UK wagering companies gamble on US after sports betting wager judgment
bet9ja.com
5 June 2018
bet9ja.com
By Natalie Sherman

Business reporter, New York

It's high stakes for UK companies as sports betting starts to spread out in America.

From Tuesday, brand-new guidelines on sports betting entered impact in Delaware, a tiny east coast state about 2 hours from Washington.

Neighbouring New Jersey could start accepting sports betting bets as early as Friday.

The modifications are the very first in what might become a wave of legalisation after the Supreme Court last month cleared the method for states to allow sports betting wagering.

The industry sees a "as soon as in a generation" to develop 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 combination, increased online competitors and tougher rules from UK regulators, the timing is especially suitable.

Why the gaming market deals with an unsure future

How does illegal sports betting work and what are the worries?

But the industry states relying on the US stays a dangerous bet, as UK business face complex state-by-state regulation and competition from entrenched regional interests.

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

'Take some time'

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

Firms are wanting to use more of that activity after last month's decision, which overruled a 1992 federal law that barred states outside of Nevada and a couple of others from authorising sports betting.

The judgment discovered the law was an over-reach of federal power. But the court it did not actually legalise sports betting wagering, leaving that concern to local lawmakers.

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

Potential earnings ranges from $4.2 bn to almost $20bn yearly depending on elements like the number of states move to legalise, Oxford Economics estimated in a 2017 research study for the American Gaming Association.

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

Now, he stated: "I think many people ... are looking at this as, 'it's an opportunity 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, handling director at Eilers & Krejcik Gaming, forecasts that 32 states will legalise sports betting in some kind by 2023, producing a market with about $6bn in yearly revenue.

But bookmakers face a far different landscape in America than they perform in the UK, where wagering shops are a frequent sight.

US laws minimal gaming mostly to Native American lands and Nevada's Las Vegas strip up until relatively recently.

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

States have also been sluggish to legalise many kinds of online sports betting, despite a 2011 Justice Department opinion that appeared to eliminate barriers.

While sports betting wagering is usually seen in its own classification, "it clearly remains to be seen whether it gets the type of momentum individuals believe it will," stated Keith Miller, law teacher at Drake University and co-author of a book about sports betting wagering regulation.

David Carruthers is the former president of BetonSports, who was jailed in the US in 2006 for running an offshore online sportsbook and served jail time.

Now a consultant, he says UK firms need to approach the market carefully, choosing partners with care and avoiding bad moves that might result in regulator backlash.

"This is an opportunity for the American sports betting wagerer ... I'm not sure whether it is an opportunity for service," he says. "It truly depends on the result of [state] legislation and how business operators pursue the chance."

'It will be partnerships'

As legalisation starts, sports betting firms are lobbying to fend off high tax rates, along with demands by US sports betting leagues, which want to gather a portion of revenue as an "stability cost".

International business face the added difficulty of a powerful existing gaming industry, with gambling establishment operators, state-run lottos and Native American tribes that are seeking to safeguard their turf.

Analysts say UK companies will require to strike partnerships, providing their know-how and technology in order to make inroads.

They indicate SBTech's current statement that it is offering innovation for Kentucky Derby operator Churchill Downs as an example of the kind of deals most likely to materialise.

"It will be a win-win for everyone, but it will be collaborations and it will be driven by innovation," Mr Hawkley said.

'It will just depend'

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

The company has been investing in the US market given that 2011, when it acquired 3 US companies to develop an existence in Nevada.

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

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

Mr Asher said William Hill has actually ended up being a household name in Nevada however that's not necessarily the goal all over.

"We certainly intend to have a really significant brand name presence in New Jersey," he said. "In other states, it will simply depend on guideline and possibly who our local partner is."

"The US is going to be the biggest sports betting market on the planet," he included. "Obviously that's not going to take place on day one."

More on this story

US ruling opens method for sports betting wagering

14 May 2018
bet9ja.com
Paddy Power buys fantasy sports betting site

23 May 2018