Sports betting boom: Nearly $100 billion has been bet since states could legalize it
Over the last two years, we’ve learned that people like to bet on sports. A lot of people. And a lot of money.
When the United States Supreme Court ruled in May of 2018 that each state could decide whether to allow legal sports gambling, nobody could quite anticipate the gold rush that was coming. Already, 14 states have exceeded $1 billion in sports bets and two others are less than $100 million from reaching that mark.
“It has surprised me,” BetMGM director of trading Jeff Stoneback said. “The last couple years have exploded.”
New York state Sen. Joe Addabbo Jr. fought for years to get sports betting legalized in his state. He knew the potential. At least he thought he did.
New York finally launched online sports betting in January. The state immediately set a national single-month record for bets despite not launching until Jan. 9. New York collected $1.6 billion in sports bets. New York is still adding operators, so it took in $1.6 billion in bets while operating at less than full capacity.
“I could not have ever expected it to this level,” said Addabbo Jr., the chairman of the committee on racing, gaming and wagering in New York.
Other states have had similar stories. Since June of 2018, Arizona, Colorado, Illinois, Indiana, Iowa, Michigan, Mississippi, Nevada, New Jersey, New York, Pennsylvania, Tennessee, Virginia and West Virginia have all taken at least $1 billion in sports bets, according to LegalSportsReport.com. The site said in about 32 months, the total handle for legal sports betting in the United States is $96.6 billion. That didn't even include New York's latest figures.
New Jersey is the leading state with $22.8 billion in betting handle according to LegalSportsReport.com. New York should catch up very quickly. It has been a whirlwind, but it has been for practically every state that has adopted legal sports gambling laws.
“I knew we had potential. But I never knew in less than a month it would do $1.6 billion,” Addabbo said. “It was amazing.
“And we’re not even to the Super Bowl.”
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Sports betting becomes mainstream
Legendary play-by-play announcer Al Michaels, who will call Super Bowl LVI for NBC, was popular in the betting community for years. He would give a nod-and-wink shoutout to bettors, slyly noting that some viewers were still interested in the blowout he was calling. The references probably escaped casual viewers. A bettor sweating an over/under got it. It was a small, secret club.
It’s not uncommon anymore. There’s betting content on most sports networks and websites. Announcers acknowledge point spreads and totals during games. Seemingly overnight, sports betting went from a taboo subject to entirely mainstream.
“The perception of the fan was that the league didn’t want any references to gambling, so what I would do, obviously, through the years is I would come in the back door, sometimes I would come in the side door,” Michaels said during an NBC media teleconference previewing the regular season, "and now I guess they’re allowing me to come in the front door."
For many years, sports bettors either had to play in Nevada or seek out offshore sites or illegal bookies. Not many casual bettors bothered with that. Now sports betting is ubiquitous in legal states, accessible in minutes by downloading an app and depositing with PayPal. In states that have opened up sports betting, there is advertising all around as companies vie for new bettors’ attention. Deposit match bonuses, boosted odds and other promos are common and have turned it into a consumer’s market.
“It’s been a big boon for bettors,” Stoneback said.
Funny enough, the state that might epitomize the sports betting boom is Nevada, which for decades was the only state in which you could legally place a sports bet.
It made sense that Nevada fought sports betting becoming legal everywhere, and worried when the Supreme Court ruling came down. You’d figure with sports betting legal in more than half of the United States, Nevada’s numbers would be down.
The sports betting numbers in Nevada have gone up.
“I thought it may take a chunk out or make a difference for the big events like March Madness and the Super Bowl,” Stoneback said. “But people are still coming out. Vegas is the place to be.”
While bettors can stay home and bet, the positive effect in Nevada is easy to understand. Information on sports betting is more plentiful than ever. Someone who might not have understood the difference between the moneyline, point spread and total a few years ago has a betting app. He or she learned the nuts and bolts of sports betting on their phones instead of in a line with sophisticated bettors impatiently waiting behind them. Or they download a Nevada-based sports betting app like BetMGM when they arrive.
“You’re not intimidated by walking up to the counter and seeing that -145 number on the board,” Stoneback said. “It’s so much in the open, in the mainstream. It’s like a wildfire.”
If California adopts legal sports betting, that could cut into Nevada’s numbers. Las Vegas sees a lot of Californians come to town each weekend. But that could be offset by more tourists not being scared off by the sportsbooks in Vegas. They’ve made plenty of bets already, before they ever left home.
Props change sports betting
The biggest change to the sports betting market since the customer base has exploded is something topical for this week: Props.
For many years, prop bets were only posted for the Super Bowl or a big primetime NFL game. If you have BetMGM in any state, you know that just about every game, no matter the sport, has dozens of props listed. If you want to bet on Giannis Antetokounmpo’s total rebounds or whether Harry Kane will score a goal for Tottenham Hotspur, you can. There are dozens of props for your average midweek NBA game. That was unheard of a few years ago.
“That’s where it really changed,” Stoneback said. “I always say, doesn’t anyone make a normal wager anymore, like Bulls -3.5? No, they want a prop.”
Apps in general have been the driver behind the rise in popularity. That accessibility can create issues. Addabbo said New York has set aside $6 million per year to provide support for sports betting addiction.
"Hopefully they’ll do it in moderation," Michaels said during the preseason NBC teleconference. "We hope that people — it’s fun when you go bet $25 on a game and you have a little bit more interest in it, that’s fine.
"I think where you could run into some trouble and people could run into trouble, you start betting on every play, and look out, the next thing you know, they’ll foreclose on your mortgage. Hopefully we don’t get to that point."
The popularity of sports betting might not fade away, like the poker boom of the 2000s. The constant changing nature of teams' rosters and fortunes keeps it fresh, Addabbo hypothesized. There will be more outlets to bet, too. Some stadiums and arenas have started to add sportsbooks or betting kiosks on site, and Addabbo predicted that will be the next step for many states. He said he can envision betting kiosks at Yankee Stadium and other New York sporting venues sometime soon.
Super Bowl LVI will likely be the most bet-on event in history. A number of states that didn’t have legal betting last year will have it for this Super Bowl, including New York. The single-day betting record is $158 million, set in Nevada during the 2018 Super Bowl. It would be surprising if the Bengals-Rams Super Bowl numbers don't set a new record.
And then on Monday, bettors will open their apps and find an NHL or college basketball game to bet on.
“It’s amazing how this took off,” Addabbo said. “I don’t think it’s going to die off either.”
