Sports Betting – A Growth Industry…

Anyone who has read these rants for more than a short while knows where I stand with regard to sports betting:

It should be legalized, regulated and taxed.

Banning it is a feckless exercise because making it illegal drives it underground much the same way Prohibition drove the manufacture and sales of alcohol underground.

People are going to wager on sporting contests despite any sort of government intervention that might be acceptable in the US social/political system.

So with those biases on the table, here is some data that might get some of the tight-asses who think that gambling is the work of the Devil to think again. A recent report in the Las Vegas Review-Journal said that the sports betting industry has been growing very rapidly in recent years and that it could be a $5B per year “industry” in Nevada very soon. Here is the trend for the sports betting handle over recent times:

2006: $2.4B
2012: $3.0B
2015: $4.2B

You can see the trend there…

Some folks attribute the explosive growth recently to the use of mobile aps by the sportsbooks. Maybe that is it or maybe it is the fascination with fantasy sports – and daily fantasy sports – that has focused attention on the opportunities to wager on individual sporting outcomes. There are myriad people who play fantasy sports regularly who have never put down a wager on a single sporting event; in a sense, fantasy sports may be the “gateway drug” to sports wagering. Let me give you one vignette that will not “prove” that statement but will give you an indication as to why I am thinking along these lines.

I have a neighbor who is a big sports fan. He is into fantasy baseball and fantasy football up to his armpits. Every reader here knows that I do not play fantasy sports but he surely does. I know that he is in at least 2 fantasy baseball leagues this year and last Fall/Winter he was in at least 3 different fantasy football leagues. He is not averse to wagering money on the outcome of those fantasy league endeavors.

About 6 weeks ago, he asked me to explain how “half-points worked” because he saw a line on a basketball game that had one team favored by 3.5 points. He had no idea what that meant because he knew for sure that there was no such thing as a half-point shot in basketball. After I explained that to him and he understood he had another question for me.

He wanted to know what it meant when odds were listed as -110 or +140. He is an intelligent and educated man so explaining this to him was not difficult but he is in his 60s and he had never encountered either the “half-point concept” for a spread or the common expression of odds on a money-line. [Aside: I was tempted to tell him about Total Lines but thought at that point I might overload his synapses. That lesson is deferred to some later date.]

My point here is that I believe there is a large untapped market for legal sports wagering in the US over and above the HUGE market that is already tapped by the illegal sports betting environment. There is plenty of room for growth in sports betting and the only real question is this:

Will the growth be in the “legal sector” where it is regulated and taxed – – or – –

Not?

In that Las Vegas Review-Journal article cited above, there are data for some recent wagering events:

Super Bowl 50 last February had a handle of $132.5M. That is a 33% increase over the past 3 years.

March Madness 2016 had a handle estimated at $200M. The exact figures are still being tallied in Nevada and will be reported soon.

The Mayweather/Pacquiao fight last year had a handle of $80M all by itself.

A little over 50 years ago, Bob Dylan wrote and sang that The Times they Are a-Changin’. At the time, Dylan was talking about social change and different attitudes with regard to racism; however, today the same concept applies because the times NEED to be a-Changin’ with regard to sports betting in the US.

Now with that polemic as a backdrop, let me inform you that there are lines posted as of today for each and every NFL game for the upcoming 2016 season. That is correct; you can get down on any and all of the 256 games because a company – CG Technology – has posted lines for each game. The company provides tech support to about a dozen sportsbooks in Las Vegas including many that you have heard of and possibly visited in your times there. Yes, I realize that betting on games at this point when the first important and debilitating injury of the 2016 season has not yet happened is tantamount to playing the lottery with smaller payoffs. Nonetheless, the lines are out there if you care to go and find them – and to wager on them if you must.

For the purposes of today’s rant, I will simply list a couple of the biggest point spreads in these “Future Lines” – and from those spreads I think we can spot a perception that is out there:

Niners at Seahawks – 14 – Sept 25 – Largest spread on the board now
Niners at Panthers – 11.5 – Sept 18 – Second largest spread on the board now
Browns at Bengals – 11.5 – Oct 23 – You thought the Browns would dominate?
Niners at Cards – 10.5 – Nov 13 – Looks like a bad year for SF…

Finally, this next item needs a bit of a set-up. The 420 Games are a “series of unique athletic events taking place in CA, CO, WA & OR that promote the healthy and responsible use of cannabis.” All of the events somehow involve feature a 4.20 mile course and there is a beer tasting garden set up by a brewery in Petaluma, CA, educational speeches and of course lots of music. After the 420 Games had concluded, Dwight Perry had this observation in the Seattle Times:

“The 420 Games — “The Olympics for Stoners” — took place March 26 on the Santa Monica (Calif.) Pier, but not without controversy.

“Apparently three contestants were stripped of gold medals when they passed a drug test.”

But don’t get me wrong, I love sports ………