The NBA and Major League Baseball have a branding problem.
No, their multi-billion dollar enterprises are doing well and their overall profiles haven’t suffered repeated NFL-style blemishes, but their attempts at branding in the U.S. sports betting realm have so far proven controversial at best.
Yes, we’re talking about the 1 percent “integrity fee,” because the NBA recently said it “doesn’t call it an integrity fee,” rather it would like it to be known as a “sports betting rights and integrity fee.” Hereinafter we’re refer to it as The Fee™ and if you’re just joining us, that refers to the 1 percent off-the-top cut the leagues are seeking on legal sports wagers in every state that has or may legalize sports wagering (pending the outcome of the Supreme Court sports betting case).
The Fee™ is primarily matter of finance — who absorbs this cost? — but also now branding, given the debate over what we’re actually calling it and how it’s perceived by lawmakers and in the court of public opinion. For some guidance on this issue, we’ve turned to Eric Schiffer, entrepreneur, TV personality and chairman of crisis management firm Reputation Management Consultants.
Reputation Management Expert Eric Schiffer Weighs in on NBA, MLB ‘Integrity Fee’ and Branding
Schiffer did not mince words. For complete context, here is the heart of our conversation about The Fee™ :
Eric Schiffer (ES): How are they defining integrity?
SportsHandle (SH): As for the “integrity” in “betting right and integrity fee,” the leagues want a cut that would amount to potentially billions of dollars a year divvied up, to apply it toward monitoring/investigative services to ensure the “integrity of the game.” Many of these services are already being performed. They’re connecting “integrity” here, suggesting this money is necessary to ensure that games are clean and not compromised.
ES: Okay, it sounds like the single biggest shakedown in the history of sports. You can quote me. There already is a requirement from a brand perspective, to ensure that the leagues are not manipulated for the purposes of betting. To suggest that somehow opening up additional monitoring on betting that’s going on already, is going to somehow ensure that there’s less corruption or that any corruption even exists today, is suspicious.
This is a giant shakedown by the leagues. And those in favor of sports betting on a public-policy level, should recognize that, and if the public is interested and they can motivate the public, that’s what matters here. Because the pressure could be put on lawmakers that are going to make that decision. Or put it up to a vote on an initiative basis.
I think the league is looking for an argument so they can get their cut. But to me, it actually works against the leagues, a perception of brand integrity, to even be involved in betting, to even be taking a piece of it. They should be working on ensuring that there isn’t corruption anyway, which they do. It’s highway robbery, NFL/NBA style.
SH: What do you make of the pivot, calling it both a “betting right and integrity fee”? Now they’re trying to basically say it’s a royalty or an intellectual property right, that there would be no betting, but for our games and basically we deserve to be compensated X amount?
ES: There’s no precedent for that. Where was that argument before, when betting has been going on offshore and in certain venues? Why are they suddenly waking up to that? They don’t own the people’s activity out in their own home, outside of their own abode. Are they gonna start licensing anything that involves the league, outside of its own domain? I mean certain things they just can’t control. They’re gonna try. They’ll try to take their best swing at it. And policy makers that may be lobbied by the leagues may be interested. That’s why these things should go to an initiative.
These are not companies that are barely getting by. These are run by ultra wealthy elites, that are out of touch, and that want their next $100 million, when they already have stacks of $100 million. Yet the states are broke in certain cases, or don’t have enough services and may not even have enough services to help injured people. Or to keep streets safe. And we’re gonna give it to help, and instead people should give it to help buy the next yacht for a billionaire in Saint Barts? Craziness.
SH: If you were the individual advising the leagues as they continue to take their best crack at this as you put it, what is your advice at this point?
ES: You know, I wouldn’t take it honestly because I think ethically, it’s challenged. I think the argument is such a giant fraud, that somehow they need it to uphold the anti-corruption, when in fact that should already be happening. And in reality, it is. Right? They do police their own league. I wouldn’t take it because I wouldn’t want to hurt the public, wouldn’t want to hurt the retired police officer who can’t afford healthcare and needs some extra work or needs extra help from the state, who may be broke. I couldn’t take money from some child who can’t get transportation. These are where the states can benefit people and you’re gonna rob money from the state if something like this happens, when it should go to the state.