Legal Sports Betting In The U.S.: The British are Coming! The British are Coming!
By Robert H. Mann | Published: August 7, 2018 at 11:30 amThe British are coming!
Historians now say Paul Revere never said it, but currently, at least in the world of expanded legal sports betting, it’s certainly true. But, just why are British-controlled betting companies making their presence so widely felt in the new U.S. sports betting marketplace?
According to insiders and industry observers speaking to Sports Handle on the condition of anonymity, U.S. gambling companies lacked the experience or the personnel to handle what will be a huge undertaking. Even the largest U.S. casino operators, despite the general feeling that PAPSA, the law limiting sports betting largely to Nevada, would be ruled unconstitutional, seem to have been caught somewhat off-guard by the U.S. Supreme Court decision in the New Jersey-led Murphy v NCAA.
Unlike this country, where bookmaking was regarded as shadow and largely illegal activity, in Britain and most of Europe, sports betting and bookmaking remain part of the societal fabric. It may take years for bookmaking, even as it becomes legal in state after state, to lose some of the social stigma associated with it in the U.S..
The New Era of Legal Sports Betting: Las Vegas Is 10 Years Behind, Opening Pathway for British Operators
As one industry insider told me, “How many people in the U.S. have trained for this career path? Anyone with bookmaking knowledge works for an illegal offshore, outside of that you have Vegas properties that are 10 years behind versus Europe.”
He also noted that “in-play” betting in the U.S. (often called “trading” in Europe), regarded as the major growth area of sports wagering, lags significantly behind Europe where trading floors operate as nerve centers at every bookmaking operation.
Only William Hill, the British-controlled bookmaker, appeared ready to spring into action when the PAPSA decision came down in early May. However, William Hill, under the able and farsighted leadership of Joe Asher, is not a casino company in the U.S. In Nevada and now in other jurisdictions, its business model generally calls for leasing casino space, remodeling the facility, sharing a portion of the profit and little of the risk with its landlord.
For this reason, the company was able to quickly move into Delaware where it already had the legal parlay card franchise through that state’s lottery, via its partnership with Scientific Games. In New Jersey, the company developed a close relationship with Monmouth Park, the thoroughbred track that bore all the expense and did all the heavy lifting that resulted in the PAPSA ruling. William Hill is also now operating in Atlantic City at the Ocean Resort Casino.
It seems the large U.S. casino titans readily gave lip service to the concept of being ready for sports betting. However, after the May ruling, they apparently were forced to scramble to get their sports betting operations going. That resulted in new market entrants in non-Nevada states seeking out European groups to access proven wagering platforms, experienced computer programmers, and even some executives to manage the operation.
In new sports betting states that now have legal, real-money online casino games and online sports betting such as New Jersey, the casino giants were already using European-controlled companies’ software to operate online, so it made sense to further expand these kinds of relationships to include sports betting. The major casino companies remain on a mission to aggregate all of their customers’ betting activity, that now includes or will include sports betting, onto one online platform for advanced player tracking and subsequent marketing.
This is at the core of this new “British Invasion.”
The betting platforms currently used in Nevada apparently were unable to fill the needs of the major gaming companies, so they were compelled to look abroad.
Euro Operators Ready
As another industry insider explained, “The Euro operators are offering a turnkey sportsbook solution – platform, data, risk. The U.S. brick-and-mortar locations – be they casinos or racetracks – have limited expertise in sports betting, such that a turnkey solution is attractive to them. Many are signing short-term deals though, or deals with an out clause, such that as they gain experience, they can add their own layers of risk management, data, personalization, etc.”
He continued, “The Euro guys are ready, whereas some of the homegrown guys are not, with exception of William Hill.” He also relayed that Scientific Games (Las Vegas-based but with a major European presence) is still working on its U.S. version of the “Open Bet” platform. IGT (now headquartered in London instead of Reno) still has programming issues. “So by process of elimination, the Euro guys are winning a chunk of the business,” he said.
Sharing the sports betting risk for the U.S. casino giants may also be a major issue prompting them to join forces with their experienced, now deep-pocketed European counterparts. The spate of mergers by British-controlled bookmakers such as Ladbrokes with Coral and GVC with Paddy Power and BetFair among others, have made these bookmaking entities stronger than ever before. This strength has allowed them to swoop in to quickly compete with William Hill, the company that did not consolidate with another firm, even though William Hill has had a U.S. operation far longer than anyone else.
Although many projections pegged the U.S. sports betting market to be in the many billions of dollars and perhaps the world’s largest in five to 10 years, many of the large U.S. casino companies may not have taken these figures seriously. Apparently, now they do and are moving swiftly to access the profits that may be available.
To do this, for most, means taking in an experienced partner, so expect the “British Invasion” to continue as more states open legal sports betting markets.
The British are already here.
[Also See: William Hill Penetrates Mississippi Sports Betting, Teases Much More]
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