Now that sports betting is legal in one-fifth of US states, the big sports leagues are rapidly taking steps to get the benefits. The NBA, NHL and MLB all have official sports betting partners. The NFL is the most popular sport for betting, but so far it is sitting on the fence. But why is the NFL holding out?
There are real benefits in partnering with a big sports betting operator, not least the additional revenues. However, the biggest benefits are in helping NFL fans transition to being NFL bettors safely and successfully.
NFL fans are turning into NFL bettors
The American Gaming Association (AGA) published research that estimates the NFL could earn over $2.3 billion annually by 2020. The revenue uplift will come from the result of increased fan engagement created by legal sports betting.
In a separate piece of research published before the Supreme Court overturned the Professional and Amateur Sports Protection Act (PASPA) last May, the AGA estimated how many NFL fans would start sports betting if it was legal.
The AGA found that the percentage of fans betting on NFL games would rise from 19% to 31%.
In its most recent survey, published in September, the AGA found that this figure was conservative, and that “15% of American adults (38.1 million) say they will bet on the NFL this season.”
Research on the European market has consistently found that a large proportion of online gamblers don’t know if their betting site is legally regulated or not. And a sizable percentage of those believe that their operator is legally regulated when it isn’t.
The danger is that many Americans will hear about the legalization of sports betting and think that it means the offshore site they currently use is now legal. Or, when searching for a sports betting site, they will find an offshore site and assume it is legal.
The regulators can’t defeat this misunderstanding alone. The NHL, MLB and NBA have all recognized that they have a responsibility for helping their fans make the transition to sports bettors.
The NFL should step up to the plate and recognize that putting its imprimatur on one or more legal brands is the minimum it must do to guide fans in the right direction.
NBA, NHL and the MLB have embraced sports betting
The other big leagues, the NHL, NBA and MLB have already established official sports betting partners.
Current partnerships are:
- NBA—William Hill, MGM Resorts, FanDuel and Fox Bet
- NHL—FanDuel, MGM, William Hill, and SportRadar
- MLB—MGM, DraftKings, FoxBet and Fanduel
NHL Commissioner Gary Bettman commented after agreeing on the deal with William Hill:
“What we’ve learned is that (sports gambling) is another point of engagement for the fans. Ultimately, I think if you’re interested in sports betting, you’re going to have an increased opportunity to engage with the game. If you’re not interested, it shouldn’t impact the way you consume the game. And if you’re a sports fan who may not necessarily be a hockey fan, it will give you an opportunity, potentially, to sample something new.”
Post the Will Hill Deal with the NBA, Dan Shapiro, vice president of strategy & business development of William Hill, US said:
“We are proud of this creative partnership that benefits our customers and our partners nationwide while promoting legalized wagering on NBA events. The NBA has been a leader in recognizing the benefits of a legal sports betting market.”
The deal PR significantly added:
“Throughout the partnership, William Hill and the NBA will collaborate on best-in-class practices to protect the integrity of NBA games.
Selecting a sports betting partner is about more than the extra revenue. It’s about more than just extra engagement, it is a responsible approach to managing the wider responsibility legal sports betting brings.
This wider responsibility includes protecting game integrity and channeling fans away from illegal offshore sites towards the newly legal sports betting sites.
The NFL thinks the US market is too immature for a sports betting partnership
Apparently the NFL is not averse to sports betting partnerships in principle. In September, the NFL agreed a deal with Australian sports betting giant TabCorp.
NFL spokesperson Brian McCarthy told Gambling.com:
“The Australian marketplace is much more mature than here in the U.S. where the league is not pursuing a partnership with a wagering partner.”
The NFL does have a US casino partner, Caesars Entertainment. It also has the equivalent in Canada with Gateway Casinos & Entertainment, which operates a dozen casinos in Alberta and British Columbia.
The NFL changed its rules in August last year to allow teams to create relationships with casinos but still forbids them from making sports betting deals.
One NFL team, the Dallas Cowboys, has struck a casino deal with the WinStar World Casino and Resort in Oklahoma. Oklahoma does not yet have legal sports betting so the issue doesn’t arise.
Nevertheless, the new rules state that any casino involved in an arrangement like the Cowboys’ deal will still be prohibited from directly advertising its associated sportsbook.
Where the NFL has moved in the right direction is in fantasy sports. In September the league announced a partnership with DraftKings. The deal is strictly restricted to Daily Fantasy Sports (DFS).
The deal announcement included a statement from DraftKings CEO Jason Robins:
“Throughout our discussions with the League, it was evident we share a common vision around the future of fan engagement, and we are excited to continue on this unique journey with the NFL as our ‘Official Daily Fantasy Partner.’”
So, the NFL has gotten the message about increased fan engagement. Will it also realize that as sports betting is beginning a massive US roll out, now is the time to partner up?
If the NFL does establish a sports betting partnership, who is in the frame?
Assuming the NFL does change its stance, it will have several potential partners to choose from.
The existing relationship with Caesars has plenty of scope for exploitation. Caesars is developing a serious sports betting presence in the states where it is now legal. Caesars is also merging with Eldorado Resorts, greatly expanding the reach of the two companies.
That makes Caesars much more attractive to the NFL which prizes its US-wide audience. Between them, Caesars and Eldorado also have deals with FoxBet, William Hill, Scientific Games and 888. Early in 2019, Caesars also partnered with DraftKings, picking up a small ownership stake on the way.
It might be significant that New England Patriots owner Robert Kraft and Dallas Cowboys owner Jerry Jones both have investments in DraftKings.
Caesars is also a founding partner of the Las Vegas Stadium where the Raiders play their home games.
Any partnership deal the NFL strikes that excludes Caesars would be something of a slap in the face.
The enthusiasm of MGM for such a deal is evidenced by its deals with the other three big leagues. MGM is partnered with GVC for its online gaming, and clearly wants to get a deal with the NFL.
Any other potential partners are almost entirely likely to be eclipsed by Caesars and MGM. Separate but lesser deals may be struck, but MGM and Caesars are by far the two most likely partners.
The one third party player in this corporate game is SportRadar. It provides sports data for sports betting operators. The NFL is the most popular sports for sports betting, so any deepening of their existing relationship with the NFL would be desirable.
What are the benefits of a sports betting deal?
The AGA based its forecast of an extra $2.3 billion a year for the league on the NFL making the most of the sports betting opportunity. Official partners are an important part of this. Without an official partner, the NFL is leaving money on the table.
NFL team owners are all billionaires. NFL rules do not allow corporations to own teams. Even individuals or groups of individuals who want to own a team must be approved by the league.
Squeezing every last dollar and cent out of team ownership is not necessarily the first priority of team owners. However, they are united in wanting what’s best for the league, for the teams and for the fans.
One or more official partners brings the NFL considerable benefits over and above the financial:
- Greater fan engagement
- Higher TV viewing figures
- Opportunities to ensure game integrity and additional protection for the athletes
- The chance to divert sports bettors from an unsafe illegal online betting environment to a legal controlled one
In delaying the selection of sports betting partners, it feels like the NFL is continuing its gut opposition to sports betting per se.
The NFL opposed legal sports betting for years. It is time it accepted the reality of the situation and delivered on its obligations to the fans.