GUIDE TO BY
WH AT I S
Sports Leagues Have "A Lot of Gall" Solving A Problem Like the Wire Act
Gaming's Fight for Gender Equality
INTERVIEWS WITH BETCONSTRUCT, AGA, CAESARS & MUCH MORE
Andrew McCarron Managing Director SBC - Sports Betting Community
CONTENTS OCTOBER 2018
elcome to our Sports Betting Guide to G2E! This time last year, such a publication would probably have been described as a folly, but since the Supreme Court repealed PASPA, the US has been transformed into a land of opportunity. As with our Sports Betting Guide to ICE, this magazine is designed to highlight some of the key areas at G2E for those of us interested in learning more about the exciting world of sports betting. We’ve also included some articles that we’ve been running across our news sites - www.SBCAmericas.com, www.CasinoBeats.com and www.SBCNews.co.uk. The iGaming Zone is the obvious hub of G2E for betting and it would be worthwhile visiting Golden Race (4418), Betinvest (4618), BetConstruct (4818), Kambi (5320) and Digitain (4823). However, there are betting firms dotted around the show as well. Optima (2818), Sportradar (4023), SB Tech (4211) and Betgenius (3841) to name a few. Even as we went to press, G2E added two more seminar session to the agenda: “Official Versus Unofficial Sports Betting Data: The Attractions and the Issues” and “The Challenges of Being a Sports Betting Operator in the U.S.” Despite the huge increase in interest, it’s not as if betting wasn’t happening already of course. US racetracks have long had a good reputation for the sport they provide, while the Vegas sportsbooks are among the biggest and most intimidating betting outlets in the world. The elephant in the room is that citizens all over the country have long been betting anyway, whether it’s illegal or not, and the sheer size of the illegal betting market should be enough for any state legislature to justify introducing sports betting regulators to bring that activity into the light. If there’s one thing America knows, it’s that prohibition doesn’t work. But again, that’s what is so exciting about the market at the moment - it can go in any direction. The only problem with that is that it’s very easy to get sports betting wrong and it can cost a lot of money, as well as a lot of wasted time and effort rectifying things. This is why SBC runs its Betting on Sports Conferences, and is bringing one to New York next April. We will be bringing together some of the world’s foremost betting experts to share how they operate their businesses in the hope that it will inspire attendees to make the most out of the opportunity that has presented itself to the country. Check it out at www.sbcevents.com - it will be worth your while. In the meantime, let’s have a great G2E!
4 G2E’s sports betting seminar sessions 16 BetConstruct’s view on seamless sports betting provision 19 INTERVIEW: AGA’s Casey Clark 23 William Hill’s new pledge: “Nobody harmed by gambling” 26 What is Betting on Sports America? 29 Feisty exchange at integrity fee debate 32 Jan Jones - pushing back the boundaries 37 Sports betting moves into the light 41 Where to go on the Wire Act? 42 Oddslife: the tool to attract players before legislation 46 Geofencing - the key to state regulation 48 Italy’s cruel summer 51 Risk management from FSB 54 Final Word: Sportradar’s Prof. Dr. Laila Mintas
The SBC Sports Betting Guide to G2E is brought to you by SBC - Sports Betting Community: EDITORIAL TEAM: Andrew McCarron, Luke Massey, Craig Davies, Michael Lawson, Ted Menmuir, Joe Streeter, Chris Murphy, Stewart Darkin SALES TEAM: Rasmus Sojmark, Alyona Gromova, Conall McCabe, Neil Judson, Pras Sri DESIGNED & DELIVERED BY Better Mags (bettermags.co.uk) All material is strictly copyrighted and all rights are reserved. No part of this publication may be reproduced in whole or in part without the written permission of Sports Betting Community Ltd. Although every effort has been made to ensure the accuracy of the information contained in this publication, Sports Betting Community Ltd cannot be held responsible for any errors it may contain. Sports Betting Community Ltd cannot be held responsible for the loss or damage of any material, solicited or unsolicited. The views in the publication are not necessarily the views of Sports Betting Community Ltd or those of the advertisers. Produced and published by Sports Betting Community Ltd REGISTERED ADDRESS: Sports Betting Community, 103-105 Brighton Road, Coulsdon, Surrey CR5 2NG, UK TEL.: +44 (0) 161 367 1250 EMAIL: email@example.com WEB: www.sbcgaming.com
PASPA IN FOCUS
INSPECTING THE FINE PRINT
PASPA repeal could well prove to be the most
significant development in the history of sports betting in the US, but what effects will it have on the industry and beyond?
t’s late afternoon on Monday 14th May 2018, and a grueling 19-month US Supreme Court case has just reached its conclusion. The state of New Jersey, represented by Governor Phil Murphy, has succeeded in overturning the Professional and Amateur Sports Protection Act (PASPA), paving the way for state-sponsored sports betting across the country. Perhaps the most consequential element of the Supreme Court opinion was that the entire law, and not just PASPA’s bans on authorising and licensing sports betting, was deemed unconstitutional. The American Gaming Association (AGA)
explained in the aftermath of the decision: “This is a sweeping victory for New Jersey, and by extension for the gaming industry in all states. While the Court had ways to decide the case narrowly, the Court chose to strike down the entire law. “The opinion makes clear that, unless Congress acts to prohibit sports betting directly (which it is unlikely to do), states are now free to decide for themselves to
legalise (or not) sports betting. “And because the opinion struck down the law in its entirety, states will be able to directly license and regulate operators; states will not be limited to the partial repeal and indirect regulation that New Jersey was forced to employ.” States have wasted no time in opening up to sports betting, and in the fivemonth period since PASPA was struck down, four (New Jersey, Delaware, Mississippi and West Virginia) joined Nevada in approving such wagering. Meanwhile some commentators have argued that the impact of the Supreme Court decision could have repercussions far beyond the sports betting world. They believe its ruling will impact other current federal laws in place
SCOTUS Decision: What the Ruling Actually Said and What it Means TUESDAY 9TH OCTOBER, 10:15 TO 11:15 AM SPECIAL EVENTS STAGE
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that could be considered to have commandeered power from the states, such as gun ownership rights, immigration enforcement (eg. penalising sanctuary cities), and the legalisation of marijuana under state law. Jonathon Cohn, a former Deputy Assistant Attorney General at the Department of Justice, has argued cases in the Supreme Court, the federal courts of appeals, federal district courts and numerous state appellate and trial courts. Speaking at the forthcoming G2E Expo, he will examine the complexities of the Court’s decision and what it means for gaming, sports and beyond. On a panel entitled ‘SCOTUS Decision: What the ruling actually said and what it means’, Cohn will be flanked by AGA Senior Vice President of Public Affairs Sara Slane, and Aurene Martin, President of Spirit Rock Consulting and a member of the Bad River Band of Lake Superior Chippewa. Martin has extensive experience in Federal Indian law and policy, having served in both Tribal government as in-house counsel and in the Federal government, and will assess what the Supreme Court decision means for the prominent tribal betting sector. No matter how much PASPA’s repeal is talked up or downplayed, it’s clear that its impact will be felt across every facet of the industry. This panel will spell out exactly what this means for all involved. •
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US SPORTS BETTING: THE STATES AND TRIBES CONUNDRUM WITH EXCLUSIVITY
compacts disrupting certain jurisdictions, how can states and tribes work together in the on-going roll-out of sports betting across the United States?
ay’s decision to overthrow the Professional and Amateur Sports Protection Act 1992 (PASPA) was welcomed by many industry stakeholders, with the ensuing scramble in an attempt to obtain early frontrunning emphasising its importance, and potential long-term impacts. As state-by-state regulation is rolled out in various jurisdictions across the United States though, one key relationship across many could perhaps hold the key to how success will look. Indian tribes can hold significant influence within many of the US states, and despite initially opposing sports betting, came out in its support prior to the Supreme Court’s ruling. With almost 250 tribes conducting
gaming operations across the country, and doing so in some 29 states, the $32bn industry is in a state of continuous growth, so much so that has seen it occupy in the region of 40-50 per cent of the nation’s entire industry. Despite some cases seeing states, and tribal sovereign nations, prepare for a favourable ruling by introducing legislation for the permittance of sports wagering, certain exclusivity clauses in other instances muddy the water somewhat. Something explained by Debbie Thundercloud, chief of staff at the National Indian Gaming Association, who commented: “The Indian Gaming Regulatory Act requires that tribes and
states enter into contracts that outline how gaming is going to be conducted, how it is going to be regulated, for those class three style games. “And those terms and conditions of how the contracts vary for each of those tribes, so each of the 248 tribes have gaming may have different nuances and terms and conditions within those contracts. “Some of those contracts may be exclusivity clauses, so that’s where it complicates how sports betting might get rolled out in the United States within tribal gaming, because those tribes have exclusive jurisdiction within those states to have gaming, and there may be commercial forces that want to participate in that, but because of those exclusivity clauses it makes the political dynamics a little bit different.” The protection of such exclusivity clauses has been one particular area of discussion, something Eilers & Krejcik elaborated on: “Many are wary of states
How States and Tribes Are Preparing for Legal Sports Betting TUESDAY 9TH OCTOBER, 1:15 TO 2:15 PM SPECIAL EVENTS STAGE
6 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
using sports betting as a way to erode tribal exclusivity, or to reopen lucrative gaming compacts for renegotiation. “In a number of major markets, primarily to the west of the Mississippi, tribes are the dominant gambling stakeholder. Without a clear path toward sports betting policy that resolves their concerns and offers a compelling financial opportunity, it’s difficult to see why tribes would let sports betting through.” Addressing the state and tribe relationship within Oklahoma, Matthew
Morgan, director of gaming affairs at the Chickasaw Nation, made a point that could strike relevance across several states: “Why do we want to continue to send the revenue somewhere else? The tribal interests and state interests are intertwined. As (we) do better, the (state) does better,” he said. ‘How states and tribes are preparing for legal sports betting’ forms part of the new Sports Betting Symposium track at this year’s Global Gaming Expo (8-11 October). Joining Morgan is Susan Hensel, Director of Licensing Pennsylvania Gaming Control Board, David Rebuck, Director of the New Jersey Division of Gaming Enforcement, and moderator Chris Cylke, Vice President of Government Relations at the American Gaming Association. •
THE SPRAWLING WEB OF US SPORTS BETTING WITH SPORTS BETTING exploding
into action in the United States, certain partnerships have begun to provide a brief insight into the huge possibilities lying ahead
he sports betting scene across the United States is almost in a constant state of flux, as the jockeying for position continues apace across the plethora of stakeholders eagerly participating, or keenly observing from afar. ‘Overview: The business of sports betting,’ taking place on Wednesday October 10 (10:15 - 11:15), is just one of the many sessions set to be held as part of the ‘Sports Betting Symposium’ track at this year’s Global Gaming Expo (G2E).
Moderated by ESPN SportsCenter Anchor Scott Van Pelt, the session contains
speakers such as Major League Baseball’s Executive Vice President of Gaming and New Business Ventures Kenny Gersh and Stephen Master, Managing Director of Americas and Commercial Director for Nielsen Esports and Nielsen Sports. Rounding off the panel is Sara Slane, Senior Vice President of Public Affairs at the American Gaming Association, who analysed the US’ sports betting scene, and the importance of the G2E symposium. Earlier this year, she said: “In the three months since the Supreme Court’s ruling to overturn the federal ban on sports betting, there has been substantial movement in the states to create legal, regulated sports betting
markets. “Three states have already begun offering in-person, single-game sports betting, including online in New Jersey, and a handful more states are expected to follow suit in the coming months. “As states and sovereign tribal nations consider whether to introduce regulated sports betting within their jurisdictions, the Sports Betting Symposium at G2E will serve as a resource for the gaming industry to learn more about navigating the business, legislative and technological matters surrounding the legalisation of sports betting.” The seven-year fight by New Jersey to finally see PASPA repealed, during which it ensured a torrid 0-7 win loss record at federal level, saw a it faced with a strict hardline stance from the US’ varying sports leagues and organisations. No longer is that the case, with a number of deals negotiated pointing to the fact that sports betting across the United States is a business whose web
Overview: The Business of Sports Betting WEDNESDAY 10TH OCTOBER, 10:15 TO 11:15 AM SPECIAL EVENTS STAGE
8 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
will reach far beyond a mere member of the public placing a wager. The first glint of these possibilities came a little over two months after that Supreme Court decision, when MGM Resorts International and the National Basketball Association come to terms on a “historic alliance”, seeing the first gaming partnership for one of the USA’s major sports leagues. In a period of firsts, the Choctaw Indians became the inaugural tribe to offer sports betting outside of Nevada, with its Pearl River Resort the lucky recipient. This came before the Chickasaw Nation provided a further insight into the vast potential of the business, with its WinStar World Casino, whose Oklahoma home doesn’t permit sports wagering (at the time of print), striking a deal with the Dallas Cowboys and with its being the first to take advantage of a relaxation of rules by league owners, forbidding such entity’s occupying such partnerships. It’s still very early days but slight glimpses into the huge sums at stake have been captured. What these figures are is anyone’s guess, but if the American Gaming Association’s $2.3bn NFL revenue boost prediction is anything to go by, the ensuing scramble could have some way to go. •
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NJ SUPPLIER RACE
FINDING THE RIGHT PARTNER: THE ONGOING BATTLE FOR SPORTSBOOK CONTRACTS SBC assesses the early
movers and shakers in the New Jersey market, as Kambi lays down a marker for online sports betting services in the Garden State
ambi took the early lead in the ‘supplier race’ for online sports betting in New Jersey (NJ) this summer, but the ensuing fight for supremacy in the Garden State is just the start of an ongoing battle for tech-based contracts across the country. ‘Finding the right partner’ is one of the sessions held as part of the ‘Sports Betting Symposium’ track at the Global Gaming Expo (G2E), presented by the American Gaming Association (AGA) from 8-11 October. Held on 10 October, it will feature Alen Lang, Director of Coloring Up Limited, alongside Jonathan Michaels, Senior Director of Member Services at the AGA.
Kambi’s status as the ‘early movers’ in
the NJ market was confirmed after Rush Street Interactive (RSI) added a Kambi sportsbook to the popular PlaySugarHouse. com gaming site in late August, featuring wagering options such as singles, parlays, props and futures. This meant that just three weeks after making history by facilitating the first online wager in the post-PASPA market through DraftKings, taken on Wednesday 1 August, Kambi was responsible for two of the state’s first three live sportsbooks. Kristian Nylén, Kambi Chief Executive, said at the time: “In what is another major milestone for Kambi, I am delighted we have been able to assist Rush Street
Interactive in becoming one of the early movers in the online wagering market in New Jersey. “To be providing our Sportsbook to two of the three online operators currently live in New Jersey is a great achievement and provides further evidence that Kambi is the trusted sports betting partner for operators wishing to enter regulated markets.” However, just another week on and the count was already at five, as both FanDuel, developed in partnership with IGT and new owner Paddy Power Betfair, and William Hill beat the race to launch mobile sports betting in time for the new NFL season. Speaking at the time of the PlaySugarHouse launch, Kambi had already teased the launch of a third
Finding The Right Partner: An Interactive Exhibit Hall Tour WEDNESDAY 10TH OCTOBER, 1:15 - 2:15 PM VENETIAN BALLROOM G
10 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
sportsbook in the state, most likely through the Unibet brand, facilitated by a five-year agreement between Hard Rock Casino and Kindred Group. The complexities of this supplier race was emphasised by Kindred Group partnering with SG Digital, the online division of Scientific Games, to utilise the firm’s player account management platform (OPS) and game aggregation technology (OGS). Meanwhile, Scientific Games has also subsequently rolled out its own online and mobile sportsbook in NJ through a partnership with Caesars Casino, who will work SG Digital’s OpenBet sportsbook technology. As the state which brought the lawsuit that led to the repeal of PASPA in May, NJ has unsurprisingly taken the lead for online betting amongst newly legalised states. However, this battle amongst tech partners will only be replicated across the likes of Pennsylvania and West Virginia all of this will of course be considered this week. •
TAX AND TRANSPARENCY
STATE UNITY IS PIVOTAL TO SECURING INTEGRITY KHALID ALI, SECRETARY GENERAL OF ESSA, spoke to
SBC about what the regulated American market can learn from Europe when it comes to integrity
s the US sports betting market opens up, putting measures in place that increase integrity undoubtedly remains a foremost priority for everyone involved. Khalid Ali, secretary general of ESSA, the international sports betting integrity association, spoke to SBC about what he believes the US can learn from the regulated European markets when it comes to regulations as states open up.
Highlighting how an operator’s US strategy will be similar to that undertaken in Europe, Ali detailed: “There’s no such thing as a US framework; each framework will be implemented state by state. Effectively we will have 50 states that will open up to sports betting, with each framework specific to that state’s characteristics. “This is something that we have seen in Europe, where operators have been calling for a single European regulatory framework for quite some time. That’s never emerged; every country has opened up their market in their own way, which is very challenging if you’re an operator. “As then you’re having to duplicate a lot of your efforts, in terms of set-up compliance and legal standards, this can be very costly and time consuming. Unfortunately in the US we will probably go through a very similar process.” He also pointed to Europe to explain
why US states need to get their strategies correct, emphasising that a regulated, correctly taxed gambling market can be “hugely beneficial” for all parties. “There’s a right way of doing it and there’s a wrong way of doing it,” he continued. “What it really comes down to is taxation, what are the right levels of tax and whether it will be done through
How Sports Betting Works in a Regulated Market THURSDAY 11TH OCTOBER, 10:15 - 11:15 AM SPECIAL EVENTS STAGE
12 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
turnover or through gross gaming revenue - because both have very different consequences. “For example, what we have seen in Denmark with a 20 per cent GGR range and in the UK with a 15 per cent GGR range, rates of consumer channeling are at 90 to 95 per cent, which is very good. “However, in regions where turnover is being used, then you’ll see that channeling rates are totally different. In Poland, where they have 12 per cent turnover in tax, it’s estimated that only 30 per cent of its consumer liquidity is channeled to its operators. “By contrast, in France, where turnover tax is at 9.3 per cent, around 60 per cent is channeled through its licensed betting operators in that market. It’s really important that the taxation levels are right. “If only 60 per cent of your consumers are betting with licensed operators, that means there’s another 40 per cent going into other markets, which may not be transparent as they don’t have visibility; you don’t know what they’re betting on, and that’s a concern. “So obviously a lower rate of taxation, based on GGR so that we have a much more open transparent market, will work better for everyone.” Ali will be speaking at this week’s G2E conference on the panel entitled: ‘How Sports Betting Works In a Regulated Market’. The session will analyse how operators, suppliers, consumers and other stakeholders benefit from regulation and oversight that protects contests, participants and gaming providers, enabling a popular, safe form of entertainment. •
EARLY ADOPTERS SEEK ON-PROPERTY AND REMOTE BASED INNOVATION A CRUCIAL FACTOR in embracing the introduction
of US sports betting is creating an environment in which innovation thrives, something not lost on those first to market
hen Delaware’s governor John Carney placed the first legal sports wager outside of Nevada at Dover Downs Race and Sportsbook on 5 June 2018, there was an air of inevitability that it would usher in a period of rapid progression for US sports betting. Perhaps what’s most intriguing about the emergence of the US market is the speed at which the early adopting states have embraced mobile betting, with many constructing strategies to follow in the footsteps of New Jersey. This fast paced progression shows that the early adopters aren’t resting on their laurels. In just the first month of trading, the state of New Jersey recorded a total of $16.6m in wagers. That was despite the initial sports betting launch coming to just two on-site locations, Monmouth Park Racetrack and the Borgata, on 14 June, before being joined by Ocean Resort Casino on 28 June.
go live in Mississippi, West Virginia and elsewhere, subject to regulatory approval. There is a lot happening and we are very proud of our team.” That being said, mobile betting isn’t the sole source of innovation in states that have progressed with regulating sports betting. With the launch of SBTech’s on-property solution, New Jersey and Mississippi both dramatically evolved the non-remote gambling experience in their states. These nascent partnerships allowed selected operators in the states to offer unique and differentiated pricing for all US
U.S. Sports Betting: Lessons Learned from Early Adopters THURSDAY 11TH OCTOBER, 1:15 TO 2:15 PM SPECIAL EVENTS STAGE
Building on an immensely positive launch,
the state and its operators have already set out on the path to enriching the sports betting experience in New Jersey, with DraftKings, who took the inaugural online bet, being joined by the likes of William Hill and FanDuel. From the outset, William Hill made innovation a foremost priority. In advance of launching its mobile offering in New Jersey, the firm’s US CEO Joe Asher stated: “We have had a great start in New Jersey and our team is working hard to launch our mobile product there, as well as getting ready to
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sports events, in addition to tailored trading strategies, non-pooled risk management and advanced automation. Resorts Casino CEO Mark Giannantonio detailed the importance of creating the most enjoyable environment possible for US bettors: He said: “Resorts is very excited about the start of the football season as we have created an amazing destination experience for our customers to come to Atlantic City and enjoy a full slate of NCAA and NFL football markets to bet on. Our goal is to establish Resorts as the home for New Jersey players who want to enjoy the best gaming experience with access to the latest sports betting technology, including our state-of-the-art self-service betting kiosks.”
A diverse breakdown of the successes that the early adopting states have enjoyed will close the conference at G2E’s Sports Betting Symposium. It will feature Asher alongside SBTech CEO Richard Carter; the Vice President of Sports Betting at IGT PlayDigital Charles Cohen, and Joe Pappano, Senior Vice President and Managing Director of Vantiv Gaming Solutions. The panel will also outline the challenges and lessons for those jurisdictions still considering sports betting in the US, as well as mapping out the lessons to be learned from those states that have been keen to embrace sports betting. •
THE CHALLENGE OF SUPPLYING SEAMLESS SPORTS BETTING ACROSS THE US JONATHAN AIWAZIAN,
Regional Director for USA at BetConstruct, spoke to SBC about sports betting growth, educating the population about in-game betting, and the challenge to negate cross-state confusion Four months after PASPA repeal, what is the industry seeing in terms of initial US sports betting propositions?
- The growth in New Jersey in the early days has been very exciting. In June, there was roughly $1 million dollars in handle per day, with only a few NBA games and no NFL matchups. This number swelled to $1.3 million in July with zero NBA and still no NFL games. It will be great to see how the numbers grow in September after the NFL has been in full swing for almost a full month. The US market is showing that it is indeed as big a market as everyone imagined it would be.
“AS A RESULT OF NOT BEING EXPOSED TO UP-TO-THE-SECOND DATA FEEDS AND LIVE STREAMING OF ALL MATCHES, US BETTORS ARE NOT FAMILIAR WITH THE CONCEPT OF BETTING ON THE OUTCOME OF THE NEXT PLAY.”
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What is the biggest technological challenge that awaits all new market incumbents?
- Educating the population on the logistics of in-game betting that has become the majority of sports bets in other countries will be the main goal of most operators in the beginning months of sports betting in the US. As a result of not being exposed to up-to-the-second data feeds and live streaming of all matches, US bettors are not familiar with the concept of betting on the outcome of the next play. The closest experience has been to play the second half lines in basketball or football, which does not compare to the almost unlimited betting opportunities that exist in modern online sportsbooks overseas. Whichever operators do the best job of introducing their customers to the live betting arena will be able to capture the biggest percentage of the market. Operating within the current limitations, can stakeholders really deliver engaging and value added betting products to US sports consumers?
- US stakeholders have the opportunity to work with the regulators to formulate the laws before they are on the books. New
Jersey regulators in particular have shown a keen willingness to listen to new ideas from operators and other industry experts, allowing for innovation within the bounds of the laws. The key will be for other states to also work with industry experts to craft the most flexible laws and regulations that will not stifle innovation and create new and exciting products that even European markets have not thought of yet.
“WHICHEVER OPERATORS DO THE BEST JOB OF INTRODUCING THEIR CUSTOMERS TO THE LIVE BETTING ARENA WILL BE ABLE TO CAPTURE THE BIGGEST PERCENTAGE OF THE MARKET.” Have you seen a gap in current US betting provisions that you can exploit?
- In the beginning months of sports betting, the focus should be on working with regulators and lawmakers in a realtime basis to tell them what is working and what is not working. So far, regulators have been quick to respond. Everyone
is very excited that this large market is finally open, but the key to long term success is to let the market evolve over time. How will the US betting market compare with other regulated markets; what will be the key difference between the US and the rest of the world?
- The state by state regulations could cause confusion among the betting population, with the US market acting like 50 different markets. It will be a challenge to educate users about the different guidelines and tax rates in each state, especially for people who live and work near state borders. For example, many New Jersey residents work in New York City. While at home they are able to legally bet on sports, but while at work, they would be blocked by geolocation companies from accessing their accounts. When New York eventually legalizes sports betting, the user will have to have two separate accounts with two separate wallets and won’t be able to transfer between them. There are many issues that need to be resolved before the US market has seamless betting. •
AGA HAS ITS SAY ON THE PAST, PRESENT AND FUTURE
OF SPORTS BETTING IN THE US SBC TALKED WITH CASEY CLARK, vice
president of strategic communications for the American Gaming Association, about some of the burning issues of the day arising from the legalisation of sports betting in America
CLARK sbcmagazine.com 19
EXCLUSIVE INTERVIEW CASEY CLARK
What were the AGA’s key arguments for legalizing sports betting prior to the repeal of PASPA? - Before the Supreme Court decision in May, AGA was primarily focused on spotlighting the thriving illegal sports betting market, the role that PASPA played in enabling that market and the benefits that could be realized by lifting this unconstitutional restriction. Americans were wagering at least $150 billion illegally on sports in this country every year – the only thing PASPA succeeded in doing is eliminating the protections of a regulated market and the benefits it provides. The Court decision enabled states and sovereign tribal nations to decide what works best for their constituents, and those that decide to bring legal, regulated sports betting to their jurisdictions will realize significant economic benefits, increased consumer protections and more stringent focus on bet and game integrity now that it is above board. The SCOTUS ruling was a resounding one. Was the AGA surprised at the clarity of the final outcome given that there had been speculation that a repeal would be partial at best?
- We were prepared for each possible outcome, but certainly pleased with the Court’s decision. A partial ruling would have created even more confusion and an urgent need for federal government intervention to fix a problem largely perpetuated by unconstitutional federal government intervention. States and sovereign tribal nations have proven effective regulators of gaming for decades and will continue to do so with the continued expansion of legal, regulated sports wagering.
“BRINGING SPORTS BETTING OUT OF THE SHADOWS AND UNDER THE PROTECTION OF THOUSANDS OF GAMING REGULATORS CAN ONLY ENHANCE THE INTEGRITY OF BOTH THE BET AND THE COMPETITION.” With increased opportunities to bet/ gamble comes the inevitable risk of more problem gamblers. What is the AGA doing to promote responsible gambling and what should operators be doing to minimize harm?
- Responsible Gaming is more than a pledge, it’s a priority for gaming companies across the country. Each year, the industry commits more than $300 million to support responsible gaming education,
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training and treatment programs across the country. As the industry continues to evolve, operators and suppliers remain committed to promoting a safe gaming environment for patrons and industry employees. This year, AGA updated its Code of Conduct for responsible gaming to include wagers on sports, as well as new advertising provisions to ensure casino and sports betting marketing is conducted responsibly. What’s the association’s take on integrity in sport and is the concept of an integrity fee realistic?
- Nobody has a greater interest in preserving the integrity of sports than sportsbook operators who stand to lose, literally, if there’s any sense of impropriety. It is why gaming operators in mature, legal sports betting markets have robust partnerships with sport stakeholders and regulators, sharing information in real time, and stopping suspicious behavior before it affects competition. This process exists and is performing well in these markets (internationally and here in the U.S. in Nevada) through commercial contracts that enable aboveboard gaming to take place without any risk to the spirit of competition. Bringing sports betting out of the shadows and under the protection of thousands of gaming regulators can only enhance the integrity of both the bet and the competition. There is no need or legal precedent for statute that mandates the transfer of revenue from one heavily regulated, private industry (gaming operators) to a largely unregulated one (sporting bodies).
The integrity fee concept has fallen flat in every state that has legalized sports betting since the SCOTUS ruling, and the AGA continues to adamantly oppose it. The recent calls for federal oversight of sports betting by Senator Orrin Hatch (RUT) and Senator Chuck Schumer (D-NY) have caught the attention of industry observers. What are your objections to federal oversight and is there a possibility that such calls could increase to the point where the government would be hard pressed to ignore them?
- Federal oversight is unnecessary at best and obstructive at worst. PASPA proved that federal oversight was an abject failure for 26 years, succeeding only in enabling a thriving illegal market with no consumer protections and safeguards. New federal mandates to replace unconstitutional, old federal mandates are a nonstarter. The AGA continues to work with all stakeholders, including Senator Hatch and Minority Leader Schumer, to ensure everyone is well informed about how legalized sports wagering works in practice and the protections it enables. Gaming is effectively regulated by thousands of dedicated regulators across the country now, many of which in Nevada, New Jersey, Delaware, Mississippi and West Virginia include oversight of legalized sports wagering. We
should enable the experts to continue to provide this valuable public service. Do you think that a legal betting sector can fully win the hearts and minds of bettors and turn them away from the illegal market; and what can the legal sector do to facilitate that process?
- Mature, legal, regulated sports betting markets are attractive alternatives to current and prospective bettors. According to research AGA released last month with Nielsen Sports, 71 percent of bettors who currently place wagers with a bookie say they would shift some or all of their betting
prioritize policies that first and foremost protect the consumer and enable the legal market to thrive, thereby stamping out the illegal market. Finally, what lessons can be learned from the first three months of legal sports betting in America and how do you see the market shaping up in the medium to longer term?
- The first three months of legal sports betting outside of Nevada have been a resounding success. Legal sports betting is now fully available in five states, four of which have established their own legal,
“PASPA PROVED THAT FEDERAL OVERSIGHT WAS AN ABJECT FAILURE FOR 26 YEARS, SUCCEEDING ONLY IN ENABLING A THRIVING ILLEGAL MARKET WITH NO CONSUMER PROTECTIONS AND SAFEGUARDS.” activity to a regulated market if they had access to a legal platform. With a continued focus on policy that enables a legal market to compete with the illegal one, we are very confident that it will be an attractive option for consumers. •As more states look to go legal, what are the common pitfalls that policy makers should try to avoid when drawing up legislation?
- As legal sports betting expands across the country, policymakers should
regulated markets since May. As states continue to report their new sports betting revenues, we are getting an even better glimpse at the economic benefits that this increased tax revenue can have on jurisdictions around the country. There can be no better place to discuss the implications of legal sports betting than at G2E, and we’re looking forward to mapping out the current landscape and the future of this brandnew sector at the expo’s first-ever Sports Betting Symposium. •
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LEARNING OUT LOUD AS WILLIAM HILL TAKES THE FIGHT TO PROBLEM GAMBLING opportunity. We believe we can be the safest place to do gambling whether in shops or online, in the UK and even globally. Getting this right is critical to our long-term success as a business. We want our customers to enjoy gambling and stay gambling with us for the long term, which means only gambling what they can afford.
“WE WANT OUR CUSTOMERS TO ENJOY GAMBLING AND STAY GAMBLING WITH US FOR THE LONG TERM, WHICH MEANS ONLY GAMBLING WHAT THEY CAN AFFORD.”
‘NOBODY HARMED BY GAMBLING’ by William Hill, one
of the most prominent sports betting brands in both the UK and the US, has been hailed as one of the biggest individual commitments to stamping out gambling related harm. SBC spoke to campaign leader Lyndsay Wright to find out more As part of a new leadership team at William Hill, why did you choose to launch ‘Nobody Harmed by Gambling’ as your new leading corporate initiative?
- We want gambling to be a fun part of people’s spare time, which adds to the excitement of the sports they love. That’s why we must recognise the hidden side of gambling and get much better at helping our customers stay safe. There are 430,000 people in the UK
who are problem gamblers – and 2 million more people are at risk. Of those people who have experienced problems with gambling, studies have found that three in five have suffered depression as a result and 61% have missed work to gamble. It also has a serious impact on friends and family, with an estimated further six people affected for every problem gambler. Our products touch two-thirds of the UK market, which gives us an incredible
We believe that it’s only by setting out with a bold ambition that we’ll start to see the change we want and to have a positive impact on people’s lives. That’s why we’ve set out our long-term ambition that nobody is harmed by gambling. Tackling problem-gambling harms, what unique legacy industry issues and dynamics do you feel have to be addressed by all sector incumbents?
- I believe that a crucial first step is facing into the challenge as a company and as an industry. We recognise that we have not taken seriously enough the challenge of problem gambling. For too long, we’ve talked about individual responsibility and small proportions of adults who experience problems. Every type of gambling product has the potential to cause harm to our customers. That is something we have to acknowledge, and that harm is something we need to face into. So, this means widening the aperture of where we should act. Anyone can become at risk of problems with their gambling.
But today, no-one has defined what really good, in control, gambling behaviour looks like. So, we’re going to work hard on how we design our products, how we advertise them and how we interact with customers in ways that help all our customers stay in control. To take a simple example, too many people aren’t aware of the tools that exist to try to help. Just a third are aware of self-exclusion tools and only half are aware of limit-setting. As we’ve looked again at our current approach, it’s also clear that to prevent harm from gambling, we need to look beyond problem gambling to customers who are at risk – and support them before gambling becomes a problem. We can get better at capturing and using data to identify those risky behaviours and intervene before gambling becomes a problem. ‘Nobody Harmed’ was presented to the market by CEO Philip Bowcock, who detailed that a ‘new direction was needed’ to tackle problem gambling. However, why not wait for industry consensus on tackling the subject matter?
- This is one area of our business that shouldn’t be about competition, it should be about how we can collaborate better to find solutions that work. There’s a lot of interesting stuff going on in the industry. For example, Kindred has been leading the way by innovating on this front, and Sky Bet has been devoting advertising
“PROBLEM GAMBLING IS A COMPLEX ISSUE THAT OFTEN RELATES TO OTHER CHALLENGES IN PEOPLE’S LIVES, FROM WORK AND RELATIONSHIPS TO HEALTH AND ADDICTION.” to responsible gambling. We’ve worked alongside the industry for a long time, and we will continue to do that. But we also knew that we wanted something to drive our own action as a business. This is very much about us and our customers, and being alongside them. We think that will make us successful, and we’ll share what we learn along the way.
24 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
As an industry there’s more to be done – problem gambling rates haven’t changed and the scrutiny on the industry remains. In general, companies are expected to do a lot more to demonstrate their role in society, and gambling’s no different. That’s why we set this ambition to say what we want the world to look like and use that principle to determine what we’ll do to get there. This is where we start. Your scheme places a high emphasis on working with communities and wider stakeholders on tackling problem gambling. How can William Hill develop this ‘open framework’?
- Problem gambling is a complex issue that often relates to other challenges in people’s lives, from work and relationships to health and addiction. That makes the harm from gambling a systemic challenge, linked to a range of social and cultural factors. That complexity means that there is no one single solution and no one organisation can achieve the ambition. We can’t tackle this alone. For us, it is an important early step to bring together people with insight into
the challenges, ideas for solutions and aspirations for the future to explore how we can collaborate on this shared agenda. We’re holding an event in November, bringing our own leaders together with a variety of leading thinkers and practitioners, not only experts on problem gambling, but also from adjacent areas of health, relationships and community, and innovators to help disrupt our collective thinking. We are committed to embracing the new ideas that come out of the day.
Furthermore, you have placed sustainability and responsibility at the forefront of your day-to-day operations. Internally, how have William Hill teams and internal stakeholders reacted to ‘Nobody Harmed’?
- We’ve had a lot of internal support for this. That matters because our colleagues are a crucial part of delivering on this ambition. Our colleagues have been at the frontline of this issue for years and have a lot of great ideas and passion to help us find solutions that work. It’s crucial that each of us is empowered to act on that and to do what it takes to make a difference. We’re creating more ways to get our colleagues involved. We’ve consulted with a core set of expert colleagues in early-stage activity, to better understand what we’re doing today and where the gaps are – and develop this strategy. That includes experts in responsible gambling and customer engagement, as well as our Executive Team and Board. We’ll also hold internal ideas crowdsourcing events and shape an initiative a programme to get colleagues from right across the business out to meet and work with problem gamblers and the organisations that support them. We want to make a positive impact through those efforts, and at the same time get a deeper insight into the challenges and the best ways to help. This agenda also forms a big part of our new values, recently introduced. We have a real opportunity to make gambling-related harm a key part of what we mean by ‘eyes on the customer’ and ‘give a damn’. This is about giving people permission to do things differently and doing more to empower our colleagues with the understanding and skills to make a difference. A core objective is to develop a ‘Responsible Gambling Innovation
Fund’. From your perspective, how can innovation and technology tackle problem gambling, and does the industry need fresh ideas in tackling this complex issue?
- We absolutely need to continue to embrace new ideas, from inside our business, across the industry and from other sectors who’ve made headway on similarly complex challenges. The fund will be used to pilot the best new ideas coming from our colleagues or external partners. It will be supported with a fund of £150,000, and we’ll share what we learn.
“WE HAVE A REAL OPPORTUNITY TO MAKE GAMBLING-RELATED HARM A KEY PART OF WHAT WE MEAN BY ‘EYES ON THE CUSTOMER’ AND ‘GIVE A DAMN’.” Within that innovation, technology presents a huge opportunity to help us tackle this issue. We’re working to help customers stay in control by giving them better access to better data about their own gambling, as well as identifying markers of harm to stop behaviours before they become problems. For example, algorithms that can analyse those data are a vital tool in identifying customers who are at risk of harm and helping drive our decisions on how best to interact with them. Alongside others in the industry, we have made good early progress on
deploying algorithms both online and in betting shops. But it’s just a start. We’re continuing to improve and work on this to get a deeper view of the factors that lead to risk in the first place so that we could intervene with customers at risk earlier and in a more and targeted way. Finally, as ‘Nobody Harmed’ is an open corporate initiative, moving forward how will you share your knowledge and findings with industry competitors?
- As we developed the approach we’re taking, we had a mantra internally to ‘learn out loud.’ That means being transparent about our successes and failures – and sharing what works so that others can benefit. This isn’t going to be a smooth ride. There will be bumps along the road. For example, when we launched the ambition, there was a lot of support and engagement but also, as expected, some scepticism. It’s so important to us to share what we are doing and what we find. We know that it’s only by doing that that people will see we really mean it. So, we will continue to meet and discuss with our regulators, other companies and experts on the issue, and we will continue to convene forums to share insight. And as we get further along our journey we’ll publish what we learn. We’re one of the largest bookmakers in the UK – and there’s a responsibility that goes with that. We can, and we must tackle harm from gambling. Society expects it, our customers need it and a sustainable future for William Hill depends on it. •
NEW EVENT ALERT
SBC MAKES STATESIDE PLAY THROUGH BETTING ON SPORTS AMERICAS THE TWO DAY CONFERENCE
bring together operators, suppliers, regulators, sports organisations and affiliates to discuss the development of what could be the biggest sports betting market in the world
BC Events is bringing its expertise to America to help the gambling industry explore opportunities afforded by the repealing of PASPA restrictions on the betting industry. The events organiser, best known for the ongoing success of Betting on Football and Betting on Sports, is bringing its popular conference and exhibition mix to the US next year in the wake of the subsequent expansion of sports betting in the country. Betting on Sports America is a two day conference, to be held from 24-25 April 2019 in New York, which will bring together operators, suppliers, regulators, sports organisations and affiliates in one
venue to discuss how the industry can be developed in what could be the biggest sports betting market in the world. It will consist of several tracks involving discussions from key industry speakers, supported by an exhibition space showcasing the latest developments from the industry.
“SPORTS BETTING IS A COMPLEX BEAST WHICH IS WHY WE THINK AN EVENT SUCH AS BETTING ON SPORTS AMERICA IS THE PERFECT FORUM FOR DISCOVERY AND DEBATE ON THE SUBJECT.”
SBC CEO & Founder Rasmus Sojmark
explained: “There is understandable excitement at the removal of the constraints around sports betting and there is a unique opportunity now to draw up regulations and develop product for a hungry audience. However, sports betting is a complex beast which is why we think an event such as Betting on
26 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
Sports America is the perfect forum for discovery and debate on the subject.” Managing Director Andrew McCarron added: “A fusion of local knowledge from individual states and extensive operating experience from the European market can make a potent team, which is why discussions ranging across issues such
Betting on Americas track at last month’s Betting on Sports Conference at Olympia London - ‘State of the nation – what does the SCOTUS judgement mean in real terms?’ Sojmark said: “We are extremely happy to be able to get someone of Sue’s standing to help us hold our inaugural Betting on Sports America event next April. Sue is well connected, knowledgeable and probably has the most experience of holding gambling conferences in the whole of the US, so her qualities complement our sports betting expertise perfectly.”
“SBC’S ‘BETTING ON SPORTS AMERICA’ EVENT COULD PROVE TO BE A GREAT CATALYST FOR THE DEVELOPMENT OF THE SPORTS BETTING SECTOR IN THE US AT THIS EXCITING TIME.” McCarron added: “We’ve had a very good response to the way we run our ‘Betting on Football’ and ‘Betting on Sports’ conferences, so we believe the SBC style with its mix of high level education, networking and entertainment, will become an essential event for the sports betting sector. With Sue in as Chief Advisor, we’ve got a good chance.” SBC is already active in America via gaming industry news portal SBC Americas – www.sbcamericas.com. The company will use this knowledge and expertise to bring about the best possible conference content and speakers.
as integrity, sponsorship, marketing and problem gambling will be key to a fully sustainable business.” Gambling industry veteran Sue Schneider has agreed to head up the Advisory Board for this new conference. She is a world renowned expert on the gaming industry, particularly on the US market, where she has testified to the US Senate, the US House of Representatives as well as the National Gambling Impact Study Commission. Schneider commented: “I’ve seen the impressive progress that SBC has been making with its sports betting events elsewhere in the world and so I’m delighted to be able to get involved with
this new chapter now that PASPA has been repealed. “SBC’s ‘Betting on Sports America’ event could prove to be a great catalyst for the development of the sports betting sector in the US at this exciting time.” Already joining Schneider on the Advisory Board are WatchandWager.com President Ed Comins, Missouri Lottery Executive Director May Scheve, DonBest CEO Benjie Cherniak, Hard Rock International’s SVP Gaming Kresimir Spajic, Kindred Group’s SVP USA Manuel Stan and Mississippi Gaming Commission Executive Director Allen Godfrey. To mark the start of this partnership, Schneider chaired the first session on the
The site itself has been designed as a specialist resource for all things sportsbook, betting, gaming and gambling in the Americas including North, Central, Latin and South America as well as Canada and the Caribbean. The editor is Chris Murphy, formerly Group Media & Communications Manager at NOVOMATIC UK and Editor of weekly B2B coin-op title Coinslot International, who joined the SBC team just over six months ago. He said: “This is an exciting time to be a part of the growing team of experts at SBC with a quickly established website devoted to the Americas. The US market, specifically, is heading towards a period of incredible transformation and we’re looking forward to being right in the midst of the action.” •
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FORMER NJ REGULATOR SAYS SPORTS LEAGUES HAVE ‘A LOT OF GALL’ BETTING ON SPORTS 2018
saw a feisty exchange about whether US sports leagues deserve a fee from the gambling industry to help maintain their integrity
he question of whether US sports leagues deserve an ‘integrity fee’ from the gambling industry got a hostile response during last month’s Betting on Sports conference in London. The conference, organised by SBC Events and now the biggest betting trade event in the world, focused an entire track on the US market now that PASPA has been repealed, which has allowed states to regulate sports betting. It was during the first debate of the day
though where George Rover, managing partner at Princeton Global Strategies and former deputy director at the New Jersey Division of Gaming Enforcement, was stringent in his belief that the gambling industry should not be compelled to pay the country’s sporting leagues a fee to maintain integrity in the face of the new sports betting environment. “I think the leagues do have a lot of gall to ask for an integrity fee,” he said, pulling no punches. “They battled the state of New Jersey for nine years. I was there when that was occuring. Not once did they want to come to the table of the regulator or the state about resolving the issue. Not once. Total radio silence. Even after the case no conversations with regulators in the state of New Jersey to try and resolve the issues.”
The comments came after Daniel Wallach, gaming and sports law attorney at Becker & Poliakoff, said that the rhetoric around the fact that the leagues opposed betting needs to ‘be put to bed’ if the industry has any hopes of progressing on the issue.
“I THINK THE IDEA OF HAVING A MECHANISM IN PLACE WHERE THE LEAGUES AND OPERATORS ARE ALIGNED WITH THEIR INCENTIVES IS A GOOD IDEA.” “League is a stakeholder now,” Wallach stated, “and it’s the only stakeholder outside of federal law enforcement that has multi jurisdictional investigators and moderators resources at their disposal. “The NFL, NBA, Major League Basketball, NHL and NCAA all bring something to the table that no state licence holder and no state legislator can possibly
match, which is the ability to investigate, monitor and provide intelligence about all these activities across state lines. “The jurisdiction of the state regulator stops at that border and there is no mandatory sharing of information across those state lines.” But Rover was unconvinced with this argument: “I think the leagues have hardly distinguished themselves in the area of investigations,” he countered. “I can point out all kinds of investigations that the leagues have done - whether a football is inflated or not with Tom Brady, the way they handled that investigation was laughable.” However, Rover did say that his view could change if the states didn’t step up to the plate. “When it comes to dealing with integrity issues I do believe the states at some point have to prove they can handle integrity monitoring,” he continued. “If in six-to-eight months the states aren’t doing a good job, I might have a
BETTING ON SPORTS REPORT
different opinion. For the leagues now to say that they are entitled to a financial windfall, which is what I would call it, I just don’t think they have made the case and I really think they have created their own issue with not trying to work with the state of New Jersey.” The states have got their work cut out though without federal backing. Andrew Winchell, chief of staff for New York Senator John Bonacic, made the point that some of the individual state rules to maintain integrity could be easily circumvented without cooperation. For example, what’s the point in having a mandatory report for bets over $10,000 when someone could place five bets of $9,000 in five different states within a day. He said: “The only way you catch people who are trying to spread out major bets or if there is a match-fixing issue is to have some sort of interstate compact for integrity or a federal framework dealing with integrity. The match is going to be in one place, the bets are being struck in another so figuring out if something untoward is happening will be difficult at best.” Jake Williams, head of legal for the US
at data provider Sportradar, defended the way the sporting leagues had been approaching the issue of an ‘integrity fee’. He challenged: “I think the leagues in the beginning had certain policy considerations they wanted to push and if you’ve read any articles or watched
any clips of Roger Goodell, Adam Silver or any of the other commissioners, they talk about the integrity of the game first and foremost and then further down the line they will talk about their intellectual property, they’ll talk about other policy aspects.” Williams also suggested that it might be worth the expense to the gambling industry to get sport on side. He explained: “I’m from Australia and I’ve seen this
framework, I think the idea of having a mechanism in place where the leagues and operators are aligned with their incentives is a good idea. It’s just the details.” Williams also explained that the integrity fee argument has evolved now and there are more talks about ‘official data’ used for betting purposes and whether unofficial data should be allowed at all. But he wasn’t at all convinced at the
“NOT ONCE DID THEY WANT TO COME TO THE TABLE OF THE REGULATOR OR THE STATE ABOUT RESOLVING THE ISSUE. NOT ONCE. TOTAL RADIO SILENCE.” idea of an integrity fee work relatively well there in terms of having alignment with the sports leagues there engaged and active with sports betting. “In terms of that mechanism, there has been a lot of push back certainly that one per cent of turnover is a bad idea and will stifle sports betting - I think that’s a separate argument. In terms of a mechanism of having sports leagues aligned, I think that’s a good idea. “If you look at who was opposing New Jersey and Christie you will see the sports leagues and NCAA quite literally on the other side of that case. So to get them from the Supreme Court against allowing sports betting in New Jersey to a day in the future where we have leagues aligned and operators aligned, whether its a state framework or a federal
30 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
need for such a requirement, when saying: “The best product in the market should and will win, and the leagues have got a massive advantage when it comes to their own data and pushing it out.” Grover also didn’t see the need. He added: “The point is when it comes to official data, it shouldn’t be mandated. I do believe there is a place for official data and I believe that regulators think there is a place for official data but I think it should come to commercial negotiations like the NBA did with MGM Casino.” Williams concluded: “Nowhere else has official data been mandated in law and if we are going to go down that route then we will have to have a well thought out approach. It may take a state doing it to see how it plays out.” •
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TIME FOR CHANGE CAESARS’ JAN JONES BLACKHURST ON GAMING’S FIGHT FOR GENDER EQUALITY
32 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
SBC TALKS EXCLUSIVELY TO JAN JONES BLACKHURST, former Las Vegas mayor
and now EVP for public policy and corporate responsibility at Caesars Entertainment, about the gender equality issues facing the sector
t ICE Totally Gaming in London in February, the customary practice of using near-naked young women to draw and drive visitors to exhibitor stands became headline news in the UK and beyond. Mail Online, the busiest newspaper website in the world, roared: “Watchdog threatens to boycott event after delegates are caught ogling pole dancers, cheerleaders and Bavarian maids.” It continued: “Gyrating around a pole in black bondage lingerie, a dancer performs for delegates as free booze flows at the gambling industry’s flagship conference.” There was more of the same from the Independent, The Sun and Guardian, the latter observing “guests being entertained by pole dancers”. The UK press, as elsewhere, is prone to hyperbole and sensationalism and, while it is a fact that very few exhibitors were responsible for the behaviour in question, the reality is that the newspaper allegations in this case happened to be true. The incidences of young women - and occasionally men - being asked to walk the floor in a state of near-nakedness have been falling at gaming events on the whole but not to the extent that it can be dismissed as an anomaly, or a rarity. Sex sells and a number of exhibitors continue to use exposed flesh to draw traffic to their displays. Some even going so far as asking the women to perform dances or, in one instance, as reported, pole dancing. The issue is made ever more complex by the fact the promo staff in question were
seemingly not coerced, were evidently well paid and were not asked to do anything that would be considered illegal in an adult-only environment such as ICE. But times are changing. In a postWeinstein era, the depiction and perception of women in entertainment is under the spotlight like never before. Are these young women vulnerable? Are they being exploited? How does it make the women working in the sector feel, to have their male colleagues filling their smartphones with footage of pole-dancing girls in lingerie? What does it say about the attitude of men in gaming to the women around them? It is a complex issue. There are some
I actually believe that featuring the scantily-clad women dancing and entertaining took away from the products they were offering and, in this day and age, showed their lack of understanding of their potential target audiences. In the US, for example, more than 50 per cent of our slot-machine players are women, and I would think they would take offence to certain displays at the event. There is a difference between hiring attractive people to stand at your booth or area in order to draw attendees over, and hiring women who are wearing minimal clothing in order to draw over a limited demographic of men. In fact, I wouldn’t be surprised if there were certain men who were offended by the pole dancing or the body art but would not dare to saying anything to their peers. And how helpful were comments on the matter from the Gambling Commission’s outgoing CEO Sarah Harrison in which she inferred the UK regulator could boycott ICE if standards don’t improve?
- I think it is important for the industry to understand the expectations of their regulators, and Sarah Harrison made her position very clear. As she stated, there are many talented women in the gaming industry in the UK and abroad, and
“THERE IS A DIFFERENCE BETWEEN HIRING ATTRACTIVE PEOPLE TO STAND AT YOUR BOOTH OR AREA IN ORDER TO DRAW ATTENDEES OVER, AND HIRING WOMEN WHO ARE WEARING MINIMAL CLOTHING IN ORDER TO DRAW OVER A LIMITED DEMOGRAPHIC OF MEN.” simple facts, of course, and some clear opportunities for improvement. Jan Jones Blackhurst is a former two-term mayor of Las Vegas and the first woman to have held that office. Jones Blackhurst is now a senior figure at Caesars Entertainment, charged with a government liaison role and part of the gaming giant’s senior leadership team. What did you make of the use of nearnaked women in promotions at ICE earlier this year?
- It is unfortunate that at an important international event such as ICE, where companies showcase the best and the latest technology available to entertain guests, certain companies felt it necessary to draw attention to their product in the manner that they did.
presenting women in that manner did not reflect how far the industry has come. Again, I don’t believe there is an issue with engaging attractive people to draw attendees to your area, but there is no need to dress them or present them the way they did at ICE. I would like to think that the warning sent from the Gambling Commission at ICE will send a message to certain companies that they have crossed a line from tasteful marketing efforts to unnecessarily sexual marketing. So do you think companies using these marketing techniques are perhaps unable to rely on the quality of their products for market appeal?
- I really can’t speak for those companies but I think that they could be certainly be
EXCLUSIVE INTERVIEW JAN JONES BLACKHURST
more creative in the way they market and avoid this objectification of women in the process.” There is no suggestion these women were treated unfairly, coerced or underpaid. Some observers say this makes it acceptable for companies to use models in underwear to promote their products - and ICE is an over-18s event in any case. What harm is being done?
- I am happy to hear that they were generally not treated unfairly, however, I think that it is a known fact that when you present models who are scantily clad, and attendees are able to make physical contact with them, the models are put into an uncomfortable situation that should have been avoided in the first place. Again, the industry should not be putting any women into this situation. I just think our industry is better than this - that there have to be more creative ways to draw attendees to a particular display or product. Groups of men can be seen filming or being photographed with barely dressed PR girls while a number of games characters play on tired female stereotypes - how does this affect the attitude of, and opportunities for, the many women working in the gaming sector?
- Over the past few years, we have continued to see a growing number of successful women take leadership roles in the gaming industry. It is about time that
they receive the respect they deserve and that they have a seat at the table, making important decisions about the future of gaming. At Caesars Entertainment, we have launched a gender equality initiative, called 50/50 by 2025, in our effort to increase the number of women in management levels and above to 50/50 by the year 2025. We want women at our company to know they are valued and respected for their thoughts, ideas and innovations.
“CERTAIN GAMES HAVE AND WILL CONTINUE TO PLAY ON FEMALE STEREOTYPES AND THEY UNFORTUNATELY WON’T START TO FADE AWAY UNTIL A TIME WHEN THE DEMOGRAPHIC OF CUSTOMERS THAT WANTS TO PLAY THOSE GAMES DECREASES.” In contrast to that, I cannot imagine how the industry’s female leaders and attendees felt when they heard about these displays or when they walked past them, particularly if they were in attendance with their male peers. It just continues to reinforce the objectification of women and sets us back. Certain games have and will continue to play on female stereotypes and they unfortunately won’t start to fade away until a time when the demographic of
34 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
customers that wants to play those games decreases.” Some of these promo girls - many of whom are professional dancers and models - will say that they are more than happy to do this kind of work and that fewer such girls on stands at ICE means less income for them. What do you say to those women?
- As I said before, I think that hiring attractive people to draw attention to your products is a form of marketing and should be acceptable. However, it does not mean that they have to be subjected to wearing almost nothing but body paint or a skimpy outfit or that they would be expected to pose for pictures with attendees. Our industry is better than that. So how can we move forward? It’s hard for organisers to police things done in bad taste when no laws are being broken - so where does the lead come from?
- Kate Chambers, the managing director of Clarion Gaming, announced [after ICE] that she wants to work with the industry to identify ways to raise the standards at future gaming shows, encouraging the respectful representation of women and the removal of stereotypes. I am hopeful that the industry will hear the warning of the Gambling Commission and change its marketing methods going forward. It is time for this change. • Jan Jones Blackhurst was talking to Stewart Darkin, editor of CasinoBeats.com
4 DECEMBER 2018 | The Artillery Garden, London
Fifth year of rewarding and celebrating the very best in the betting and gaming industry
CORPORATE SPEED DATING
BRINGING SPORTS BETTING OUT OF THE SHADOWS AND INTO THE LIGHT MOVES TO TRANSFORM
a largely illegal $150bn sports betting market into a clean, fully regulated business are well underway, but some significant challenges remain
or anyone involved in the American sports betting business, the last six months since the strikedown of PASPA will have flown by faster than a toupee in a tornado. Despite a measured pace of take-up by states to introduce legal sports betting, the activity within those jurisdictions that have has been frenetic. The rate at which strategic partnerships have been formed, for example, has been mercurial, with betting’s great and good engaging in what can only be described as corporate speed dating on an unprecedented level.
Where are we currently at? Outside of the established Nevada sportsbooks, betting is now legal in Delaware which was first to go live. New Jersey, second to open sports betting, has become a hive of activity, while Mississippi was third to go legal. Meanwhile, bettors in West Virginia took fourth place in the race, while Pennsylvania and Rhode Island join the fray this month. New York made sports betting partially available in its upstate casinos, but missed the legislative deadline to get statewide wagering onto the statute books. Next up are 14 states currently
considering making the move to legal sports betting. In no particular order they comprise California, Kansas, Oklahoma, Iowa, Missouri, Louisiana, Michigan, Illinois, Indiana, Ohio, Kentucky, South Carolina, Maryland and Connecticut. The latter, it transpired this week, is unlikely to make the cut before the end of this year, mainly due to disagreement among tribal gaming interests. So legal sports betting is, after a fashion, up and running in America. It is perhaps more advanced than observers of this nascent market might have originally anticipated when SCOTUS struck its hammer blow against federal interference back in May. The reason behind that is open to speculation. But the prospect
of turning black market bets into taxrich legal wagers simply has to be a mouthwatering incentive for states to encourage a thriving sports betting sector. As predicted by some of the more erudite
industry thinkers, one of the key factors to this early success has been the willingness to forge partnerships and foster a collegiate approach to technology and knowledge sharing. Hence collaborations between the likes of MGM and the NBA, DraftKings and Kambi, Hard Rock and Kindred, FanDuel and Boyd Gaming and William Hill US with IGT and numerous casinos across West Virginia, Mississippi, Nevada and Delaware. What you know and who you know apply in equal measure
“THE PROSPECT OF TURNING BLACK MARKET BETS INTO TAX-RICH LEGAL WAGERS SIMPLY HAS TO BE A MOUTHWATERING INCENTIVE FOR STATES TO ENCOURAGE A THRIVING SPORTS BETTING SECTOR.” sbcmagazine.com 37
CORPORATE SPEED DATING
in the new legal sports betting era so expect much more of this going forward. While there is clearly an appetite for sports betting, there remain old influences at force, namely tribes that, having cut lucrative deals with state lawmakers, want to retain their exclusive compacts. Why wouldn’t they? In Connecticut, for example, they would like to see sports betting enshrined in law as a style of casino game which, under the current regime, is exclusive to them. In return for that exclusivity the tribes hand over more than $200m a year in revenue to the state. No surprise then that Connecticut’s lawmakers are procrastinating with so much at stake. Amid all this activity has been the
presence of the major sports leagues who say they need to secure funding from sports betting revenue which, ostensibly, will be used to tighten up integrity in sport. Understandably there has been push back on this from operators who argue that the leagues’ take on ‘integrity’ is nothing short of specious. It is, they claim, a thinly-veiled attempt to capture a royalty payment. The American Gaming Association succinctly put it that the leagues’ pursuit of an integrity fee is akin to tripping over dollars to pick up pennies. But with the exception of New York, which made provision for an integrity/ royalty fee in its legislation, the leagues have been given the brush off. Rhode Island went so far as to expressly prohibit any such payment. And while the issue of integrity fees refuses to go away entirely, there is a sense that the leagues know there’s little sympathy for their cause. The closest thing to anything
professional sports league. The terms of the deal focused on MGM Resorts’ use of official NBA and WNBA data and branding, on a nonexclusive basis, across MGM Resorts’ land-based and digital sports betting offerings throughout the US. But as for an integrity fee? Not a sniff! The short- to mid-term outlook for sports betting in the US remains
“SOME BIG-NAME OPERATORS WILL OPERATE ACROSS STATE LINES, BUT AFFILIATES NEED TO STAY UP TO DATE ON WHAT’S HAPPENING AT THE STATE LEVEL SO THEY KNOW WHICH PROGRAMS TO PROMOTE WHERE.” resembling such an arrangement happened in August this year when MGM Resorts International and the NBA forged a multi-year partnership that made MGM Resorts the official gaming partner of the NBA and WNBA. The partnership was the NBA’s first with a sports betting operator in the US and was the first of its kind between MGM Resorts and a major
encouraging, if a little unclear. There are serious questions, for example, over the WIRE Act which presents a challenging conundrum for incumbents looking to offer interstate sports wagering. Then there’s managing the expectations of those state tax officials who view legal sports betting as a lucrative new revenue stream to prop up their public finances.
38 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
They’d do well to listen to those in the know who will testify that when it comes to sportsbook margins, there’s more meat on a butcher’s pencil. If you’re an affiliate looking to gain entry to the US, again the market is likely to present challenges. As Mike Murphy of BettingUSA.com noted: “Affiliates accustomed to working in European markets will find the US market is much more fractured. Rather than thinking of the US as a singular, new market, it should be looked at as many differentiated markets. The United States can best be viewed as 50 individual markets. Some big-name operators will operate across state lines, but affiliates need to stay up to date on what’s happening at the state level
from betting being viewed as taboo to being viewed as culturally accepted and mainstream. The more the paradigm continues to shift in the years ahead, the more the betting activity on NFL – and other sports – will increase.” Ultimately, the aim is to ensure that a US sports betting market worth an estimated $150bn in wagers is regulated, responsible and paying its dues to the tax man. Corporate social responsibility will have a significant role to play in helping the industry move forward in that direction. A major component in achieving
so they know which programs to promote where.” Key to all of these things happening, however, will be convincing those who currently bet via illegal sources to take the path of righteousness and use the services of a licensed betting provider. Many bettors have close, long-established relationships with their bookies who offer convenience, credit, better odds and even cash back on a percentage of their losses. It’s not unusual for the bookie to show up at family events. The figures relating to hooky betting practises are staggering. On NFL and college football alone, $60bn worth of bets were placed last season, with a mere $2bn of that figure via legitimate outlets. March Madness basketball betting generated
$10bn in wagers, but only $300m of that figure was processed through legal betting avenues. Sports betting is evidently ingrained in the US psyche, and the legality or otherwise has rarely been questioned, at least up until now. What legislators and industry stakeholders
will be hoping for is that the strike down of PASPA changes that situation by bringing sports betting from out of the shadows and into the light. Benjie Cherniak of Don Best Sports summed up the situation, saying: “What we are witnessing in the US is a gradual cultural change in attitudes towards sports betting. The change in position is
that aim is the Responsible Gaming Collaborative which pulls together the AGA, advocacy groups, academic institutions and trade associations representing tribal casinos, state lotteries and the thoroughbred racing industry to establish a first-of-its-kind coalition. The Collaborative’s goal, says the AGA, is to broaden the industry’s understanding of what responsible gaming measures are effective, and to align stakeholder policies and industry best practices with those effective policies. “To better identify effectiveness, the group is likely to conduct an extensive audit of the responsible gaming policies in place across the US. The group’s findings will then be used to identify best practices, and to hold states accountable for directing responsible gaming funds generated by the gaming industry to the solutions said funds are specifically earmarked for.” It added: “The evolving approach to responsible gaming is the result of a combination of factors. One factor is a greater emphasis on corporate social responsibility initiatives, not just by gaming companies, but by corporate America in general, with strong social responsibility programs seen as a positive by both investors and consumers. American gaming companies are also aware of acute regulatory pressures being felt by operators in overseas markets like the UK and Australia.” In other words, when it comes to growing the sports betting business, while simultaneously safeguarding everyone who places a wager, we really are all in it together! •
RESHAPING THE WIRE
CHRIS MURPHY: HOW TO SOLVE A PROBLEM LIKE THE WIRE ACT? IT WILL REQUIRE A HUGE LEAP OF FAITH for
t must be remembered that there is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage than a new system. For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain by the new ones.” Niccolò Machiavelli made that famous political observation back in the 1500s, but fast forward to today and it could have been about the current dichotomy that is the Federal Wire Act 1961 and its implications for the brave new world of legal sports betting in America. Machiavelli isn’t the usual go-to
source for inspirational quotes, but on closer examination of the Wire Act, a Machiavellian piece of law if ever there was one, it felt so right. The Act, a sixdecades-old piece of tricky legislation, appears to have been crafted by someone who was in a particularly spiky mood. And it’s deviously effective. Due to its age and lack of relevance to modern technology, the Act is currently creating significant debate, much like the Italian politician did. Listening to the erudite views and opinions expressed during a recent webinar on the topic (from people far smarter than me when it comes to the legal stuff), you could almost imagine a Mexican wave of head scratching taking place as they attempted to place the Act into real-world, modernday context. Fair play to them for trying!
COPYRIGHT : YURI BIZGAJMER
interstate sports betting to get the green light without at least some form of legal change or challenge to the Wire Act 1961
My understanding of the Wire Act is pretty basic and I err on the side of caution, which isn’t altogether a bad thing when it comes to points of law that could lead to a spell in jail for those who transgress. So here goes. There have been some interpretations of the Act, post-PASPA, suggesting that if a state adopts legal sports betting it is breaking no state law by offering interstate sports betting online. Proponents of this theory are essentially re-interpreting the rules to argue that if state law remains
I’m not entirely sure. But taking the law in its baldest appearance, it would require a huge leap of faith to arrive at a conclusion where interstate sports betting is given a green light without at least some form of legal challenge. The sensible option would be to proceed
slowly, allow the debate to take shape and encourage an environment in which the industry and policy makers can agree on a solution to the outmoded strictures of the Wire Act.
THE SENSIBLE OPTION WOULD BE TO PROCEED SLOWLY, ALLOW THE DEBATE TO TAKE SHAPE AND ENCOURAGE AN ENVIRONMENT IN WHICH THE INDUSTRY AND POLICY MAKERS CAN AGREE ON A SOLUTION TO THE OUTMODED STRICTURES OF THE WIRE ACT. intact there’s no case to be answered. And when you break it down to that simplistic level it all sounds rather encouraging. What could possibly go wrong? But having done a fair amount of reading on this, the worrying thing for me is that I can’t find reference to how state law interacts with the Wire Act at all, certainly not in a direct sense. How the courts would view that absence of a link
The alternative, of course, would be to instigate a test case. Far be it from us to recommend such a bold and peremptory strategy, it’s safe to say that this could only be driven by an organisation with pockets as deep as grief and balls of titanium. As strategies go, that’s one that Machiavelli himself would be incredibly proud of! • Chris Murphy is editor of SBCAmericas.com
ENGAGING THE SPORTS FAN
REACHING AN AUDIENCE AHEAD OF REGULATION WHILE MANY STATES consider regulating sports betting, or prevaricate
over the legality of DFS, players should still be entertained
42 SPORTS BETTING GUIDE TO G2E â&#x20AC;¢ OCTOBER 2018
arlier this year, Oddslife teamed up with Belgian operator betFIRST to launch a “Last Man Standing” prediction game ahead of the FIFA World Cup in Russia. Having succeeded in helping betFIRST create ‘match buzz’ and find the sharpest predictors at this summer’s tournament, we caught up with Alexandru Teodorescu, Chief Product Officer at Oddslife, to discuss the tech company’s range of free-to-play (FTP) games, and how its products have been tailored to suit operators in newly regulated markets across the Americas.
They not only help sportsbooks acquire customers in what is likely to be a competitive market, but at the same time they give players a chance to engage and have fun with sports predictions, while also learning the basics and the thrills of sports betting. This primes them for becoming sportsbook players, thus paving the way for higher conversion rates – let’s not forget that sports betting is a brand-new concept and pastime activity to many US citizens.
How can FTP games help a betting operator hit its key marketing goals?
- Oddslife specialises in developing FTP prediction games and content platforms to support the various business goals of sportsbook operators, media companies, right holders and any other sportsaffiliated organisations. Giving the circumstances of the US market, Oddslife can offer the right set of tools to help operators get a head start in the land grab to acquire customers, but also build a relationship with them and provide an engaging experience to keep them loyal once they’ve been acquired. Oddslife has a bespoke approach to each project and provides a variety of game formats that ranges from simple games which can be integrated or proposed as stand-alone websites, to big-scale community platforms with multiple games, sports-related content, virtual currencies and even virtual sportsbooks. The games can be used equally well for one-off events, such as the US Open, or season-long tournaments. •
- Those goals will of course depend on the marketing strategy, which is dictated by several internal and external factors. However, one sure thing is that player acquisition and retention will always sit at the top of the priority list as operators will continuously strive to streamline their costs, while maximising player lifetime value (LTV). This is where FTP games come into the picture, as they can support both acquisition and retention models, among other dynamics. For instance, when it comes to acquisition, operators can set up standalone websites offering such games, which drive traffic whilst entertaining their target audiences. The end goal of FTP games should be to facilitate operators’ referral/conversion processes, helping sports fans become real-money depositing customers. The gameplay itself can be tied to opening an account with a sportsbook. Besides, this is also a slightly different acquisition channel compared to traditional marketing verticals, as it can also broaden sportsbooks audience beyond simple market engagements, so they can be educated and on-boarded into sports betting. As for retention, the key is to keep players engaged for a longer time and increase the switching cost for them. FTP games integrated into sportsbook sites provide that source of engagement, while adding gamification and social elements and storing value in the product which motivate users to stick around for longer. And where retention numbers go up, the LTVs tend to follow. In either case, FTP games also help operators stand out and get their brand voice heard and talked about, and to come
What role does Oddslife have to play in the newly liberalised US market? Alexandru Teodorescu
across as one of the sportsbooks proposing a unique offering. Do FTP games take on even greater significance in the Americas?
- Yes, this concept can be especially important in America, where sports betting operators are looking to acquire and engage customers in states where online betting has been recently legalised or is due to be legalised soon. Whether it’s operators in the process of getting a licence – which can be a time-consuming process – or operators establishing an early presence in states that are supposed to regulate later, FTP prediction games are very well suited for building up a customer base in advance of opening a real money operation.
“ODDSLIFE CAN OFFER THE RIGHT SET OF TOOLS TO HELP OPERATORS GET A HEAD START IN THE LAND GRAB TO ACQUIRE CUSTOMERS, BUT ALSO BUILD A RELATIONSHIP WITH THEM AND PROVIDE AN ENGAGING EXPERIENCE TO KEEP THEM LOYAL ONCE THEY’VE BEEN ACQUIRED.” sbcmagazine.com 4 3
MOVING UP A LEAGUE
PROACTIVE APPROACH FROM THE LEAGUES WILL WIN HEARTS AND MINDS OF SPORTS BETTORS BY EMBRACING the new
world order for legal sports betting in the US, sports leagues can expect to see better engagement with fans and new revenue flowing into the business
esearch firm Nielsen Sports sets its stat machine into action for the American Gaming Association (AGA) recently, with a specific brief to explore how sports betting would impact the major leagues. According to the findings of the study, there will be a marked shift towards legal forms of sports betting in the US, with increased fan engagement in major sporting contests. The chief beneficiary of this uplift, noted the report, is likely to be the NFL, which could see growth of 60 per cent in sports betting, followed by the MLB (+55 per cent), with the NBA and NHL on an equal footing (+24 per cent), post-PASPA.
Looking specifically at the NFL figures,
SBC Americas asked Benjie Cherniak, managing director of Don Best Sports, for his take on Nielsen’s findings. He said: “My view is that we will see a significant uplift. But it will materialize over time, season by season, firstly as more and more states come on board; secondly as the NFL becomes more proactive in working with betting companies to create as synergistic a framework as possible for betting on their sport; and thirdly we see more media exposure and advertising
related to the betting space, led by the interest in betting on NFL.” Cherniak believes that perceptions of sports betting will alter positively, but not swiftly, saying: “What we are witnessing in the US is a gradual cultural change in attitudes towards sports betting. The change in position is from betting being viewed as taboo to being viewed as culturally accepted and mainstream. The more the paradigm continues to shift in the years ahead, the more the betting activity on NFL - and other sports - will increase.” He also offered some thoughts on this season’s NFL betting habits. “The increased betting activity will be restricted to a few states, but it will be very interesting to see how media across the country incorporates the betting space into their content,” he observed. “We know that Fox Sports will have a daily sports betting show, and we are seeing betting specific sections in online
media, such as cnnsi.com. To what extent the NFL commentators discuss points spreads during the live broadcasts remains to be seen and is an interesting sub-plot as the season prepares to get underway.” Finally, we asked the Don Best boss if he was prepared to predict the outcome of this season’s Super Bowl. “I’m actually predicting a rematch of 2017’s game between the Patriots and the Falcons,” he responded. “New England is dominant year in and year out, so I’m not going out on a limb with that selection. “As for Atlanta, they made the Super Bowl two years ago, and last year came up one play short against the Eagles, the eventual champs. I think Atlanta makes it back to the big game this year, which coincidentally takes place on their home field. I’ll then pick Atlanta to beat New England in the rematch thus becoming the first team ever to win a Super Bowl playing at home!” •
sbcmagazine.com 4 5
GEOFENCING STATE BORDERS
THE VIRTUAL FENCE SUPPORTING THE ROLLOUT OF ONLINE SPORTS BETTING ACROSS THE US WHILE ONLINE AND MOBILE SPORTS BETTING
is still to hit the market in West Virginia, early success for its on-site counterpart should dictate that it’s not too far behind
nce online and sports betting comes to fruition in West Virginia (WV), GeoComply, the first company to secure an interim sports betting licence for the state back in August, will have built a virtual fence that mirrors the state’s borders. This will not only ensure that bets are placed by individuals within the state, but also take care of the ‘geofencing’ should operators choose to license a live stream for a sports event. Customers who cross this virtual barrier will lose access to WV sportsbooks. Those heading northeast will move into Pennsylvania – another approved sports betting territory to be geofenced, but one that is lagging a little behind the early movers largely because of an effective 36 per cent tax rate.
David Briggs, the CEO for GeoComply Solutions, commented: “Effective geolocation is essential to the roll out of sports betting and online gaming in the US. Sovereignty over gaming jurisdiction is seeded to each state so that each state can choose to have all or some forms of betting, online or not. “The only way to respect a particular state’s rights is through a geolocation
system that actually works, both to enable the rights of those states that choose to go online and those that chose not to go online. This is very different to Europe where geolocation is not really a compliance focus.”
“IN TERMS OF APPLYING GEOLOCATION RESTRICTIONS ON THE LIVE STREAMING OF SPORTS EVENTS, WE CAN SEE THE NEED FOR THIS CAPABILITY FROM SPORTSBOOK OPERATORS IN THE NEAR FUTURE.” Briggs also spoke about the GeoComply role in live streaming, given that any operator that wants to license the live stream of a sports event is under an obligation to ‘geofence’ the broadcast of
4 6 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
that event only to the state in which they hold a licence. “In terms of applying geolocation restrictions on the live streaming of sports events, we can see the need for this capability from sportsbook operators in the near future,” he said. “One particular area is in terms of in-place betting where sportsbook operators may negotiate the rights to stream live events on their site, to facilitate in-place betting on their platform. “These broadcast licence agreements between sportsbook operators and leagues, teams and other broadcaster will most likely include geographical restrictions on who can access the live streams, so GeoComply’s geolocation technology can ensure that the sportsbooks are abiding by their broadcast licence requirements. “Our geolocation solutions are used around the world to ensure territorial
broadcast rights are respected and are approved by all the major Hollywood studies and the IOC. We also work with premium sports rights holders worldwide to ensure that only viewers in licensed geographical areas are able to access their live sports broadcasts over the Internet.”
“EFFECTIVE GEOLOCATION IS ESSENTIAL TO THE ROLL-OUT OF SPORTS BETTING AND ONLINE GAMING IN THE US.”
Briggs concluded: “GeoComply is one of the few companies from the iGaming space to successfully cross over to the mainstream technology area with even Silicon Valley's very biggest companies (such as Akamai, who’s CDN provides the backbone for most major OTT broadcasters) utilizing our core
technology.” Given that online and mobile sports betting was approved by WV lawmakers as early as March – even before the Supreme Court had reached a decision on the case New Jersey brought against PASPA, the wait for its inception is not expected to be a long one.
The ‘need for speed’ on this front was highlighted by the opening weekend of on-site sports betting in the state. The Hollywood Casino, operated by William Hill in the Charles Town Races venue owned by Penn National Gaming, saw a total of circa $340,000 wagered on the first Saturday of the college football season. Powered by FanDuel, the Greenbrier Resort is expected to be the next of the state’s five casinos to host a live sportsbook, followed by Delaware North properties in Nitro and Wheeling along with Mountaineer Racetrack and Casino in Chester. These two could be operational by mid to late October. •
ITALIAN BETTING FACES NEW REALITIES FOLLOWING CRUEL SUMMER THE LEGA - 5Star
coalition government has served Italian betting stakeholders with a bitter pill to swallow. Nevertheless, the response to Italy’s ‘advertising blanket ban’ should be measured and coherent amid wider European concerns
he strange bedfellows of Lega (far-right) and 5Star (antiestablishment) political parties have flipped the script of the Italian betting sector, serving up their ‘Dignity Decree’ mandate. Political uncertainty is an inherent factor of business in Italy, a country which has recorded six different governments since 2013. However, 2018 had been earmarked as a ‘year of transformative change’ for the Italian betting industry. Following years of deliberation, government and regulatory stakeholders had agreed to revamp and modernise Italian betting’s regulatory framework. Gearing towards a market expansion and
welcoming new bookmaker licensees, the Italian government supported the industry adopting new laws strengthening betting product functionalities, consumer disputes, AML practices and player verifications. Furthermore, national gambling regulator Amministrazione Autonoma dei Monopoli di Stato – (AAMS) launched its comprehensive player self-exclusion programme, improving all-around industry
social responsibility standards. For bookmakers, it appeared as though Italy would finally follow its intended path and modernise its betting structures, as market incumbents dared to believe in a new renaissance for Italian betting. Nevertheless, this naïve optimism was carpet-bombed by the circus of Italian politics, whose March general election delivered the populist clown car of Matteo Salvini, leader of Lega, and Luigi Di Maio, leader of 5Star and former Neapolitan perfume salesman, who secured the biggest representative majorities. Following months of negotiations and several cabinet restructures, Lega and 5Star convinced under-pressure president Sergio Mattarella to approve the formation of a coalition government under the title Governo del Cambiamento (Government of Change), and move forward with the cosanctioned ‘Dignity Decree’, with betting as its ‘Coalition bullet’. Salvini and Di Maio’s Decree seeks to deliver wholescale changes to Italy’s
48 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
labour, social and economic orders. Buried within the Decree’s social reforms was Article 9 titled ‘introducing measures to restrain pathological gambling’, a passage personally penned by Di Maio. During 5Stars’ campaign, Di Maio stated that he would build a ‘stronger social contract against gambling companies’, while lambasting Italian media and football stars such as Francesco Totti for promoting bookmaker services. On 3 July 2018, Di Maio saw his social
justice against gambling approved by the Italian Council of Ministers. Lega-5Star claimed their first combined policy victory, with Italian betting staring at the abyss. With no industry consultation, advertising and sports stakeholders will be forced to end all gamblingrelated marketing/advertising activities by 1 January 2019, with Lega-5Star implementing fines of up to €500,000 for betting firms and media owners who breach its new code. •
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LAND OF OPPORTUNITY
OPENING UP AMERICA’S LAND OF SPORTS-BETTING OPPORTUNITY RICHARD THORP, business development director
at FSB, illuminates the obstacles to entry and the way forward for any US operator after PASPA’s repeal - from state-by-state regs to the future of automated trading What are the legislative challenges for any sports-betting company approaching the US?
- Well, I think that naturally depends on whether it’s a start-up or an established company. In the wake of PASPA’s repeal, we’ve already witnessed a marked trend towards regulators affording the brick-and-mortar establishments, like existing casinos, the first shot at rolling out sportsbooks stateside. If it’s a totally new venture, on the other hand, the landscape looks rocky and foreboding for now. However, this is only the start. Indeed, the challenge for any casino, as an inherently retail product, is to adapt this retail mindset to online. Conversely, any online start-ups might have to bid to develop a retail presence, as the respective rollout of state-by-state licenses stipulates. More crudely, but no less significantly, tax rates in any given state provide the first barrier to entry. For, just as New Jersey or Delaware can kick now on for custom (casinos will pay tax of 8.5% of revenue from land-based bets, and 13% on bets placed online), Pennsylvania’s proposed taxes of up to 35% on gross gaming revenue simply seem unworkable. As a result, differing state rates and their accompanying tax echelons will frame the gateway for allowing sportsbooks to become operational and competitive. Based on the understanding
of our 15-20% UK model, anything above 18% could spell functional prohibition. What other trials lie in store?
- Understanding how to cross-sell into sportsbook by migrating retail customers will positively delineate any operator, alongside profiling the right kind of customer – and educating them in the most efficient way possible. Paddy Power Betfair’s acquisition of FanDuel, leveraging a recognisable American skin coupled to an enormous client base, ostensibly makes sense. However, the underlying assumption
that casual DFS customers will readily morph into loyal repeat bettors on sports betting cannot be taken for granted. Especially as both FanDuel and DraftKings have already laboured to convert their huge acquisitions into anything remotely resembling a profit. A strong local brand and distribution is key to getting head-start, but much hard work lies ahead for education, building a bridge from the familiar (DFS, casino etc) to sports betting. Therefore, the eternal challenges remain for operators to acquire and retain. US casinos, for example, can either decide to learn these skills over time, or recruit a proven expert from Europe with the requisite skill set. When it comes to exporting sophisticated casino customers over to sportsbook, FSB are well-versed. In fact, we’ve already launched a first EPOS system for Manila’s flagship Okada Casino Resort, majoring in self-service betting terminals and hand-held devices.
How best can operators take advantage?
- Of course, it will all hinge on
LAND OF OPPORTUNITY
the individual casino operator, their platform-provider, and the scalability of their combined creativity. An underwhelming triumph would see cookie-cutter legacy platforms rolled out across the US with only the respective skin of the operator enough to denote the difference. Alternatively, casinos can reject this emerging by-the-numbers tradition by sitting down with a supplier to brand the delivery to their existing clients in a way that is actually organic to the interface experience. This very much represents the FSB way, since we have staked our reputation on providing the most flexible backend framework to drive any front-end requirement. This flexibility is premised on state-of-the-art tech and smart APIs which tailor the platform to the brand in frictionless fashion, instead of uninspired bolt-on shells. The disparity is clear to behold. As we’ve observed when rolling out sports betting platforms across Africa (whose state-by-state variety draws direct comparisons with America’s own patchwork multiplicity) defining the UX is vital. Especially for an American public starved of a defined user experience until now. Distinguishing broad consumer betting patterns will also be pivotal. Small stakes and large jackpots may speak to customers in, say, Kenya, but the received wisdom is that accommodating larger stakes at shorter odds could be the way the US tide is running. Engineering the user journey to meet the rising demands of mobile and in-play betting, as well as aggregating the industry’s best data-feeds for core US sports, will prove fundamental to any player remaining ahead of their rivals. Have you seen enquiries for new potential operators in various US states?
- Requests for proposal have been encouraging. FSB’s next-generation architecture is already leading the charge over those idly partnering with existing US platforms, whose infrastructures can date back to the turn of the millennium. As you would expect, RFPs from New Jersey, Delaware and Nevada have been
the most commonplace. However, we’re also noticing a surge in interest from the southern states like Mississippi. It’s an exciting time, but still an embryonic one. What about the trend towards automation in trading; should it embolden US operators taking the plunge on sportsbook?
- Absolutely. Back when mobiles were the size of toasters, the massed ranks of trading desks at the most successful operators were similarly unwieldy. Not to mention costly to acquire and manage. But now the gains in automation which continue to enhance operator performance have spelled an end to this era. Automated technologies deliver
“ENGINEERING THE USER JOURNEY TO MEET THE RISING DEMANDS OF MOBILE AND IN-PLAY BETTING, AS WELL AS AGGREGATING THE INDUSTRY’S BEST DATA-FEEDS FOR CORE US SPORTS, WILL PROVE FUNDAMENTAL TO ANY PLAYER REMAINING AHEAD OF THEIR RIVALS.” 52 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
tangible benefits to margin and pricing for those sportsbook operators and suppliers in a position to embrace them, and have also improved customer profiling and risk-management. And while these components continue to advance, their platforms are also more flexible and fleeter of integration than ever. This trend is only extending, such is the doubling power of technological progress, according to Moore’s Law. However, this isn’t to say that role of the trader is dead. It’s simply evolved. For now, the shrewdies can sometimes fool the trading tools, so manual intervention remains important. By way of analogy, take chess. The algorithms may now wipe board with the Grandmasters, but the best human-computer teams still consistently win against the robots. Algorithms can process a myriad of moves, but a more removed riskmanagement from man-and-the-machine oversight still has its place. As with every intelligent endeavour, though, AI systems
will surpass us one day. So the costs for running these sportsbooks and their efficacy is ever-decreasing. Which sports are currently the closest to full automated trading models, and how are the main US Sports set?
- The telling factor is any sport’s inherent complexity - i.e. how tricky it is to get a trading handle on the key variables that impact performance, activity and scoring? Soccer is streets ahead not because of its popularity, but because a definitive knowledge of these variables is more easily acquired. Tennis is catching up quickly, although a lack of reliability can creep in when demotivated ‘scouts’ or even match umpires react slowly or poorly to feed the scoring system. These automated models also exist for American favourites like basketball, baseball and ice hockey. But NFL is surely the one with the most attendant betting demand for trading systems to get it right. Particularly with derivative player and yardage markets
which occasionally miss the mark – e.g. in late regular-season matches where quarterbacks can get rested for one-off quarters ahead of the play-offs. In an ideal world, though, if you set the automated dials correctly, above all in-play, there should never be a need for a market suspension around a penalty,
“ALGORITHMS CAN PROCESS A MYRIAD OF MOVES, BUT A MORE REMOVED RISK-MANAGEMENT FROM MAN-AND-THE-MACHINE OVERSIGHT STILL HAS ITS PLACE.” a break point, even a coach’s challenge. Ultimately, there should always be a live price. Do you see state-by-state regulation differing wildly or eventually being standardised?
- Of course, every opportunity will be
contingent on state-by-state legislation, each potentially with its own specifics and quirks. However, sensible trailblazers like New Jersey will act as informative guinea pigs for setting the tone and corralling dependable industry wisdom which can be translated to other states. Those previously mentioned issues surrounding tax tiers on turnover, revenue and business rates will help every contender stick a pin in the map for the most feasible states. However, essentially, the US remains a fertile land of opportunity, in which everyone will have to adjust on the fly to some significant degree. Other state-specific variables that need to be factored into the equation include the political and religious persuasions which inform general attitudes towards gambling. For instance, longstanding Christian / Republican guide rails will have to be negotiated in the most evangelical states if sports betting is to be embraced by their mainstream communities. •
KEY RESEARCH FINDINGS
COMPLEXITY AND OPPORTUNITY: HOW THE US BETTING MARKET HAS UNFOLDED SO FAR who opened its sportsbook in July. The sportsbook is run by FanDuel using the GAN platform, whilst utilizing IGT for certain sports betting functionalities. Meanwhile, Paddy Power Betfair, the owner of FanDuel, provides the risk management services to power the sportsbook. Such arrangements are having repercussions on a grand scale, with similar activity amongst betting and gaming conglomerates occurring worldwide. And more is expected. As another example, ahead of the launch of the American football season, was the announcement of a $200m joint venture between GVC Holdings and MGM Resorts.
LESS THAN SIX MONTHS
after the SCOTUS decision, Sportradar assesses the seismic shifts amongst the sporting, data, betting and gaming landscapes
ome of these shifts were anticipated, others not so much, but as Sportradar projected at the outset of the announcement, it is making waves that are being felt across the world, writes Prof. Dr. Laila Mintas, Deputy President for Sportradar US. Recent Nielsen findings have supported the forecast of the creation of a multibillion dollar industry for US sports and associated organisations. In a report from earlier this year, Nielsen shed light on further insights into the possible betting activity associated with the opening of the US betting market.
Prof. Dr. Laila Mintas
Many of the figures reflect Sportradar’s
statements following the decision, that with regulation comes greater opportunity for a safe and secure wagering environment; findings suggesting that 38 per cent of bettors will switch to legal platforms, 33 per cent are expected to use the current methods less and legal platforms more, while 29 per cent of bettors suggest that they won’t change their current habits. Despite this, the fact remains, the process has proven chaotic, at least in this initial phase. And there is expected to be an increasing number of participants entering the marketplace, which will
continue to create complex structures. New Jersey alone has seen a variety of sports, retail, betting and gaming organisations enter the market, forming key partnerships to leverage the opportunities on offer. This includes New Jersey racing and entertainment venue, Meadowlands
“WITH REGULATION COMES GREATER OPPORTUNITY FOR A SAFE AND SECURE WAGERING ENVIRONMENT.”
54 SPORTS BETTING GUIDE TO G2E • OCTOBER 2018
The tie up between GVC, owner of betting companies such as Ladbrokes and Coral, together with MGM, who are well-known for their Las Vegas entities, including the MGM Grand Resort and Casino, will enter the US sports betting market together and leverage their combined experience and expertise. MGM more recently struck a landmark deal with the NBA, as the first US sports league to partner with a sportsbook operator since PASPA was overturned. As the official gaming partner of the NBA and WNBA, it has been reported that the MGM also receives the rights to use league highlights and logos to reinforce their sports betting footprint. All this activity is likely to continue to generate high demand for information and services across sports, media and betting and, as a company who sits in a unique position at the intersection of these industries, we remain excited about the prospects. At the same time, however, we are also prepared and well-equipped to assist clients with our expertise in data, technology and integrity solutions. •
<u> There is data be
every story you tel </u>
<u> There is data behind every story you tell. </u>
Power your stories with Sportradar The action on the playing field can be recorded in different ways, but what matters is the story that it tells. What these stories have in common is the data that they originate from and that data needs to be fast, accurate and trusted. Sportradar provides data to a wide variety of storytellers in the sports ecosystem: media companies, sports federations, state authorities, and bookmakers. That data is what makes us an award-winning, trusted partner of over 600 bookmaker clients and over 30 state lotteries in the betting industry. We provide the pen and paper for you to tell your own story; you just have to write it.
To find out more, contact us at firstname.lastname@example.org