bet9ja.com
UK wagering firms gamble on US after sports betting wager judgment

5 June 2018
bet9ja.com
By Natalie Sherman

Business press reporter, New York
bit.ly
It's high stakes for UK companies as sports betting starts to spread in America.

From Tuesday, new guidelines on wagering entered result in Delaware, a small east coast state about two hours from Washington.
bit.ly
Neighbouring New Jersey could start accepting sports betting bets as early as Friday.

The changes are the first in what could end up being a wave of legalisation after the Supreme Court last month cleared the way for states to allow sports betting wagering.

The market sees a "as soon as in a generation" chance to establish a brand-new market in sports betting-mad America, said Dublin-based financial expert David Jennings, who heads leisure research at Davy.

For UK firms, which are grappling with debt consolidation, increased online competitors and tougher guidelines from UK regulators, the timing is particularly appropriate.

Why the sports betting market deals with an unsure future

How does prohibited sports betting wagering work and what are the fears?

But the market says depending on the US remains a dangerous bet, as UK companies deal with complicated state-by-state policy and competition from entrenched regional interests.

"It's something that we're truly focusing on, but equally we do not want to overhype it," stated James Midmer, spokesman at Paddy Power Betfair, which recently acquired the US fantasy sports betting site FanDuel.

'Take time'

The US accounted for about 23% of the world's $244bn (₤ 182bn) in video gaming income in 2015, according to a report by Technavio, external published in January.

Firms are wanting to tap into more of that activity after last month's decision, which struck down a 1992 federal law that disallowed states beyond Nevada and a couple of others from authorising sports betting wagering.

The judgment found the law was an over-reach of federal power. But the court it did not really legalise sports betting, leaving that concern to regional legislators.

That is anticipated to cause considerable variation in how companies get licensed, where sports betting wagering can occur, and which events are open to speculation - with big ramifications for the size of the market.

ranges from $4.2 bn to almost $20bn yearly depending on factors like the number of states transfer to legalise, Oxford Economics approximated in a 2017 research study for the American Gaming Association.

"There was a lot of 'this is going to be big'", said Will Hawkley, London-based head of leisure for consultants KPMG.

Now, he said: "I believe most people ... are taking a look at this as, 'it's a chance however it's not going to be $20bn and it's going to be state by state and it's going to take time'."

'Remains to be seen"

Chris Grove, managing director at Eilers & Krejcik Gaming, predicts that 32 states will legalise sports betting in some kind by 2023, developing a market with about $6bn in annual earnings.

But bookies face a far different landscape in America than they carry out in the UK, where sports betting stores are a frequent sight.

US laws restricted gaming mostly to Native American lands and Nevada's Las Vegas strip until fairly recently.

In the popular creativity, sports betting wagering has actually long been linked to a 1919 baseball World Series match-fixing scandal.

States have likewise been slow to legalise lots of forms of online gaming, regardless of a 2011 Justice Department viewpoint that appeared to eliminate barriers.

While sports betting is typically viewed in its own classification, "it plainly stays to be seen whether it gets the sort of momentum individuals believe it will," stated Keith Miller, law professor at Drake University and co-author of a book about sports betting policy.

David Carruthers is the previous president of BetonSports, who was apprehended in the US in 2006 for running an overseas online sportsbook and served jail time.

Now an expert, he states UK firms need to approach the market thoroughly, selecting partners with care and avoiding missteps that could result in regulator reaction.

"This is a chance for the American sports betting gambler ... I'm not sure whether it is a chance for service," he states. "It actually is reliant on the outcome of [state] legislation and how business operators pursue the opportunity."

'It will be partnerships'

As legalisation starts, sports betting companies are lobbying to fend off high tax rates, along with requests by US sports betting leagues, which want to collect a percentage of revenue as an "integrity cost".

International business deal with the added difficulty of an effective existing gaming industry, with casino operators, state-run lottery games and Native American tribes that are seeking to protect their turf.

Analysts say UK firms will need to strike collaborations, offering their proficiency and technology in order to make inroads.

They point to SBTech's recent announcement that it is offering technology for Kentucky Derby operator Churchill Downs as an example of the type of deals likely to materialise.

"It will be a win-win for everybody, however it will be partnerships and it will be driven by technology," Mr Hawkley stated.

'It will simply depend'

Joe Asher, president at William Hill US, is clear-eyed about the realities.

The company has actually been investing in the US market given that 2011, when it acquired 3 US firms to establish a presence in Nevada.

William Hill now employs about 450 people in the US and has actually announced partnerships with casinos in Iowa and New Jersey.

It works as risk supervisor for the Delaware Lottery and has invested millions along with a regional developer in a New Jersey horse racing track.

Mr Asher stated William Hill has actually ended up being a home name in Nevada but that's not necessarily the objective everywhere.

"We certainly intend to have a really significant brand name presence in New Jersey," he stated. "In other states, it will just depend on regulation and possibly who our regional partner is."

"The US is going to be the most significant sports betting wagering market worldwide," he added. "Obviously that's not going to occur on the first day."

More on this story

US ruling opens method for sports betting wagering

14 May 2018
bet9ja.com
Paddy Power purchases dream sports betting website

23 May 2018
bit.ly