I'm Sorry; So Sorry
Sportsbooks agree to meet with the Massachusetts Gaming Commission to discuss limiting bettors; A new court filing has riled up every corner of sports betting Twitter.
The Bulletin Board
NEWS: Sportsbooks reverse course and (informally) agree to discuss limiting players with the Massachusetts Gaming Commission.
BEYOND the HEADLINE: Bally’s set to Launch in MA on Thursday.
NEWS: The industry’s arguments against higher taxes include pushing the cost onto the player.
NEWS: Kindridge announces the creation of the Military Gambling Awareness Committee to address gambling-related harms within the military community.
AROUND the WATERCOOLER: You guys want to see some wild s**t?
STRAY THOUGHTS: The wise words of Paul and Art.
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Operators Agree to Discuss Limiting Players with MGC
After not showing up for the Massachusetts Gaming Commission’s first roundtable discussion on limiting and banning bettors, Massachusetts sports betting operators have agreed to attend a second, still-to-be-scheduled roundtable discussion.
In addition to their previously stated concerns that the matter required a non-public discussion, MGC interim chair Jordan Maynard intimated that the presence of “analysts from the sports wagerer world” scared off some of the operators.
The next roundtable is far from guaranteed. Demanding the operators speak publicly on certain topics may result in a repeat of the first roundtable.
MGC Commissioner Nakisha Skinner cautioned that the operators cannot show up just to right a past wrong: “It can’t be just a roundtable for the sake of a roundtable where they say they can’t talk because it’s sensitive information.”
Commissioner Eileen O’Brien had a different concern, asking if scheduling the topic as an official meeting rather than a roundtable discussion is a better option.
To no one’s surprise, there was lingering tension in the Commission’s comments.
As I wrote in a feature column titled, Don’t Bite the Hand That Feeds You:
“I don’t see this ending well. The industry could be in for the rudest of awakenings. In the best-case scenario, the MGC will be miffed, and the relationship between regulator and operator will be strained for the foreseeable future.
“Massachusetts has demonstrated what it is capable of but has, thus far, followed Patrick Swayze’s advice in Road House: “Be nice.” The second part of that line is, “Until it’s time to not be nice.””
Beyond the Headline: Bally’s Set to Launch in MA
Nestled within the limiting players talk and all the other agenda items, the Massachusetts Gaming Commission announced that Bally’s plans to launch its Massachusetts mobile betting app on Thursday, June 27.
Update: Bally’s will not launch tomorrow, as it has told the MGC it is not ready. The MGC will host its certificate of operations meeting for Bally's on July 1, per Robert Linnehan.
Bally’s will become the seventh active operator in Massachusetts, joining DraftKings, FanDuel, BetMGM, Caesars, ESPN Bet, and Fanatics.
The state expected to have more interest than licenses (15), but that hasn’t been the case. Massachusetts received just 12 applications; even fewer have decided to stick it out.
Betr and WynnBet have left the state, Barstool Sportsbook morphed into ESPN Bet, and three operators withdrew their licensing applications: PointsBet, Betway, and Bet365.
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Taxes, Get Your Taxes Here
The Sports Betting Alliance’s Jeremy Kudon was quoted twice in a Sports Business Journal article that waded into the sports betting tax rate debate, and it appears he is doubling down on his previous comments about passing costs onto customers.
In the words of Jason Bateman, “That’s a bold strategy, Cotton.”
Let’s start with why states might want to emulate New York. On a per capita basis, New York collected $5.18 per over-21 adult resident. No other state eclipsed $2 per person.
The article notes that the impact of tax rates on overall handle is a mixed bag:
“New York, Illinois, and Massachusetts all had relatively high per capita handle in spite of their higher-than-average tax rates. But Pennsylvania (36% tax rate) and Ohio (20%) both were in the bottom half of per capita handle, while Arizona (10%) was second and Colorado (10%) was third. Iowa (6.75%) and Kansas (10%) both were in the top 10.”
Kudon warns that could (will?) change when sportsbooks have the capability to offer different odds in different states:
“There’s no impetus for the customer to go over the border from New York to New Jersey to get better odds because the companies haven’t gotten to the point where they can offer that. I think Illinois has hastened that process of differentiating odds. That’s one option on the table. In a year or two, you’ll see different odds and real changes.”
I’m very curious if this capability will be deployed in this manner. The problem with going through with this (offering worse odds) is that your competitors don’t have to go along for the ride. So, unless the industry colludes to offer worse odds in high-tax states (a whole new can of worms), operators who offer disparate pricing risk the possibility of other operators undercutting their prices and the accompanying bad press that paints said operators as greedy.
Another sentiment Kudon expressed was a graduated tax being a penalty for success and possibly discouraging a full effort from operators:
“The graduated rate basically penalizes anyone who starts to build any sort of market share, so it’s not just going to be DraftKings and FanDuel that feel the pain.”
I sympathize with this rationale, but federal income tax is based on the same system, and several states use it for other forms of gambling, so this isn’t some left-field proposal.
There is also the Alex Kane point of view, as the Sporttrade CEO (a newsletter sponsor) put it:
Kane spoke at length about this topic in his podcast appearance with me back in March.
Kindbridge Establishes Military Gambling Awareness Committee
Earlier today, Kindbridge Research Institute announced the establishment of the Military Gambling Awareness Committee (MGAC), “a groundbreaking initiative dedicated to addressing and mitigating gambling-related harms within the military community.”
Per the press release, “The committee will collaborate closely with the military and the Department of Defense to identify policy gaps through evidence-based approaches and offer guidance on potential adjustments” and “improve the Department of Defense’s approach to gambling, ultimately advocating for a more holistic public health approach within the military.”
The seven-member committee includes:
Chairperson: Mark Lucia, a Senior Military Research Associate at Kindbridge Research Institute
Policy Advisor: Brianne Doura-Schawohl, founder and CEO of Doura-Schawohl Consulting LLC
Gambling Industry Representative: Richard Taylor, Senior Manager of Responsible Gambling at BetMGM
Sports Industry Representative: Joe Solosky, Managing Director of Sports Betting at NASCAR
Technology/Security Expert: Joseph Martin, CEO of Kinectify
Public Affairs Advisor: Caroline Ponseti, a communications strategist at Invariant
Educational Program Developer: David Yeager, an 11-year veteran of the United States Army and a gambling addiction recovery advocate
And file this next part under the “I still can’t believe this is true” category.
The US armed forces operate more than 3,000 slot machines at its overseas bases. Still, if a servicemember exhibits signs of problem gambling, their health insurance doesn’t cover treatment, which doesn’t matter since they will be kicked out of the service.
Brianne Doura-Schawohl is my guest on this week’s podcast, and this topic comes up toward the end of the discussion.
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Around the Watercooler
Social media conversations, rumors, and gossip.
What a world.
The sports betting universe is akin to Mos Eisley, which Obi-Wan Kenobi warns Luke, “You will never find a more wretched hive of scum and villainy.”
In today’s tale, we meet a lawyer, a John Doe plaintiff, and a beard, who are apparently one and the same person.
Our tale begins with a lawsuit claiming DraftKings helped Gadoon “Spanky” Kyrollos extort the John Doe plaintiff by supplying his personal information to Spanky, who, according to the lawsuit, sent someone to threaten the John Doe plaintiff.
Jessica Welman did a stellar job reporting the story here and here.
But the real popcorn-worthy story is unfolding on social media.
In his response, Spanky explained the situation as your boring, run-of-the-mill beard story:
Spanky and company believed Jacobs was withholding winnings, and things went from bad to worse as they became suspicious and decided to “test” Jacobs:
I told him -- bluffing -- that I had the ability to receive information on the status of the payout from DK (I obviously do not have that power, nor am I connected with anyone who does have that power, given I am banned from betting at DK!)…
Oscar then had a brilliant strategy for following up on our suspicion; he had the idea to use New York's Freedom of Information Law (FOIL) to request, from the regulators, copies of the complaint that Steve Jacobs said he had filed against DK.
What comes next is crazy! What Steve Jacobs never admitted to us was literally 5 minutes after filing the complaint, he sent them a second email at 8:38 pm on February 6, 2023 saying that the complaint he "filed" in his first email was an "accident". 5 minutes! In his "accident" letter, he apologized - saying he was a "gaming lawyer and drafted it for a gaming training module”.
There is so much going on in this story, from the admitted bearing (which seems less-than-optimal) to how this will impact an upcoming NCLGS panel (and bettor-focused initiative) featuring Spanky to Steven Jacobs’ history seen in the tweets from Ryan Butler and David Hill below.
Stray Thoughts
“Still, a man hears what he wants to hear and disregards the rest” ~ The Boxer, Simon and Garfunkel