Vanity Markets
The NBA and its sportsbook partners are discussing limiting some markets to avoid another Jontay Porter incident.
The Bulletin Board
NEWS: The NBA wants sportsbooks to trim their NBA betting options.
WEEKEND CATCHUP: Rhode Island online casino results and Nebraska’s first permanent casino.
NEWS: Online casino gambling is unlikely to make an appearance at an Arkansas regulatory meeting today.
VIEWS: DraftKings made a strange claim during its recent earnings call.
AROUND the WATERCOOLER: Brian Regan’s lottery ticket story.
STRAY THOUGHTS: Boundaries and why children actually love rules.
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Sports Betting’s “Vanity” Markets are Being Whittled Away
The NCAA has racked up an impressive 4-1 record in the 2024 season when it comes to prohibiting prop bets on college athletes. Thus far, Maryland, Ohio, Vermont, and Louisiana have succumbed to the NCAA’s demands - nine other states already prohibited these types of wagers, and a few others are considering it.
Montana is the only state to hand the NCAA a loss, bucking the trend.
And now, in the wake of the Jontay Porter betting scandal, the NBA is getting in on the act. Legal Sports Report was the first to report that the NBA and its partnered sportsbooks are in talks to modify NBA betting markets.
According to ESPN’s David Purdum, the possible changes include “prohibiting betting on players on two-way contracts between the G League and the NBA.” More extreme measures are also being considered, according to ESPN sources, “such as not allowing bets on the “under” on a player prop have been considered.”
However, the “more extreme” measures are being weighed against the ongoing fear of pushing customers into the black market.
These possibilities allow me to pose my new, “Is this a gift to the black market?” question that I first posed in a recent feature column. If a customer is willing to abandon licensed sites because they cannot bet the under on random NBA player props, is that a customer a licensed sportsbook wants?
The first, G-League players on two-way contracts, is the definition of a vanity market, a term I stole from Huddle CEO Francesco Borgosano, who used the phrase on an episode of the Eilers & Krejcik Gaming Zero Latency Podcast (a newsletter sponsor).
A vanity market receives a trivial number of bets and generates very little handle, but it lets operators tell investors they offer over 500 markets.
This one is easy. No one should be betting on G League players called up to the NBA for any significant amount of money. A sportsbook’s exposure should be in the hundreds of dollars. If offered, it should be for peanut limits.
Now, are college player prop bets a vanity market? That’s a far more difficult question, even though they account for less than 2% of the total betting handle. I’ll quote former Illinois* Senator Everett McKinley Dirksen: “A billion here, a billion there, and pretty soon you’re talking real money.”
If you remove three or four of these markets, you suddenly erase 5-10% of the total market. And the black market will thank you.
*This entry has been updated to correctly identify Sen Dirksen as representing Illinois, not Minnesota.
Weekend Catchup: RI iCasino Results; Nebraska Casino Opens Next Week;
First online casino results from Rhode Island: Rhode Island’s newly launched online casino app has generated $1.2 million in its first month. The lottery-run app, offered through the state’s two Bally’s casinos, launched on March 5. Given its structure, a monopoly with an incredibly high revenue split on slots that only permits live dealer table games, Rhode Island will likely be one of the worst-performing online casino states.
A first for Nebraska: Nebraska’s first permanent casino (and sportsbook) will open its doors next week, on May 13. Per GGB, “The 17,000-square-foot casino floor will feature 400 slot machines and 11 live table games, plus a Brew Brothers restaurant and Caesars Sportsbook and racebook. The complex also will offer Nebraska’s only 1-mile horse racetrack, opening August 16.”
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Quick Hitter: Arkansas Commission Unlikely To Discuss iGaming
there is more news on the Arkansas online casino front from Gambling.com’s Larry Henry (who first broke the news that Saracen Casino has requested a rule change to allow online casino gambling). Per Henry, online gambling is not on the Arkansas Racing Commission’s agenda for its scheduled meeting at 11 AM today.
“This meeting is to take the next steps to launch a new application period for the Pope County casino license,” Hardin told Gambling.com. “Getting this license issued remains the commission’s focus.”
If you missed it, Saracen Casino has asked the Arkansas Racing Commission to change its rules to allow online casino games.
Another Earnings Season = More Cherry Picked Numbers
The industry needs to stop pretending we all lack critical thinking skills.
The latest example is DraftKings CEO Jason Robins’ comment during the company’s Q1 earnings call, in which he noted a 7% year-over-year decline in promotional spending “despite launches in North Carolina and Vermont.”
There’s a pretty simple explanation for why promotional spending is down year-over-year. Two significant states went live with mobile betting in Q1 2023: Ohio in January and Massachusetts in March.
The population difference between the 2023hes and 2024 Q1 launches is 19 million to 11.5 million.
The only plausible explanation for Robins’ comments is more states equal more promotional spending. But anyone with a passing understanding of the industry knows that promotional spending goes through the roof around launches.
As Jessica Welman responded on X, “This is why I generally hate earnings calls though. They all come out to say essentially nothing and highlight nonsensical numbers to back up how great everything is. This isn’t just DK, it is everyone.”
Related, Alun Bowden tweeted, “Incredible that US operators are all now reporting structural hold margin to investors. Not actual hold margin. Structural. What it should be if results hadn’t gone against them. Fantastic. Am sure they will be along to explain what true long term to smooth variance any minute… Genuinely feel we’re only a few quarters away from moving reporting to Sklansky Bucks.”
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Around the Watercooler
Social media conversations, rumors, and gossip.
Lottery Geeks comes through with a great gambling bit by one of my favorite comedians (Pop Tarts, Strongmen, Emergency Room, Spelling Bee, Little League, Cranberries, and Eye Doctor, to name a few):
Stray Thoughts
I agree and disagree with this tweet (fed to me by the algorithm).
Yes, I often scratch my head at some of the policies at my kids’ schools, but as someone who teaches martial arts, I also understand the need for rules or, better stated, clear boundaries.
As Jesse Martin posted in a reply:
My own reply is here:
And I would add this: As soon as kids begin to play, they create rules. A game of tag has all sorts of rules about tag-backs, safe zones, do you freeze, and how you get unfrozen. If you don’t think kids like rules, send five kids outside with a ball and go check on the game 20 minutes later. Anyone who works with kids knows they respect clear, consistent, and evenly enforced rules. Set the boundaries, and they will mostly stay within them. Loose boundaries = chaos for all involved, including the kids.