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    If sports betting is so obviously beneficial to the sports leagues, why do they still oppose it? Insiders weigh in.

    Posted by Marco Valerio August 10, 2012

    “Gambling on amateur and professional sports threatens the integrity of those sports.”

     

    Nonsense. Hypocrisy.

     
    SUCH has been the irritated response of the sports betting community to the lawsuit filed on Tuesday by the five major sports organizations against New Jersey governor Chris Christie and two other New Jersey gaming regulators, David Rebuck and Frank Zanzucchi. (You can view the original 12-page complaint here.)

    The lawsuit was startling, but not very surprising. It was known that American sports organizations are staunchly opposed to the legalization of sports wagering. This position, however, continues to puzzle a very large number of sports fans and bettors.

    “Sports betting benefits pro leagues and college conferences by generating more viewers, listeners and online followers,” says professional handicapper “Fairway” Jay. “The increase in viewership by sports bettors means greater ratings, which allows the leagues to generate more revenue via TV and other media contracts in general.”

    In his autobiography Bets, Drugs and Rock & Roll (Skyhorse Publishing, 2007), offshore betting maverick and former illegal bookmaker Steve Budin makes the same point. “Who do you think is watching an NFL game with two minutes to go and the home team ahead by thirty points? Only the people who bet the over/under, which will be determined by a potential score in the waning seconds.”

    Therefore, if the leagues had it their way and sports betting were impossible, they’d lose an indeterminate but substantial amount of viewers. But is this an honorable sacrifice the leagues are willing to make in order to protect the integrity of the game?

    The leagues genuinely don’t like it when match-fixing happens, which it has. In fact, no one likes it, except of course those who stand to gain by it. The Tim Donaghy scandal of 2007, when an NBA referee turned out to have been betting on his own games, was a huge headache for the NBA. Obviously the fans are going to be very pissed and disenchanted if they think the games are rigged. The leagues, therefore, are indisputably doing the right thing, not to mention protecting their own interests, by taking a stand against match-fixing. And since sports betting is what breeds incentive to fix games, the leagues figure that prohibiting sports betting altogether will consequently eradicate match-fixing.

    But due to the particular nature of bookmaking, this remedy is illogical and actually dangerous, as poker blogger @Grange95 aptly writes on his blog CRAAKKER. “A number of collegiate basketball point-shaving scandals were initially detected by legal sports books in Vegas, where smart bookmakers noticed large bets against heavy favorites in otherwise obscure and lightly bet games… If the sports leagues really wanted to guarantee the integrity of their contests, more legal sports gambling, not less, is the proper solution.”

    Jay Kornegay, director of the industry-leading sportsbook at the Las Vegas Hotel, fully agrees. “We are all about integrity,” he tells QuadJacks, speaking on behalf of legal and regulated sportsbook operators, “because integrity is what protects us as well.” Kornegay points out that when a fix is in, and bettors are taking advantage of it, the sportsbook is the first to be a victim of the cheating. To combat this, Kornegay says there is definitely a step-by-step procedure in place for detecting and investigating suspicious betting activity, which concludes with reporting the wrongdoer(s) to the Nevada Gambling Control Board, famous for punishing those looking to defraud the house.

    Faced with the soundness of these counter-arguments, if the leagues have good reasons to remain where they stand, we haven’t heard them yet. Curious, however, is the more temperate position taken by Steve Fezzik, one of the most successful handicappers working and betting in Las Vegas.

    Fezzik, who provides his sports betting insight at LVA Sports, is a strong supporter of greater gambling freedom, be it on sports or anything else. However, he cautions against being too quick to undermine – or outright ignore – what he believes are some legitimate causes for concern on the part of the leagues.

    “A guy who’s gotten three speeding tickets,” says Fezzik to QJ, “has probably sped more than just three times in his life. So even if there have been only half a dozen or so documented, clear-cut match-fixing scandals that have surfaced, how many scandals haven’t surfaced that nobody knows about?”

    At the same time, Fezzik adds that Vegas-like oversight of sports betting “certainly helps.”

    Joe Brennan Jr., the leading gaming lobbyist and primary advisor to New Jersey lawmakers on gambling reform, takes it one step further. “There isn’t a single market in the world where a lack of state regulation results in improved integrity of that market.”

    Brennan also cleverly points out that, for all of their supposed anti-gambling purity, plenty of American sports team owners have controlling interests in soccer teams in England, where sports betting is legal, regulated, and widespread. For instance, Malcolm Glazer owns the Tampa Bay Buccaneers and Manchester United, which just last month finalized a deal for bwin.party to be the team’s “official betting and gaming partner!” The same double standards can be attributed to John Henry and Stan Kroenke, both of whom also own American and English sports teams.

    “I think the number one reason why the leagues are opposed is because sports betting is something that is out of their control,” Brennan tells QuadJacks. “The leagues exert a significant amount of control over their product, including everything having to do with revenue. With sports betting, the leagues would have no such control.”

    Would cutting the leagues in on sports betting make them budge? Brennan says a revenue sharing model has been proposed at times, but he no longer thinks it would be sustainable. The economics would be too complicated and the leagues would want the lion’s share of the profits, which the sportsbooks would be unwilling to simply hand over.

    With compromise thus impossible, the matter is headed toward a serious legal confrontation, the outcome of which is liable to alter the American gambling industry at large. Because the plaintiffs’ complaint is based so much on New Jersey’s alleged violation of PASPA, most of the case may come down to the law’s constitutionality, rather than why sports betting is bad. Regardless, it will be an enormously important case to follow, which the gambling community can expect to do in the company of QuadJacks.

    QuadJacks – Friday, August 10, 2012

    About Marco Valerio

    View all post by Marco Valerio

    There are 5 Comments

    1. Eric Danis
      - August 10, 2012
        -   Reply

      Wow, very well written article!!

      • Zekday0
        - August 11, 2012
          -   Reply

        Ya really great work @AgentMarco

    2. 53.clubs
      - August 12, 2012
        -   Reply

      Well written article – overthought I think, but well written.

      I think that (being a person who has no credentials to speak on the matter whatsoever) the major sports leagues ‘appear’ to be heavily against betting – because they have to ‘appear’ that way. This is not ‘what they want’, but rather, what they need for survival.

      From a PR perspective, sports leagues, teams, and most importantly, players are ‘public figures’ who are built up every day to be ‘role models’ for kids. The leagues need this for revenue – not from advertisers or gate sales, but from retail merchandise and licensing.

      Walk through a typical high school or middle school and count the names of professional athletes that are scrawled across the backs of students just above that player’s respective number on even a single school day and it becomes apparent.

      Players ‘have to be icons and idols – role models for kids’ for the survival of any prfessional sports league. Its the difference between a sports league surviving or not. They can’t make it on ticket sales or advertising alone because there’s not enough money there. The league can only survive if it is able to produce major cash from product licensing/branding and branded retail sales.

      Following this logic, the players’ images have to be saleable to kids. This means that the players images have to be saleable to ‘PARENTS’. I want to be clear, that I am referring to ‘parents’ and not to ‘adults’ because these are VERY different concepts. “What I will do for myself is not what I will allow for my child…”

      If the leagues were to openly support, encourage, or were even caught ‘condoning’ gambling, then the parents would stop supporting the idolization of the league’s players, the retail sales would stop and the league would die. To parents, ‘their kids gambling’ is a lot like ‘their kids smoking crack’. Its fine for them to do it (maybe not the ‘crack’ thing…) but having their kids idolizing players in a sport where ‘betting is condoned’ – and buying their jerseys with the parents money…?!? – Ain’t gonna happen.
      Walk around that same high school or Jr. High and count as many replica Horse Jockey jerseys as you can find – sure, go ahead, do it all week. You’ll certainly find some ugly shirts – but even those are not replica jockey jerseys.

      Behind the scenes, the sports require the betting – heck, the network news sportscasters use the Vegas lines as a part of every day speech – its how sports are defined – they need it for all of the reason’s mentioned in the article – but the leagues can’t, under any circumstances, be seen as condoning the activity. The stronger they ‘come out against gambling’, the more parents say “That NBA,… its a good thing – sure, I’ll buy you that $85 LeBron James shirt, Billy…”

      They don’t have any choice in the matter.

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