Veri.bet Blog

Posted on Thu, Sep 10, 2020

The biggest storyline of the 2020 NFL season isn't the pandemic — it's gambling
Posted by Veri.bet
Posted on Thu, Sep 10, 2020

The 2020 NFL season kicks off on Thursday evening, and while much of the media chatter has focused on how the NFL will handle COVID-19 safety precautions, there’s a larger tide this season that will permanently change the NFL: the explosion in legal sports betting, and the league’s open embrace of casino partnerships.

In the two years since the U.S. Supreme Court struck down the federal ban on sports betting, allowing individual states to legalize sports betting, 16 states have done so, joining Nevada in allowing some form of legal sports betting. According to the American Gaming Association, revenue from legal sports betting is up 19% in 2020 through July compared to the first seven months of last year, and the total amount wagered is up 3.2%—all this despite the pandemic shutting down live sports for four months.

Just four years ago, NFL representatives were still publicly repeating Commissioner Roger Goodell’s “integrity of the game” mantra and expressing caution about any embrace of gambling. The NFL’s senior counsel for labor relations said at a 2016 gambling conference, “One point to think about that people don’t mention as much, but is very prominent in the league’s discussions, is: Would legalized gambling affect the product itself... does the money-making enterprise become more important than the game?”

But with $16 billion in 2019 revenue, the NFL is a money-making enterprise above all else. And it has all but overtly opened its arms to betting businesses.
Gaming partnerships galore

Last year, the NFL named Caesars its first official casino sponsor, in a three-year deal reportedly worth $30 million to the league per year. The league was careful to caution that it’s a marketing deal only and does not include betting contests; Caesars cannot use NFL branding on its betting products.

Since then, the NFL has named DraftKings its official daily fantasy sports partner (and again restricted that deal to DFS only, even as DraftKings frantically launches legal sportsbooks and advertises its betting business); it named Gateway Casinos its official casino partner in Canada; and just this week, it named Betcris its official betting partner in Latin America.

In February, the NFL announced it will now allow NFL franchises to ink their own individual casino sponsorships (separate from the league’s Caesars deal) and, in states that have legalized sports betting, teams can build out betting lounges in their stadium. The Dallas Cowboys moved first, signing a deal with WinStar Casino. The New York Jets have an existing deal with 888 Casino.

And this season the Las Vegas Raiders debut in their new $2 billion home of Allegiant Stadium, a few short miles from the casino Strip. Caesars signed on as a “founding partner” of the stadium, so it gets a designated entrance and digital signage inside the stadium.

Many thought the NFL would never have a franchise based in Las Vegas, after it kept the city, and any whiff of gambling, at arm’s length for decades.

Now the same league that shut down a 2015 fantasy football convention in Las Vegas headlined by quarterback Tony Romo will host its 2022 NFL Draft in Las Vegas, pushed back two years after the pandemic turned the 2020 draft into a virtual event.

“Getting a team in Las Vegas is a dramatic situation,” NFL Network insider Ian Rapoport told Yahoo Finance Live on Thursday. “If you asked me five years ago, I would say literally zero chance... We’ve seen the NFL shift greatly on gambling. Teams have partnered with casinos or gambling operations, it has been noticeable and fascinating and I think it’s only going to continue. The fact that Las Vegas, of all places, has a team would be a much bigger story in literally any other situation.”

The NFL’s public position is that all of these moves leave the “integrity of the game” intact and still ward off the stigma of gambling. But the writing is on the wall: just as fantasy football has been a benefit to NFL viewership, legal sports betting is likely to boost NFL eyeballs.

Betting will be good business for the league’s 32 franchise owners. Cowboys owner Jerry Jones knows it: He told Yahoo Finance last year he thinks the tide of sports betting legalization should make the league’s next round of broadcast rights 50% more valuable.

Even amid the endless parade of betting partnerships, the American Gaming Association, in a new survey conducted by Morning Consult, finds that slightly fewer fans plan to bet on the NFL this year: 33.2 million people, down from 38 million last year but still 13% of U.S. adults. Only 20% of those bettors will place their bets at legal sportsbooks, but that’s up 18% from last year. As more states pass legislation and more legal sportsbooks crop up, that slice is expected to grow, though very few experts see the illegal market going away any time soon.

Chalk up that temporary drop in planned betting to the pandemic (which led the NFL to cancel its preseason), and indeed, the AGA finds less excitement for the season overall among NFL fans: only 41% say they are excited. But among sports bettors, 54% are excited for the season. That backs up the theory that people who bet on the games are more interested in watching them.
Betting deals rapidly going mainstream across leagues, broadcasters

Of course, it’s not just the NFL diving in to legal betting, and the NFL has taken great pains to look the least eager of the big pro leagues, compared to the NBA, MLB, and NHL, whose commissioners openly championed legalizing sports betting and voiced their united support for “integrity fees.”

But in a few years, no one will remember or care that the NFL waited six months longer than the other leagues to announce its first DFS sponsor and first casino sponsor.

Broadcasters and media companies are in a frenzy to name their sports betting partner too: Barstool Sports sold a majority stake to Penn Gaming and is launching a betting app in Pennsylvania this month; NBC Sports announced a huge deal that made Australia-based PointsBet its official betting partner, a blow to FanDuel, which was reportedly in talks with NBC; CBS Sports named William Hill its sports betting partner. ESPN is now broadcasting a daily gambling show out of a new studio inside the Linq Hotel & Casino Las Vegas, a Caesars property. DraftKings landed Michael Jordan, an NBA team owner, as a strategic advisor to the board in exchange for an equity stake.

The tide of American sports leagues embracing sports betting appears beyond reversal now. If you doubt it, look no further than the University of Colorado Boulder, which this week linked up with PointsBet to become the first NCAA program to sign a sports betting partner.

PointsBet CEO Johnny Aitken, asked about any potential bad optics around the deal, told Yahoo Finance: “It is a different world. To even think that colleges would strike beer partnerships, for instance, three years ago, would be very different and foreign, but we're now seeing that. A lot of colleges are looking for new funding channels.”

In the wake of a global pandemic that led two of the “Power 5” Division I athletic conferences to cancel fall sports, schools will be even more eager to find new funding channels.

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