Convince Me Otherwise

Efforts to legalize online casino gambling in Maryland keep running into new pockets of opposition. the latest = voters.

Mar 06, 2024

NEWS: Maryland voters oppose online casinos, per new polling.
NEWS: ESPN Bet holds the #3 spot in Ohio despite a massive reduction in promo spending.
BEYOND the HEADLINE: Prime Sports continues to impress in Ohio.
NEWS: 888 pulls out of SI Sportsbook deal as it conducts “strategic review” of US operations.
VIEWS: Tipico ups its customer transparency with its Fair Play Pledge.
QUICK HITTER: Massachusetts Gov. proposes slashing problem gambling funding in half (temporarily).
AROUND the WATERCOOLER: Poker is in the spotlight for the wrong reasons.
STRAY THOUGHTS: Episode 2 of the Talking Shop Podcast.

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Voters Opposed to Online Casino Per Maryland Polling

The Maryland Retailers Alliance has come out against online casino gambling. The group commissioned Public Policy Polling to survey 570 Maryland voters between February 22-24.

PPP asked the question:

“Maryland politicians are considering internet gambling legislation, which would allow 24-hour access to slot machines and casino gambling on your mobile devices. Would you support or oppose expanding gambling in Maryland to allow internet gambling, sometimes called iGaming or iLottery, on your phone or computer?”

The results of the loaded (toward opposition) question were:

Support: 29%
Oppose: 55%
Not Sure: 15%

Follow-up questions presented respondents with reasons to support or oppose online gambling and reasked the original question. The result was less support.

Support: 23%
Oppose: 64%
Not Sure: 13%

I don’t put much stock in this poll, but what is interesting is that the arguments against online casinos resonated better than the arguments for them, such as the following question, which 69% of respondents found at least somewhat convincing without evidence.

“Press reports have documented that online gambling companies are struggling to keep tech-savvy teens and young people from accessing gambling on their phones, increasing the risk of underage gambling. Do you find this a very convincing, somewhat convincing, or not a convincing reason to oppose expanding internet gambling?”
Very convincing .............................................. 44%
Somewhat convincing..................................... 25%
Not convincing……………………………………………….. 23%

Compare that to the pro-online casino financial argument to help fund education, which just 37% of respondents found convincing:

“Supporters of internet gambling have said that allowing iGaming or iLottery in Maryland could generate hundreds of millions of dollars in tax revenue to fund state education needs. Do you find this a very convincing, somewhat convincing, or not a convincing reason to support expanding internet gambling?”
Very convincing .............................................. 13%
Somewhat convincing..................................... 24%
Not convincing ................................................ 53%

Polling aside, Maryland is already having difficulty overcoming opposition from organized labor and stakeholder disagreements about the practicality of online gambling.

“We believe Maryland should not take a risky bet on internet gaming,” Maryland AFL-CIO President Donna Edwards said at a recent hearing on online casino expansion. “The job losses, unstable revenue, and definitely the damage to public health are not worth the risk.”

At the same hearing, representatives from Live! Casino and Churchill Downs came out against online gambling.

ESPN Bet Climbs OH Rankings as Promo Spend Subsides

Ohio revenue numbers are among the more interesting. The state has nearly 20 operators, including the big names, challenger brands, and the very interesting Prime Sportsbook.

The state also pulls back the monthly promotional spending curtain, providing a glimpse into marketing efforts.

In January, ESPN Bet placed third in handle (with a nearly 8% market share), but perhaps more interesting was its promotional spend, which was the least of the Top 5 operators:

FanDuel: $16.6 million
DraftKings: $10.4 million
ESPN Bet: $2.6 million
Bet365: $4.1 million
BetMGM: $3.6 million

The reduced promo spend indicates ESPN Bet is hanging on to customers it attracted through deposit bonuses following its launch.

Beyond the Headline: Checking in on Prime Sports

Prime Sportsbook is truly charting its own course in the US sports betting space by offering the best pricing and no promotions, and bettors are responding.

Per the Ohio Casino Control Commission website, Prime Sports has gone from last place to 9th place since its September launch:

September: $366,001
October: $2,316,643
November: $5,811,983
December: $4,457,367
January: $9,703,293

Of course, the company’s business model means it has an extremely low hold rate and generates very little revenue, but again, it doesn’t have to worry about promotional spending, so for Prime, revenue is revenue.

Ohio is Prime’s only active state, but the company plans to launch in New Jersey and Kentucky soon. Prime Sportsbook Executive Chairman Joe Brennan Jr. said on X, “Going our own way in Ohio. See you next month in New Jersey.”

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888 Ends Deal with SI as it Begins US Exit

In a corporate press release, 888 announced a strategic review of its US operations. Strategic review seems to be a gambling industry euphemism for “we’re losing money hand over fist and need to cut our losses.”

888 is active as a B2C operator in four states:

Michigan - sports betting and online casino
New Jersey - online casino
Colorado - sports betting
Virginia - sports betting

The statement reads in part:

“As part of this strategic process, the Group will consider all potential alternatives that can deliver value for the business. Such alternatives could include the sale (in whole or in part) of the Group’s US B2C business, the controlled exit of US B2C operations, or other possible strategic transactions.”

However, it looks like a decision has already been made to exit, as 888 is terminating its deal with Authentic Brands Group and is willing to pay $50 million just to be done with it:

“This partnership had granted exclusive use of the Sports Illustrated brand for online betting and gaming. As part of the termination agreement, 888 has agreed to pay a fee of $25 million, which will be paid in cash from available resources. Additionally, 888 will pay an extra $25 million between 2027 and 2029.”

What about 888’s B2B online poker operations?

Per the release, “The Group’s existing B2B arrangements in the US are unaffected by today’s announcement.” That means 888 will continue to power Caesars’ WSOP.com online poker sites (in Nevada, New Jersey, Pennsylvania, and Michigan), at least for the time being.

But as PokerFuse’s Nick Jones said on X, the WSOP.com software is extremely dated, and “We’ve long wondered whether 888 and WSOP would formally part ways, with WSOP jumping all-in with GGPoker (which we know is looking for an avenue into the US markets). Could this be the jumping-off point?”

Also of interest is that after its initial 10-year contract, Delaware replaced 888 with RSI earlier this year, with the latter tripling revenue in its first month.

Tipico Places Transparency at the Forefront

Tipico is trying to create a safer and more transparent environment for bettors through a new initiative called Fair Play Pledge. The launch of the Fair Play Pledge coincides with an app update that Tipico believes creates a simpler betting experience.

“The sportsbook industry is criticized for misleading users with vague language and a lack of protective safeguards. This is not the case at Tipico,” said Adrian Vella, Tipico US CEO. “The Fair Play Pledge is much more than just an app upgrade or generic customer service commitment. It is a repositioning of our business, reimagining the relationship with players by putting safety and clarity at the heart of everything that we do.”

The goal is a straightforward, easy-to-understand betting process and rewards program, coupled with easy-to-access responsible gambling features, improved account verification systems, and 24/7 live support.

According to Adrian Vella, Tipico CEO, “Our first-of-its-kind initiative is setting a new industry standard. We’re establishing trust with bettors by helping them fully maintain control of the bets they place while putting safety and clarity at the forefront of everything we do.”

Quick Hitter: MA Considers Cutting PG Funding

Gov. Maura Healey’s $56 billion budget proposal would cut casino gambling revenues earmarked for a public health fund in half, per reporting by the Boston Globe. If enacted, the fund would lose as much as $6 million.

A spokesperson for the Executive Office for Administration and Finance said it would be a one-time cut from 5% to 2.5% and that lower-than-expected tax revenues called for “creative solutions.”

Of note, the balance of the Public Health Trust Fund carries over year-to-year and currently stands at $25 million. Massachusetts spent $12 million on problem gambling services last year, per The Globe.

Possibly related, local reporting in Massachusetts in November called into question the efficacy of the programs being funded. As I wrote at the time:

The article goes on to ask the question, “Is the money being spent where it should be?” It then delves into the numbers, detailing how “only a tiny fraction of” the estimated 500,000 problem and at-risk gamblers are in treatment and noting “the state does not track how many.”

Around the Watercooler

Social media conversations, rumors, and gossip.

More poker problems, as a thread about bots and collusion at an offshore online poker site has received a lot of eyeballs.

And the poker world wants Tom Dwan to follow Teddy KGB’s mantra of “pay that man his money,” as several people have gone public about outstanding debts owed by Dwan for many years.

Stray Thoughts

Episode 2 of the Talking Shop Podcast will be released to paid subscribers later today. All subscribers will have access to the podcast on Saturday.

This week’s guest is Steven Salz, the CEO of Rivalry, a betting platform with an emphasis on esports. The conversation picks up about halfway through when we shift to marketing, as Salz and I have similar views on what works and what doesn’t.

You can listen to Episode 1, my conversation with Dustin Gouker on DFS, Sweepstakes, Poker, and more here.