Sports Betting And Pennsylvania Hot Topics At First Post-PASPA Gaming Conference

Posted By Steve Ruddock on June 8, 2018

The first major gaming conference held in the post-PASPA era is in the books. GiGse (Global iGaming Summit & Expo) took place from May 30-June 1 in Miami, and suffice it to say, sports betting was all the rage.

Another topic that came up quite a bit was Pennsylvania, and its progress on several gaming expansions the legislature passed last year.

Here are some of the highlights from the conference.

Sports betting the topic du jour

As noted above, sports betting was all anyone really wanted to talk about.

Fortunately, the GiGse agenda provided ample opportunity to get your sports betting fix.

Two of the first three sessions on Day 1 of GiGse were dedicated to sports betting. No shortage of topics was discussed, including the legislative landscape.

The map highlights an inconvenient truth: Sports betting legislation is going to be a slower slog than most people imagined.

As the next three tweets by Washington State Gaming Commission Chair Chris Stearns indicate, there’s an overwhelming number of moving parts involved. There are also unanswered questions that still need to be addressed.

These range from federal intervention, to state-specific stakeholder concerns, to post-legislation regulations and implementation.

Overall, the sports betting vibes at GiGse can be best described as possessing tempered optimism.

Like the first level of a video game, the path is clearly marked and the clues are easy to follow. Unfortunately, when you have novice players (and most state legislatures are precisely that) not everyone is going to progress at the same rate. And there are going to be a few mishaps along the way.

The DFS-sports betting connection

One interesting side conversation was the connection between fantasy sports and sports betting.

The US is the DFS market, and as such it will act as the test case to determine:

  • How well DFS players convert to sports bettors.
  • If DFS is a stand-in product, or if it can coexist with sports betting.
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Pennsylvania built it, but will anybody come?

Pennsylvania is in the midst of a major expansion of gaming that includes forthcoming launches of sports betting and online gambling.

How successful Pennsylvania will be on those fronts was an open question at GiGse.

Kevin O’Toole, executive director of the Pennsylvania Gaming Control Board, was on hand to answer some of those questions.

“In both of those activities, the legislature was very clear that they wanted to make this a supplement to our successful land-based casinos. Much of the new gaming act gives a great significance to those land-based casinos,” O’Toole told attendees.

But O’Toole’s optimism was met with skepticism by casino operators.

The hefty up-front licensing fees ($10 million for sports and another $10 million for online gaming) coupled with exorbitant tax rates have some wondering if sports betting or online gaming can be viable businesses in the state.

Thomas Winter, vice president of online gaming for Golden Nugget, estimated a $10-$15 million loss for Golden Nugget over the first five years. Winter’s best case scenario would have Golden Nugget breaking even after Year 5.

Aviram Alroy, vice president of interactive games for Mohegan Sun, indicated the company is having an internal discussion to determine if the Pennsylvania model is even feasible.

The key takeaway here is for states considering legalizing sports betting and/or online gaming to avoid pushing the envelope. The same companies that beat down the door to launch in New Jersey are hesitant to launch in Pennsylvania.

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Steve Ruddock

Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus is the developing legal and legislative picture for regulated US online poker and gambling.

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