners with [fantasy sports operators] DraftKings and FanDuel just goes to show that, if they can get some money, they’re OK with [gambling]. But if they’re going to be excluded, they’re going to play hardball, so to speak.”
The DFS vs. sports betting conundrum
While MLB won’t accept ads from sportsbooks, it will accept ads for daily fantasy sports, particularly from DraftKings. MLB owns equity in the DFS operator, and while DraftKings is looking to open a sportsbook in New Jersey, word is still out over whether they will advertise, reported Legal Sports Report.
The issue here seems to be in the similarities between sports betting and DFS.
“Some people would call it hypocrisy,” said Andrew Brandt, executive director of Villanova University’s Jeffrey S. Moorad Center for the Study of Sports Law, to WHYY. “I think any rational person would say fantasy sports is gambling.”
The fight for/against integrity
Jennifer Roberts is the associate director of the International Center for Gaming Regulation at the University of Nevada, Las Vegas. She said the key difference in what the leagues want in their integrity fees is where the share is coming from. They want a share of the bets placed on games instead of the share of revenue.
She gave the 2018 Super Bowl as an example to the Center of Public Integrity, stating that of the $158 million bet in Nevada, sportsbooks took in $1.17 million in revenue or 0.7 percent of bets. This came after paying out winnings.
So while the sports leagues have succeeded minimally in drafting model legislation, some lawmakers see a compromise in the future.
“With sports betting, there’s going to be an increased burden for the leagues: There has to be technology upgrades, and you may have to hire a few more people to handle integrity monitoring at a much higher scale than now,” said John Bonacic, a New York Senator who has met with top officials from MLB, the NBA, and the PGA, to the Center for Public Integrity. “That’s why I felt we’d have to make a compromise.”
New Jersey Senate President Steve Sweeney sent a fairly pointed letter to governors and legislative leaders about these fees.
“Now that [the leagues’] efforts have been ultimately unsuccessful they wish themselves to make ‘the fast buck’ and to ‘get something for nothing. Ironically, they are calling this extortion attempt an ‘integrity fee,’ even while fully aware that providing participants a stake in the volume of betting would amount to what could more accurately be called an ‘anti-integrity’ fee.”
Monmouth Park still gaming
A Monmouth Park spokesperson presumed that these tensions could be the reason for this memo.
In the New Jersey bill signed into law by Gov. Phil Murphy, language was removed giving the leagues a cut of the bets.
Dennis Drazin, Monmouth CEO and president, tried to buy advertising space for his law firm. Instead, they wouldn’t let him advertise.
He told ROI that the leagues should be working with him, instead of against these sports betting entities. Instead, he is now investigating to see if the memo qualifies as an FCC violation. This is in addition to the suit Monmouth Park has against the MLB and the other leagues for damages.