Thanksgiving has passed, which means it’s time to start preparing for the end-of-year holidays. A time to set out resolutions for the New Year and plan to do better. But before we say goodbye to 2019, we are going to take a look at the top gambling news stories of the year.
As the year ends, we are replete not just with turkey, but with good news. All is well, and all news shows the US heading in the right direction as more and more states introduce legal sports betting and online gambling.
But 2019 didn’t start that way. In fact, the year began with an existential threat to US online gambling that rumbled on until late summer.
So, to begin our list of the top 10 stories of 2019, let us go back to the misery that followed the Department of Justice’s reinterpretation of the Wire Act.
#1: The DOJ’s revised opinion of the Wire Act threatened states with legal online gambling
The Department of Justice (DOJ) plays a Jekyll and Hyde role in the history of US online gambling. Back in 2011, it launched an attack on online gambling that saw online poker virtually exit the US. Black Friday changed lives, but almost as soon as it happened, the DOJ resumed the guise of Dr. Jekyll and issued a new opinion of the Wire Act.
The new opinion allowed states to enact their online gambling legislation. New Jersey, Delaware and Nevada got straight at it and soon had online poker up and running.
Then, after a few years in the shadows, Mr. Hyde returned and the DOJ issued another revised opinion of the Wire Act. This time it was not so good. It threatened to reverse all the gains of the previous seven years. There was a real prospect that existing state-regulated online poker and casino games would have to stop.
The roll-out of sports betting in states like Pennsylvania suddenly appeared to be in doubt. Regulators issued warnings to operators that they must comply with the new interpretation but without explaining how to achieve this contradictory position.
Fortunately, in June, the Federal District Court in New Hampshire decided that the first revised opinion was the right one. The industry breathed a collective sigh and then took in a deep breath as the DOJ appealed the decision.
For now, the DOJ’s threat has disappeared. However, much like the denouement of a B-rated horror film, just as the dust settles, there is always the chance that the evil Mr. Hyde will return.
#2: The merger of Caesars and Eldorado
Caesars is a huge brand in US gambling. Its iconic Las Vegas properties are almost the defining cultural symbols of the gambling industry. But Caesars got too big for its boots and went bankrupt in 2015.
Restructuring brought the company back by 2017, but it was still weak. Then came the Supreme Court decision that paved the way to legal sports betting.
Big shareholders started to agitate for a sale or merger, realizing that even multibillion-dollar companies were too small to take advantage of the new opportunity.
Eldorado owns casinos in a bunch of states, but it too was a bit player in a game that had suddenly gotten huge.
On Nov. 15, shareholders approved a merger of the two companies, which will keep the name Caesars Entertainment. Sensibly, Eldorado’s CEO will be the boss of the new team. He will have a company big enough to play nationwide and globally. The great gambling icon is saved.
#3: New Jersey DGE allows betting on the Oscars
It was a one-off in 2019, and it was trivial. But it was one of the most imaginative acts ever undertaken in the US by a gambling regulator.
New Jersey’s Division of Gaming Enforcement (DGE) gave permission for the state’s casinos to take bets on the 2019 Oscars.
The Oscars aren’t a sport; there isn’t a game involved. The Academy Awards is only a big show with a big audience. If the DGE can take this purely business attitude to allow betting for fun, then New Jersey’s future as a gambling hub is assured.
It is hard to imagine any other state gaming regulator taking the same decision. Possibly the Nevada Gaming Control Board, which has led the way on allowing bets on esports, but even for them, the Oscars are probably a step too far.
#4: Super Bowl 2019
There was something special about Super Bowl LIII. And it wasn’t just that the Patriots were going for their sixth victory.
This was the first time that fans outside of Nevada could legally bet on the game. To be clear, something like 95 percent of the total money wagered on the match was bet illegally. But in New Jersey, on Feb. 3, honest fans could put their money on the table in a safe and legal environment for the first time.
What was really funny was that the fans beat the bookies. New Jersey DGE figures showed that $34,894,900 was wagered on the game, but fans won $39,469,147. A $4.5 million victory for the sports betting fans, a record that might be harder to beat than the one now held jointly by the Patriots and the Steelers.
The old soaks over in Nevada could still smile. The more experience bookmakers in sin city recorded $145,939,025 and made a nice profit of $10,780,319.
Their smiles weren’t quite so wide as you might expect. For the first time in 11 years, Nevada took in less handle on this year’s Super Bowl than the previous years. New Jersey bookies may have made a loss, but it looks like they took some early market share from Nevada. Time will tell what happens with the Super Bowl in 2020.
#5: New Jersey takes more sports bets than Nevada
May brought some fun statistics. For the first time, the monthly sports betting handle in New Jersey was higher than in Nevada.
A few weeks later, June brought the anniversary of the first legal sports bet in New Jersey and the DGE numbers showed that a total of $3.2 billion was wagered in Year One.
For years, Atlantic City has played second fiddle to Las Vegas. Now that it can also offer legal sports betting, the impact of a population more than three times that of Nevada is showing through.
Nevada’s tourist traffic provides a massive boost to its numbers, but New Jersey gets tourists, too and size matters. Nevada’s population of fewer than 3 million was inevitably going to lose its crown to New Jersey’s nearly 9 million.
#6: States launching online sports betting
There was a wonderfully steady drip of announcements throughout 2019 of new states launching their online sports betting offerings. Although each could make a top 10 story of their own, to summarize:
- Pennsylvania: The first mobile app went live from SugarHouse Sportsbook PA in May. BetRivers, Parx and FanDuel Sportsbook PA all went live in the next two months.
- Indiana: Oct. 3 was the go-live date for DraftKings and BetRivers. Indiana deserves a special mention for the speed with which it went from legislation to launch.
- Iowa: The first sportsbooks in the state went live in August 2019. Unusually, Iowa managed to get retail and online sports betting live at the same time. Unfortunately, for the first 18 months of operation, you can only sign up for an online account by going to a casino.
- West Virginia: WV briefly had online sports betting in late 2018. A contractual dispute took BetLucky offline, but just in time for the start of the NFL season, FanDuel Sportsbook and DraftKings launched.
- Rhode Island: In March, Gov. Gina Raimondo filled a gap in the sports betting legislation by signing a new law to allow mobile sports betting. The first online bets using the William Hill platform were placed in the fall.
- Oregon: Straight from the state lottery, the Scoreboard app went live in October.
#7: States legalizing sports betting
While states with legal sports betting were getting the product into the market, several states passed laws but didn’t launch by the end of the year.
These states include Illinois, Montana, New Hampshire, North Carolina and Tennessee. Arkansas voters approved legal sports betting in a referendum and started in July 2019. Sadly, they will only allow mobile sports betting inside a casino, just like Mississippi.
Michigan half passed sports betting legislation, getting a majority in the House, but no further progress in the Senate, so far.
Maine is in the same position. There is a bill passed, but action is still required in early 2020.
New York played with adding online sports betting to its existing sports betting laws but failed to resolve the bickering between Republicans and Democrats that is making cross-party cooperation all but impossible.
Finally, Colorado voters approved sports betting legislation via referendum with launches expected in early 2020.
Despite the hiccups, it was an excellent year for online sports betting, setting the stage for a lot of new launches in 2020.
#8: The merger of Flutter and The Stars Group
In choosing which stories should make the top 10, it’s easy to go for the ones that got the most views during the year. The merger of the Flutter Group and The Stars Group was not table talk in houses throughout the land. And, it didn’t get lots of views from outside the industry.
But it will probably have a much more significant impact on US gambling than most events of the year.
Flutter, previously known as Paddy Power Betfair, was already a gaming behemoth after its two big-name brands merged in 2015. The Stars Group became a serious gaming player when it joined with Sky Betting and Gaming in 2018.
The two rivals’ corporate marriage will create the largest iGaming group in the world. And, it’s not even close.
Both companies are active in the US iGaming space and this merger could put them on track to be the largest player in US sports betting within a few years.
#9: Online poker launches in Pennsylvania
PokerStars Pennsylvania launched on Nov. 4, a little later than hoped. I’m not talking about how long it took Pennsylvania regulators to approve them, and I’m not talking about how long it took them to get their act together to partner with Mount Airy Casino.
No, online poker launched in New Jersey in November 2013, a little while later than Nevada and Delaware. Since then, no other states have had regulated online poker until now.
Back then, there was an expectation that other states would quickly jump on the iGaming revenue bandwagon, but nobody did.
It took a Supreme Court judgment to get state-regulated sports betting legalized, and another year and a half before the first state launched online poker. That’s six years later than expected.
Even now, the states that are legalizing sports betting seem to have a blind spot when it comes to poker. Sure, sports betting tax revenues are massive compared to poker, but why not play tag-a-long?
The idea that sports betting is more skillful than poker, or less likely to lead to problem gambling is obvious nonsense. There is simply no rational reason to allow online sports betting and deny online poker.
Thank you, Pennsylvania. On this, you have achieved a level of sanity denied to your peers. On the other hand, your 36% tax on sports betting.
#10: The dog that didn’t bark
The biggest story of the year is the one that didn’t happen. After 18 months of legal sports betting in various states, there was no big, bad news story.
No regulated sports betting provider went bankrupt, leaving customers without access to their funds. No significant sports betting cheating scandals affected the industry deeply. No casinos closed because they couldn’t compete with online gaming. No research reports suggested that the introduction of state-regulated sports betting and online gaming was creating an epidemic of online gambling.
In fact, all the dire predictions of the opponents of online gambling and legal sports betting have, so far, proved unfounded.
Of course, in human affairs, anything that can go wrong will. There will be regulatory failures, corporate failures and sheer human malice. But all of these things can be dealt with inside a legally regulated system.
Finally, US gamblers are being allowed in out of the cold. And that is seasonal good news of the best sort.