UK wagering firms gamble on US after sports betting wager ruling
5 June 2018
It's high stakes for UK firms as sports betting wagering starts to spread in America.
From Tuesday, new rules on wagering entered into effect in Delaware, a tiny east coast state about 2 hours from Washington.
Neighbouring New Jersey might begin bets as early as Friday.
The changes are the very first in what could become a wave of legalisation after the Supreme Court last month cleared the way for states to allow sports betting wagering.
The industry sees a "as soon as in a generation" chance to establish a brand-new market in sports betting-mad America, said Dublin-based financial analyst David Jennings, who heads leisure research study at Davy.
For UK companies, which are coming to grips with combination, increased online competition and tougher guidelines from UK regulators, the timing is particularly appropriate.
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But the industry says depending on the US stays a risky bet, as UK companies deal with complicated state-by-state policy and competition from entrenched local interests.
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"It's something that we're really concentrating on, but equally we do not wish to overhype it," stated James Midmer, spokesperson at Paddy Power Betfair, which recently acquired the US dream sports betting site FanDuel.
'Require time'
The US accounted for about 23% of the world's $244bn (₤ 182bn) in gaming income last year, according to a report by Technavio, external published in January.
Firms are intending to use more of that activity after last month's choice, which struck down a 1992 federal law that barred states beyond Nevada and a couple of others from authorising sports betting wagering.
The ruling discovered the law was an over-reach of federal power. But the court it did not actually legalise sports betting wagering, leaving that question to local lawmakers.
That is anticipated to cause considerable variation in how companies get accredited, where sports betting wagering can occur, and which events are open to speculation - with big implications for the size of the market.
Potential revenue varieties from $4.2 bn to almost $20bn each year depending upon aspects like how many states relocate 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 huge'", said Will Hawkley, London-based head of leisure for experts KPMG.
Now, he said: "I think most 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 some time'."
'Remains to be seen"
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Chris Grove, managing director at Eilers & Krejcik Gaming, predicts that 32 states will legalise sports betting wagering in some type by 2023, creating a market with about $6bn in yearly income.
But bookies face a far different landscape in America than they do in the UK, where wagering shops are a regular sight.
US laws minimal gambling mostly to Native American lands and Nevada's Las Vegas strip until relatively recently.
In the popular imagination, sports betting has long been connected to a 1919 baseball World Series match-fixing scandal.
States have also been sluggish to legalise many forms of online sports betting, regardless of a 2011 Justice Department opinion that appeared to remove barriers.
While sports betting wagering is usually seen in its own classification, "it clearly stays to be seen whether it gets the sort of momentum people believe it will," said Keith Miller, law teacher at Drake University and co-author of a book about sports betting guideline.
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David Carruthers is the previous president of BetonSports, who was apprehended in the US in 2006 for running an overseas online sportsbook and served prison time.
Now a specialist, he states UK companies must approach the market carefully, choosing partners with caution and avoiding missteps that might result in regulator reaction.
"This is an opportunity for the American sports betting wagerer ... I'm not sure whether it is an opportunity for business," he states. "It actually depends on the result of [state] legislation and how business operators pursue the opportunity."
'It will be partnerships'
As legalisation begins, sports betting wagering firms are lobbying to fend off high tax rates, in addition to demands by US sports betting leagues, which wish to gather a portion of earnings as an "stability charge".
International business face the added obstacle of a powerful existing video gaming market, with casino operators, state-run lotteries and Native American people that are seeking to protect their turf.
Analysts say UK companies will need to strike partnerships, using their expertise and innovation in order to make inroads.
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They point to SBTech's recent announcement that it is providing technology for Kentucky Derby operator Churchill Downs as an example of the type of deals most likely to materialise.
"It will be a win-win for everybody, but it will be partnerships and it will be driven by innovation," Mr Hawkley stated.
'It will just depend'
Joe Asher, chief executive at William Hill US, is clear-eyed about the truths.
The company has been purchasing the US market considering that 2011, when it acquired 3 US companies to develop a presence in Nevada.
William Hill now uses about 450 individuals in the US and has revealed partnerships with casinos in Iowa and New Jersey.
It works as risk manager for the Delaware Lottery and has invested millions together with a regional designer in a New Jersey horse racing track.
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Mr Asher stated William Hill has ended up being a household name in Nevada however that's not always the goal everywhere.
"We certainly plan to have a really significant brand name presence in New Jersey," he said. "In other states, it will just depend upon policy and possibly who our local partner is."
"The US is going to be the most significant sports betting market in the world," he included. "Obviously that's not going to occur on day one."
US judgment opens way for sports betting
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UK Betting Firms Gamble on uS After Sports Wager Ruling
dianedarcy1516 edited this page 2025-01-02 11:30:19 +08:00