SharpRank’s weekly updates on Compliance, Audit, Legislation, Ethics, & Regulation within the Sports Betting Industry.
Topics 5/29/24:
- Operator No-Show at Massachusetts Gaming Commission Roundtable Fuels Transparency Push
- Parx CEO Testifies Amid Regulatory Discussions on Pennsylvania Skill Games
- West Flagler Challenges Florida Gaming Compact in Supreme Court
- Exploring AI’s Impact on Sports and Betting
- Colorado to Vote on Funding Water Conservation with Sports Betting Revenue
- Delaware Moves to Expand Online Sports Betting Market Amid Revenue Surge
- Brazil Implements Stringent Regulations for Fixed-Odds Betting Authorization
- Global Regulators Collaborate on Industry Challenges at GREF 2024 Conference
- New York Bill Proposes Proposition Betting in Fantasy Sports
Operator No-Show at Massachusetts Gaming Commission Roundtable Fuels Transparency Push
The Massachusetts Gaming Commission held a roundtable discussion on the controversial practice of sports betting operators limiting customers’ activities, but no active Massachusetts sportsbooks attended. The commission had hoped to engage with operators to understand their practices, but operators requested an executive session, which the commission denied for transparency reasons. Only Bally’s Interactive, which holds a license but hasn’t launched in the state, attended. Operators submitted written correspondence instead, citing concerns over revealing proprietary information. DraftKings specifically mentioned the need to protect confidential business practices. The discussion revealed that the issue affects not only professional gamblers but also casual bettors who win frequently. Industry experts suggested increasing transparency and providing clear notifications and reasons for limitations. The commission expressed frustration over the operators’ absence but emphasized that this meeting was just the beginning of an ongoing dialogue to address fairness and transparency in sports betting practices.
Parx CEO Testifies Amid Regulatory Discussions on Pennsylvania Skill Games
During a recent testimony before the House GOP policy committee, Parx CEO Eric Hausler presented data suggesting that Pennsylvania skill games are impacting the state’s casinos. Despite ongoing debates surrounding the regulation of skill games, Governor Josh Shapiro has proposed a 42% tax on them in the upcoming fiscal year budget. Hausler’s statistics indicate that while neighboring states without skill games have experienced substantial growth in slot revenue since 2018, Pennsylvania’s growth has been significantly slower at just 4%. This slower growth is attributed to the presence of skill games in Pennsylvania, according to Hausler. Comparisons with Virginia, which banned skill games in November, show a significant increase in slot revenue post-ban. While Parx remains determined to ban skill games entirely, Hausler acknowledges the likelihood of regulation and supports the implementation of rigorous regulations to address concerns and limit the proliferation of these games. With proposals for skill games tax and regulation bills in the legislature, it seems inevitable that regulation is on the horizon.
West Flagler Challenges Florida Gaming Compact in Supreme Court
West Flagler has submitted its final brief to the U.S. Supreme Court, arguing against the Florida gaming compact that permits online sports betting off tribal land, alleging it violates the Indian Gaming Regulatory Act and grants a monopoly to the Seminole Tribe. The government maintains that the compact does not authorize sports betting off tribal land, citing the D.C. Circuit Court’s interpretation as correct and consistent with IGRA. The Supreme Court will decide whether to grant a writ of certiorari to review the case, with potential implications for Florida online sports betting, though a final ruling may not be expected until late 2025.
Exploring AI’s Impact on Sports and Betting
Artificial intelligence (AI) is poised to transform sports and sports betting, with innovations like Intel’s involvement in the Paris Olympics offering a glimpse into the future of fan engagement and data analytics. However, while AI prediction tools are proliferating, they may not be the ultimate solution for beating bookmakers, as they overlook the complex dynamics of setting odds and the betting industry’s ability to react to market shifts. Moreover, the role of AI in decision-making processes should be scrutinized, as it doesn’t “think” like humans and may struggle with unstructured data. Instead of solely focusing on AI’s impact on betting outcomes, it’s more fruitful to consider how AI will personalize and enhance the betting experience for individual users, potentially through tailored recommendations and real-time data feeds. Despite the excitement surrounding AI’s potential, its true impact on sports betting remains speculative, akin to the early days of the World Wide Web, hinting at significant disruption in the industry ahead.
Colorado to Vote on Funding Water Conservation with Sports Betting Revenue
Colorado residents will vote in November 2024 on whether to allocate sports betting revenue towards water conservation and protection projects, as outlined in House Bill 1436 signed by Gov. Jared Polis. The bill proposes redirecting excess sports betting revenue beyond regulatory costs and responsible gaming support to fund critical water initiatives, a measure with bipartisan support aiming to secure the state’s water future and benefit communities across Colorado.
Delaware Moves to Expand Online Sports Betting Market Amid Revenue Surge
House Bill 365 aims to expand Delaware’s online sports betting market by allowing more operators to enter the space, following the success of the state’s first online sportsbook launched earlier this year. The bill, assigned to the House Appropriations Committee, proposes partnerships with up to two betting operators per racetrack, potentially adding six online operators to the current market, with licenses costing $500,000 each and running for five years. In April, Delaware saw a significant increase in sports betting revenue, with total spending reaching $15.5 million, up 400% from last year, and igaming revenue topping $4.4 million, indicating continued growth in the online gambling sector.
Brazil Implements Stringent Regulations for Fixed-Odds Betting Authorization
Brazil’s Ministry of Finance released Ordinance No. 827/2024 on May 21, 2024, detailing the authorization process for fixed-odds betting operations in Brazil. The ordinance outlines strict requirements for legal entities seeking licenses, including documentation of legal, fiscal, labor, integrity, financial, and technical qualifications. Companies must submit their requests within 90 days, with priority given to applications received during this period, aiming for approvals by December 31, 2024. The Ministry plans to finalize regulations in four stages, with licenses expected to be issued by the fourth quarter of 2024, pending compliance with stringent eligibility and technical standards. Additionally, the Ministry will establish rules for industry contributions to socially responsible causes, with funds allocated to government agencies and charities.
Global Regulators Collaborate on Industry Challenges at GREF 2024 Conference
The Malta Gaming Authority recently hosted the Gaming Regulators European Forum’s (GREF) 2024 conference, welcoming over 90 representatives from regulatory bodies across 25 countries. Topics such as responsible gambling, digital gaming, innovation, and AML measures were discussed, along with the MGA’s ESG Code and international perspectives on gambling regulation. Cooperation among regulators was emphasized, with GREF’s chair advocating for collaboration to propose effective regulation. The importance of international collaboration between operators and the significance of MGA’s Environmental, Social, and Governance Code were also highlighted during the event, along with discussions on AML and CFT measures led by MGA representatives.
New York Bill Proposes Proposition Betting in Fantasy Sports
The introduction of a bill in the New York legislature seeks to authorize proposition betting within the realm of professional sports for participants engaged in fantasy sports activities on legal gambling platforms. Spearheaded by Sen. Joseph Addabbo and Assemblyman J. Gary Pretlow, proponents of gambling expansion within the state, the legislation aims to bolster revenue streams. Currently, New York garners a relatively modest $3 million to $4 million annually from fantasy sports, a figure deemed suboptimal compared to other jurisdictions. The proposed bill, designed to incorporate proposition betting, imposes specific constraints to mitigate potential risks associated with such wagering activities. Notably, it confines prop bets to transactions occurring between individuals within the same fantasy league during a single game, thereby curtailing opportunities for illicit conduct or customer exploitation. Moreover, in response to apprehensions raised by the New York Gaming Commission, Assemblyman Pretlow suggests potential modifications, such as limiting prop betting to season-long predictions, such as Cy Young award recipients. Furthermore, recognizing the fusion of prop betting with fantasy sports, the bill proposes an adjustment to the legal age requirement, elevating it from 18 to 21 years to align with prevailing standards. Despite its significance, the proposed legislation has not attracted substantial attention due to its categorization of fantasy sports as games of skill rather than chance, thus circumventing the need for extensive legislative scrutiny typically associated with gambling expansion initiatives.
