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State of Play’s TL;DR
- Legal sports betting was supposed to replace the old black-market model with a regulated one.
- A new reason analysis argues that, in practice, power has largely shifted to corporate heavyweights such as FanDuel and DraftKings – bringing tax revenue and mainstream access, but also sharper questions about marketing, market concentration, and player risk.
Reason’s article traces the sports betting boom from the U.K. success of bet365 Sportsbook to the US rollout that followed legalization in states, including in Illinois.
Illinois passed sports betting legislation in June 2019, with Gov. J.B. Pritzker backing the move as a way to keep money from flowing to other states and the black market.
Illinois gave casinos and racetracks priority for licenses, while allowing DraftKings Sportsbook and FanDuel Sportsbook to enter through co-branded partnerships. It also highlights how quickly betting moved into the sports mainstream: the Chicago Cubs announced a DraftKings partnership in 2020, and the DraftKings Sportsbook opened in 2023 at Wrigley Field.
Reason argues that the business once associated with offshore books and neighborhood bookmakers is now led by public-facing operators with massive marketing reach, especially around mobile betting and parlays.
Industry seeks amateur bettors
For players, legal access did not simply make betting safer or simpler. It also changed how sportsbooks make money.
By 2024, parlays accounted for over two-thirds of all NBA and NFL bets placed on FanDuel. Those bets are popular with casual customers because they offer big headline payouts from small stakes, but they also tend to be more profitable for operators.
An industry model favors recreational bettors over professional ones.
DraftKings CEO Jason Robins said in 2021:
“This is an entertainment activity. People who are doing this for profit are not the players we want.”
Many sportsbooks now limit or exclude sharp bettors while leaning into products and promotions aimed at amateurs.
That matters nationally because FanDuel and DraftKings are not niche brands in one state. From 2019 to 2024, DraftKings gained about a third of the legal American sports betting market, even while reporting cumulative net losses of over $5 billion. The broader takeaway is that scale, customer acquisition, and retention remain central to the US betting fight.
The next phase of US sports betting will revolve around familiar pressure points:
- How states regulate advertising
- How operators balance growth with responsible gambling concerns
- Whether legalization meaningfully reduces black-market activity without creating new consumer-harm issues
Based on reporting by David Bockino for reason.
