The Cat Is Out Of The Bag
Assuming it makes the ballot, we can begin to look at who intends to stand in the way of Missouri's sports betting ballot initiative, and more importantly, why.
The Bulletin Board
NEWS: Two reasons a major casino company is considering a vote-no campaign against the Missouri sports betting ballot initiative.
WEEKEND CATCHUP: BlueBet exits the US; SEC mandates Availability Reports; Kambi and RSI extend partnership.
NEWS: New York online gambling efforts will get an early start in 2025.
VIEWS: Not all research is created equal, and too often, it just muddies the water.
BEYOND the HEADLINE: A better way to legalize online gambling.
AROUND the WATERCOOLER: Exit stage left.
STRAY THOUGHTS: Youth [sports] gone wild.
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Why Casinos Might Oppose Missouri Sports Betting
In my August 6 newsletter, I broke the news that Missouri's sports betting ballot initiative might face a powerful opponent (powerful enough to kill it at the ballot box).
I’ve been cryptic about who, but the cat has been let out of the bag elsewhere. Legal Sports Report has a nice write-up on the situation, which aligns with what I’ve been hearing, including Caesars considering a vote-no campaign against the ballot initiative.
The reason, as I recently wrote, “The language of the initiative has a unique structure, with licenses limited to each casino’s parent company, Missouri’s six professional sports teams, and two online-only licenses.”
That language limits PENN Entertainment and Caesars to a single mobile betting skin, even though each company operates multiple casinos in the state. This doesn’t mean much for sports betting, but in true cart-before-the-horse thinking is a source of unreasonable concern when Missouri legalizes online casinos in 30 years.
The opposition also stems from the two untethered online licenses. Eilers & Krejcik Gaming (a newsletter sponsor) recently noted, “Both of the above parameters shift market access power in the direction of sports stadia and online operators in a policy climate that still generally favors gambling incumbents.”
Weekend Catchup: BlueBet Out; SEC Availability Reports; Kambi + RSI
BlueBet officially leaves the US: BlueBet is winding down its US operations, as the Australian operator has announced it is pulling the plug on its ClutchBet Sportsbook. In a tweet last week, ClutchBet announced: “We regret to inform you that following an extensive strategic review, ClutchBet Sportsbook has made the difficult decision to shut down its operations in the United States and will no longer be accepting bets after 5 pm MT on Monday, September 16.” the exit comes as no surprise as BlueBet exited Indiana in July amid a “strategic review.” And jump down to the Watercooler section for another exit.
SEC mandates player availability reports: The SEC is the latest conference to announce it is requiring schools to release player availability reports ahead of league games this season. The reports are required for football, baseball, and basketball games. The Big 10 and MAC have already implemented a similar policy as concerns grow following the legalization of sports betting across the country.
Kambi and Rush Street Interactive extend sportsbook partnership: Kambi and RSI have agreed to extend their sports betting partnership for an additional three years. The two companies have been partnered since 2018. RSI is live in 15 US states, Ontario, and several countries in Latin America.
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New York Online Gambling Push Will Start Early
New York State Sen. Joseph Addabbo Jr. told Bonus.com that he plans to introduce an online casino, poker, and lottery bill early in the 2025 legislative session.
According to Addabbo, the state is facing a projected $4 billion to $8 billion deficit, and he believes that online gambling legalization provides a partial solution.
Addabbo has pointed to Gov. Kathy Hochul as the obstacle, as the governor’s lack of support has been fingered as a reason efforts in the legislature have failed. However, Hochul is only one impediment.
Organized labor has become an impossible obstacle to legalization efforts. Addabbo believes it can be removed with more conversations and a compromise with unions that has yet to materialize.
“I know that New York can be the model for other states as we work towards groundbreaking, legal language to not only protect union casino jobs from any cannibalization but also witness employment growth at those brick-and-mortar sites,” Addabbo told Bonus.com in mid-August. “All it will take is the willingness to discuss the inevitable issue of bringing iGaming to New York and creating legislative language that will cure the related concerns while being viewed as the model for other states to utilize.”
Addabbo’s remarks followed a Forbes commentary by gaming attorney Daniel Wallach, who proposed tying land-based jobs to online licensing.
“Instead of trying to win the ‘battle of the experts’ or funding more economic studies, the focus should be on crafting a solution that will meaningfully address the concerns of the HTC and its membership,” Wallach wrote. “In other words, condition the granting of a casino’s iGaming license on its maintaining current employment levels.”
Wallach’s proposal is likely too far for the industry (you can find my thoughts here and others here), but there is something there. The trick will be finding a compromise to satisfy unions and their job concerns while not alienating potential stakeholders.
Beyond the Headline: A Better Approach to Legalization
I’m not convinced that introducing an online gambling expansion bill early in the legislative session is the best strategy.
Yes, it will give you plenty of time to educate lawmakers on the benefits. Still, it also gives opponents (whose arguments resonate better lately) much more time to convince lawmakers that it’s a bad idea.
Given the current environment, the best approach appears to be a late push attached to the budget, similar to how Rhode Island legalized online casino gambling in 2023. Sneak it in late, when balancing the budget is the top concern.
Research Isn’t Always Useful
This entry is more of a rant than usual.
More data isn’t always a good thing. So please, Massachusetts Gaming Commission and other regulatory bodies, I implore you to stop wasting everyone’s time with research projects like the very official sounding but almost entirely meaningless Gambling and Problem Gambling in Massachusetts: Results of Three Online Panel Surveys, produced by the University of Massachusetts School of Public Health and Health Sciences Social and Economic Impacts of Gambling in Massachusetts (SEIGMA).
The latest survey concludes that 25% of gamblers are problem gamblers, and another 25% are at-risk.
These online surveys offer nothing useful. Go ahead and take them, but please stop turning them into official reports. By lending credence to these reports, you are only further muddying the waters and giving prohibitionists a nice talking point to derail serious discussions.
I’ll write the lead for them:
“A recent study by the Massachusetts Gaming Commission found that half of gamblers are at risk, problem, or pathological. The number has doubled since the introduction of sports betting.”
There won’t be three pages of caveats and justifications for the limited ways the data *might* be useful. Just like UMass did in this article on the research, or as New England Public Radio did here, with a lead sentence of, “Researchers say the latest numbers on problem gambling in Massachusetts should give policymakers pause before they approve any more betting options.”
Here is what I’m talking about. Notice the difference between the general population survey and the online survey from the baseline report in 2013/2014 — that should have screamed there is something amiss, and the even bigger discrepancy in 2021/2022, and that number is now up to 25%:
Look at the caveat:
“The main limitation of online panels is that panelists are not randomly selected but rather have self-enrolled. While online panel companies generally stratify their samples to be demographically representative of the population, significant behavioral biases typically remain that cannot be corrected by this stratification or by demographic weighting (e.g., Pickering & Blaszczynski, 2021; Williams, Lee & Back, 2013). One obvious issue is that a non-random minority of people do not use the Internet and thus are not eligible to be part of an online panel. An additional consistent finding is that online panel members tend to have much higher levels of pathology than are found in the general population, including overall rates of substance use, mental health problems, gambling involvement, and addictions.”
When the surveys you specifically say “are a primary tool for public health surveillance” and the survey you know has a higher level of pathology differ to this degree, why are you still collecting data on the latter and issuing a 25-plus page report on it?
Scrap it, it’s junk. The changes you observe or a focus on a specific cohort don’t tell you anything because the data is flawed to begin with.
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Around the Watercooler
Social media conversations, rumors, and gossip.
These tweets from Jackson Blackwell and Steve Bittenbender summarize my thoughts on the latest sports betting exit. We’ve gotten to a point where a licensed operator exiting the market isn’t even news.
Stray Thoughts
I previously mentioned youth sports in the newsletter:
“Through my martial arts school, I see the demands these sports make on young children (and their parents) all the time. Seven- and eight-year-olds are being asked to commit to playing baseball or flag football four-plus days a week and travel to games. I get this for elite middle school leagues and high school, but elementary kids playing a sport for the first time?!?!?!!
“One introductory flag football league in our area requires an eight-year-old playing the sport for the very first time to practice four days a week in the summer from 5:30 to 8 PM.”
This excerpt from an article about private equity getting into youth sports paints a vivid picture of what is occurring, and something I talk to my wife and parents a lot, particularly the two parts I bolded:
“The sandlot era when kids played sports largely unsupervised is long gone… In their place has come the age of travel squads. Kids as young as six are playing on teams with paid coaches, year-round schedules, multiple practices per week, long-distance travel, and, in many cases, intense competition for roster spots. In theory, these teams prepare kids to play at the college level and beyond. In practice, they’re making youth sports increasingly expensive, exclusive, and pressurized.”
Yet, while many parents despise these aspects of the sports, they still sign their kids up. It’s the new “you have to go to college [even if it’s a waste of your time and money]” mindset.
The anecdotal stories we hear at the karate school are remarkable. One local town’s high school football team started performing badly, so they started new youth sports programs that require total commitment (four multi-hour practices and travel games) from little kids as young as 7. One youth baseball coach decided to practice four days a week instead of two, so every other team followed suit.
It’s parents gone wild. Nobody wants to let kids enjoy playing sports anymore.
As I previously wrote:
“My perspective: There is no faster way to make the typical kid hate physical activity than this. Yes, the ones who excel and love playing sports will continue to excel and love sports. But most kids (and their parents) are just looking for something to do and are far more likely to quit a sport early and, more worrisome, feel like physical activity isn’t fun and are less likely to sign up for another sport or activity. They need to learn to love sports.
“Our first goal at our karate school is that whether it is with us, another school, or an entirely different sport, we want kids to enjoy physical activity. You can’t do that by overwhelming them and making them think every sport requires total commitment.”