An Oral History Of The U.S. Sports Betting Gold Rush

The fastest legal expansion of gambling in U.S. history, allowing sports betting both online and in the flesh in nearly three dozen states over a five-year period coinciding with a global pandemic, has left precious time for reflection.

Colorado’s launch of mobile sportsbooks in May 2020 proved that even if the world is left with little more than table tennis and Korean baseball, people will bet, and some will even stay up to watch. The world kept turning, and expansion may even have been accelerated by the rapid spread of the respiratory virus. The handle and revenue numbers have been staggering and the pace relentless.

Of course, this journey traces back to New Jersey and the architects of the resistance to the Professional and Amateur Sports Protection Act, the 1992 federal law that confined legal sports betting in the U.S. mainly to Nevada. The victorious legal challenge, Christie v. NCAA, which became Murphy v. NCAA when New Jersey’s governor’s mansion changed occupants, produced the historic ruling on May 14, 2018. Weeks later, sportsbooks in Delaware and New Jersey saw ribbons cut and tickets written.

Sports Handle recently conducted interviews with more than 20 figures across the U.S. sports betting landscape, including key lawmakers, regulators and policy experts, investors, sportsbook executives, media personalities, oddsmakers, and more. Their comments (which have been lightly edited for clarity) trace the first five years of legal sports betting in the U.S. while addressing the many concerns and quandaries generated in that span.

Chapter 1: “This just got a lot more interesting”

Joe Asher (president of sports betting at IGT, former CEO at William Hill US): I always knew PASPA was going to be overturned one day. Whether that was in the courts or in Congress, I was never really sure, but I always thought it was a weird statute. I mean, it’s just a weird statute, because it didn’t directly prohibit sports betting. It prohibited the states from regulating sports betting.

New York-based sports bettor (anonymity requested): Before PASPA was overturned, placing a bet was terrible. I was making wire deposits to aliases in various South American countries. It was always dicey. And nerve-wracking. And it was time-consuming in terms of getting cash and going to Moneygram. And there was always sort of a leap of faith — you’re just trusting that this will all work out in the end, betting offshore, but never completely positive. And it certainly limited my betting from what I would prefer to do — the volume of bets I would have liked to make and the positions I took — because it was such a pain to fund accounts. And if or when you cashed out, you never were positive you were gonna get your money back.

Chad Millman (chief content officer at The Action Network, former editor-in-chief at ESPN.com and ESPN the Magazine): Back in 2008, there was a Giants-Eagles game, and the Giants were playing well, and the spread did not reflect what you would think it should be, based on how one team was playing and the popularity of one team. And I just thought it would be an interesting column to explain to people not how to take a side in the game, but why this spread wasn’t as big as people thought it would be. So I called Bob Scucci, who was a bookmaker, and he explained to me why the line was set the way it was, and I thought it was really interesting.

So I wrote a column about it for ESPN.com, and the column did really well, and then someone said to me, “Hey, could you do this on a more regular basis?” And I said, “Sure.” And I started doing a weekly column about the machinations of the lines and how wise guys looked at it and how bookmakers looked at it. And that ended up becoming a daily column that I did for Insider. And that evolved into the podcast, Behind the Bets, and that evolved into doing stories for E:60 and making appearances on SportsCenter and all that kind of stuff.

Joe Brennan Jr. (CEO at Sport A.D., former director at iMEGA – Interactive Media Entertainment & Gaming Association): Really the core of why the effort to overturn PASPA was successful was the folks in New Jersey who were working on it, because they had kind of a Jersey-first attitude. They weren’t pushing for one segment of the industry or another. Neither was I — it was just, this is something that should happen, because sports betting is happening all around us. It’s the most common form of gambling in the United States, and I’m not saying that — the National Gambling Impact Study said that back in 1999, so it needed to be regulated. There had to be somebody policing it.

Richard Schuetz (veteran casino executive, educator, and regulator): In February 2014, I was asked by the KPMG folks in the U.K. to organize a presentation at the company’s Mayfair office in London to discuss the potential future of PASPA. The session was attended by about 150 people and lasted over three hours. I invited two U.S. gaming lawyers to join me, and these two concluded that the U.S. Supreme Court would overturn PASPA. This all seemed like an intellectual abstraction to me, and I did not connect it with any perceived reality. I suspect I believed, at some level, that PASPA would not be overturned. On this subject, my crystal ball was not working too well.

Brennan: New Jersey felt very strongly about the matter and also felt that Atlantic City was really operating at a disadvantage and that they had missed that opportunity. Back in 1992-93 when PASPA had been passed, there was a carve-out for them, but they couldn’t get their act together in the state legislature to pass what would have let New Jersey take advantage of it. And so now they are trying to come back 20 years later, to get another shot at that.

So this is really a Jersey-first, almost Jersey-only effort. Everybody else who’s on the bandwagon now, from the big casino companies to the leagues, was once dead set against it. And they kept saying, “This is the third rail of gaming politics, why are you wasting your time?”

Asher: When Adam Silver wrote his New York Times op-ed piece in November 2014, that was a significant moment, because it wasn’t just that you had a commissioner coming out in favor of sports betting, but it was obviously a very well-researched and informed op-ed. I mean, he just didn’t wake up on Tuesday morning and decide to write this.

Shawn Fluharty (minority whip, West Virginia House of Delegates; vice president of National Council of Legislators from Gaming States): I took office in ’15 after getting elected in ’14. I introduced sports betting legislation right out of the gate, as soon as I was elected. So that kind of got a conversation going in West Virginia, and was able to put eyes and ears on what was happening. I think by doing that, we got a head start on the conversation, and then, since it had already been churning, we had a better piece of legislation ready to go right before PASPA was overturned. So, we actually passed it prior to the court ruling.

Millman: I had a really good job at ESPN. It was super comfortable and I could have stayed there forever. Then in late April of 2017, Mike Kerns from The Chernin Group asked if we could get together and have lunch, and he was pitching me on this idea for a still-to-be-launched, built, consummated, sports betting media business.

And Mike is brilliant, and the concept was great, and it was a lot of the stuff I had always wanted to do at ESPN if we could do it in full flower, but much bigger and smarter and better than anything I could have conceived, because I was only thinking within the construct of what could be done with ESPN. And then about a month later — it must have been June — the Supreme Court had announced that it would hear the case to overturn PASPA. And I texted Mike, “This just got a lot more interesting.”

Brennan: The tide only turned on this one once the Supreme Court granted cert to New Jersey. All of a sudden, as soon as the Supreme Court accepted it, there was a 180 by folks in the industry and everywhere across the spectrum. Some jumped on the bandwagon so fast they were breaking their ankles.

Asher: The AGA got behind the legalization of sports betting under Geoff Freeman’s leadership. And I thought they did a very good job. And in large part, it goes back to Chris Christie when he decided to pursue this litigation. He didn’t just do it through the attorney general’s office. He went out and hired Ted Olson to do it. And that was obviously a significant step, because you got one of the most skilled Supreme Court lawyers in history on the case, opposite the former solicitor general of the United States.

So it was all these little things, I think, that kind of led up to the decision to ask the solicitor general for his opinion and then the decision to grant cert. And obviously at that point, the writing’s on the wall.

Stacie Stern (VP government affairs & partnerships, Underdog Fantasy; former FanDuel government affairs director): I think the perspective from FanDuel Government Affairs was, obviously, continue to work to make sure that fantasy sports contests were clearly defined and legal in as many states as possible. But this sort of, I’ll say pipe dream of, “Maybe sports betting could be coming soon, we’re hearing rumors,” and what impact that would have on the business, I didn’t take very seriously until, really, right before PASPA was overturned. And I thought about how that would change my day-to-day.

The focus for me had always been fantasy sports and evangelizing about those contests. And then the question was, “Are you comfortable doing the same thing and making the ask and evangelizing for legal sports betting?” And the answer was a resounding yes.

Fluharty: When West Virginia was pushing sports betting, the pro sports leagues came in at the 11th hour and basically tried to strong-arm us and held a closed-door meeting with the West Virginia Lottery. There wasn’t any shortage of fireworks. We were going to be one of the first states up and running, and they wanted their “integrity fee,” they wanted official data, they wanted all these things, and they acted like, “Oh, hey, if we don’t get these, we’re going to strong-arm you. And also, we should have the ability to opt out of sports betting.” That was one of their demands!

Chapter 2: “We won”

Brianne Doura-Schawohl (CEO, Doura-Schawohl Consulting; problem gambling policy advocate formerly with the National Council on Problem Gambling): To say we were monitoring the case closely may be an understatement. We may have not known what the future held, but we knew that this would likely create the largest expansion for gambling in our nation’s history.

Brennan: I was mid-flight to Las Vegas that morning and I was using the plane’s WiFi to doom scroll. I wasn’t expecting the ruling yet. Everybody thought it was gonna be like one of the last rulings in June or something like that. So mid-flight, a congressman calls me up, Rep. Tom McMillen of Maryland. He’s like, “Hey, I just wanted to call you to say congratulations. It’s such great news. What a fabulous victory.” And I was like, “You know, all due respect, congressman. What are you talking about?” He’s like, “Oh, they just released the decision, the Supreme Court overturned PASPA, you won.” And the flight attendant comes up, and he’s like, “Sir, you can’t take calls on the flight.” I’m like, “Can I just have a minute more? Just a minute, please.”

Ray Lesniak (Former New Jersey state senator, president of the Lesniak Institute for American Leadership): I was in the locker room at Suburban Golf Club, right by my house, getting ready for a round. And I got a call from Dennis Drazin, one of my partners who actually believed in me. He’s the president of Monmouth Racetrack. Dennis said, “We won.”

Asher: We had done the deal with Dennis a number of years earlier and with the idea that we’ll have a sports bar at Monmouth Park and people can bet the horses in it, and one day this will be a sportsbook. And we had no idea if that day was going to be in 2018 or 2025.

Lesniak: After I spoke to Dennis, I spoke with Joe Brennan — he was the other one who believed in me. I never got out to the golf course that day because I spent the rest of the afternoon making calls.

Chris Grove (sports betting industry investor, entrepreneur, speaker): I was at the W in Chicago, downtown by the lake, and I spent part of my morning eating breakfast, and then the rest of my day three quarters of that breakfast sat on the table getting cold. I took basically a series of back to back to back to back to back to back to back to back to back phone calls from media members over the course of the next 10 hours.

Todd Fuhrman (former oddsmaker, co-founder Bet the Board podcast): I was out walking my dog early in the morning on the West Coast and had my phone on silent. Ended up getting back to the house and saw that my phone had completely blown up. So, obviously, you’re thinking the worst-case scenario — that a friend or a family member had fallen ill.

But lo and behold, it was all my friends, colleagues, media people asking for quotes, knowing that PASPA was gone and trying to figure out what it was going to mean to the sports betting landscape. First call, I think, was [ESPN reporter] David Purdum. He was scrambling to get a lot of responses, and we had had a ton of back and forth at that time in terms of how everything was fitting together.

On Oct. 28, 1992, President George H.W. Bush signed the Professional and Amateur Sports Protection Act (PASPA) into law, banning states from legalizing sports betting.
Today, May 14, 2018, the Supreme Court found the law to be unconstitutional.

— David Payne Purdum (@DavidPurdum) May 14, 2018

Grove: Job one for me was helping our friends in the mainstream media properly contextualize the story to the greatest degree that I was capable.

Doura-Schawohl: There was a lot of misinformation out there in the immediate aftermath. Some people thought and reported that, oh, this instantaneously meant legalization was going to happen overnight, and there was a lot of inflammatory, inaccurate information. So we were really trying to gain control of the narrative, a true understanding of what was going to take place.

Grove: Job two was, how do we maximize this opportunity from an affiliate perspective? Look, at Catena Media, we had been preparing as if the decision was going to come down this way because there was very little reason not to. It’s not as if it cost us a terrific amount of money. And obviously we’ve been following the issue closely enough and had talked to enough people that we felt like it was more likely to happen than not.

So for us, it then became about asking the question of, now that the decision has come down, what’s the likely order of states? Who’s going to be in that first wave, and what can we do to maximize the opportunity from that first wave of states? Obviously, that story started with New Jersey, and then after that it became a little bit more of a guessing game of who’s going to be willing to go quickly on this.

Brennan: We were halfway through the flight, and I’m like, “Oh my god, what’s it gonna be like when we finally touch down?” I was flying out to Vegas to talk to more people about what we do in case the Supreme Court comes back. There’s some folks concerned with what happens if we swing and miss, thinking maybe it was too early. If you swing and miss, do you prevent another cut at this for a generation or so? People forget that it was far from being considered in the bag.

Stern: I remember specifically texting with Corey Fox, my FanDuel colleague, and constantly asking for updates as he heard them and what the word was. That was a huge day. I personally don’t think that I understood the magnitude until some months later. I don’t think I could fully appreciate just how big it was and just how quickly things would move.

Millman: I’m fairly certain the first text I received was from my mother-in-law who was really just congratulating me, but also in a backhanded way saying, “You’re lucky you didn’t mess things up for my grandkids.”

Fluharty: I sent a lot of told-you-so’s to a lot of people.

Ryan Rodenberg (Florida State University professor, author, and researcher): As soon as the ruling showed up on the SCOTUS website, I immediately turned to the conclusion and read it first. It was at that point that I immediately knew state-regulated sports betting would be spreading quickly in the U.S.

Joseph Stauff (institutional investment analyst at Susquehanna International Group): I just knew that without PASPA, it’s essentially going to take what is an amazing business model of casino gambling and migrate it online, so that’s when I raised my hand. I was like, “I’ll take that sector.” I think the premise was more about, wow, this is the last significant industry in the United States that really hasn’t been disrupted by digital migration.

Fuhrman: It was a watershed moment for those of us that had put in our time behind the counter and thought there were going to be all sorts of other opportunities, not just from a content creation standpoint, but a proliferation of business across the odds-making side and extensive offerings that had only been available essentially in Nevada.

Jack Andrews (pseudonym for professional advantage gambler/co-founder of Unabated.com): I sent around the meme of Mel Gibson from Braveheart. “Freedom.” You know, because it felt like freedom. Let’s take the wraps off this.

Fluharty: Happy PASPA Day! I still celebrate it every year.

Chapter 3: “It was dark, and then it wasn’t”

Stern: PASPA getting overturned meant kind of a shift. I remember I was asked if I was comfortable with certain conversations with lawmakers, stretching from fantasy sports to sports betting. And in the case of New Jersey and West Virginia, online gaming and online casino as well.

Dave Sharapan (veteran oddsmaker, co-founder Bostonian Vs. The Book podcast): After the Supreme Court decision is when somebody rescued me — rescued me by offering me a job in Wheeling, West Virginia to be the sportsbook director there. And I went to West Virginia at the end of August. The court ruled in May, and things happened really fast. I initially said, “I don’t know.” And then they really couldn’t find anybody that would say yes. So that’s when I picked up and left.

Lesniak: I expected sports betting to begin very soon after the court ruled. I was disappointed that Delaware beat us to launch. But New Jersey went soon afterwards and I made the first winning bet, on France to win the World Cup. Governor [Phil] Murphy made the first bet but lost his World Cup bet on Germany, as well as his wager on the Devils to win the Stanley Cup.

Former, longtime NJ senator Ray Lesniak speaking. Celebrating giving NJ economy “shot in the arm.”

“We saw great results already in only two weeks. By the way I bet on France to win the world cup at Monmouth.” Here at @TheMeadowlands pic.twitter.com/OQiGVXa0VB

— Sports Handle (@sports_handle) July 14, 2018

Grove: I think it’s often overlooked how fast this happened. Really, it was a light switch. It was dark, and then it wasn’t.

Asher: We always thought it was going to get going pretty quick. I don’t remember the specifics of our projections, but we were pretty bullish that it was going to spread very fast. That wasn’t a surprise at all. Because look, there’s this massive black market for sports betting that we’ve been talking about for years. So you knew it was there, and once the people in one state started and sports leagues were going to get behind it and involved in it, there would be momentum.

Stern: We traveled all the time. We were willing to take meetings and help educate lawmakers whenever, wherever. And there was interest. I mean, look, it’s sports betting, and it had something to do with sports, so it was maybe a little easier to get the attention of the lawmakers. But on the other side of that, there were also a lot of people who were skeptical and not going to be convinced about any sort of gambling at all, that it was going to be OK — on both sides of the aisle, opposition from both parties.

While it was bipartisan in a lot of ways, there was also, I’ll say, bipartisan opposition, and [we had] to fight through those and explain why it was best for the state, not just for the revenue. The revenue was one piece of it. But I always go back to just the ability for people to play in a safe, regulated market.

Grove: Even though I think those of us who were watching the story closely had a better understanding of how swift the impact was going to be and how quickly sports betting authorization was going to spread across the U.S., at least speaking for myself, I still underestimated just how rapidly it would occur. And I suspect a number of other folks did as well.

This still represents, as far as I’m aware, the single fastest expansion with legal gambling in the history of the United States. And it meant that as things moved that quickly, that first wave of states, and arguably even in the second and third wave, were all assembling the plane mid-flight, because it’s not as if they could look back on a rich body of experience of other states.

Jay Kornegay (vice president, race & sports operations, Westgate Las Vegas Resort & Casino): We didn’t know what the regulations were going to be in these new states. We knew that there were going to be a number of different views on how certain states were going to regulate legalized sports wagering. We knew that because there was a number of regulators from various states who came in and toured and talked to us and wanted to gather our thoughts on operations and so forth.

And speaking to various groups that came in, we knew that there was going to be a variety of ways people were going to run their sportsbook in their particular state. New Jersey was saying, we’re not going to allow wagering on our schools. Tennessee coming in and saying operators have to guarantee a 10% hold. I mean, there’s just so many different views, and I felt like they could have used our experience a little bit more, and I think you’re starting to see that now, where a lot of them are starting to migrate to what we have done here for years.

Brennan: I thought that the Nevada casino companies would have an advantage because they already had legal sports betting operations, right? Caesars, MGM, Station, all of them. The expectation I had was that those guys would come to dominate because they already had deep databases of real-money gamblers, and they’re already licensed everywhere. They already had all the compliance experience.

It was very difficult for people coming from outside of the gaming industry to truly understand just how much of a hurdle it is from a cost perspective, from a regulatory clearance perspective, to get into the U.S. gaming market. And so I thought they would have an advantage. And it was assumed that William Hill was gonna be far and away the biggest and the best because, you know, they had come in from the U.K. and they blanketed Nevada, they took over Nevada. Joe Asher was very aggressive already in getting deals in New Jersey. He really early on was thinking about what happens the day after PASPA gets overturned.

Andrews: I really thought that the Vegas corporations would quickly mobilize and open up shop all around the country. And my reasoning for that was Joe Asher with William Hill — he was very proactive in all of this. From the very beginning, he had opened up shop in Delaware already for their parlay cards. I figured he’s going to mobilize. MGM’s got a ton of money, they’re going to mobilize too. Caesars will mobilize and, in short order, it will be dominated by these U.S. casino corporations who will make sports betting, largely as they do in Vegas, just sort of this side, complementary piece that’s offered to people.

Brennan: Everybody thought it was William Hill first, and then everybody else is playing for second. So when FanDuel and DraftKings absolutely run everybody over and they didn’t have a lick of sports betting experience between them, it was amazing. It really was amazing. But it showed, well, you can have the experience like all of the U.K. companies had and the Nevada companies have, and you can have all the regulatory pieces already in place, but you just can’t beat having a database of a few million people who have already given you money, who can just log on with their DFS info.

Andrews: Obviously, we wouldn’t be where we are if states didn’t want to make this a competitive marketplace — if everybody followed Delaware or everybody followed Rhode Island. Otherwise, there might be one to three operators per state. It was New Jersey being influential in saying, “This is going to be a competitive marketplace.” That was huge. Not all states obviously have followed suit, but you can point to New Jersey for being a key part of the reason that multiple operators are encouraged in a lot of states.

Lesniak: Until New York legalized sports betting, there were more cars with New York license plates at the FanDuel Sportsbook at the Meadowlands Racing Track than New Jersey license plates.

Sharapan: I was in Vegas from 2004 on and we had been hearing about the possibility of nationwide expansion for five years and going no, no. And then it became very real, and all the old timers were like, “This is gonna open up everything.” Like, people were talking about what state they would like to live in. And the way it was sold to me was to go open West Virginia, and Pennsylvania is next, so you’ll just transition to Pennsylvania, and you’ll be able to run a sportsbook in your hometown.

In Wheeling, I was 45 minutes from the house I grew up in, and I thought this was perfect. And then Pennsylvania. Well, well, “prodigal son was returning home” is the way they kept telling me. So it was very positive, and a lot of people saw opportunity. It was — it was gonna be good. And then, after a year, it wasn’t. It wasn’t gonna be good. Not for Nevada guys. And why is that? Well, because, you know, the discussion became pretty quickly that the Nevada model was dead, that American guys don’t know what they’re doing.

Ed Golden (founder, Right Angle Sports handicapping service): I kind of wish we were more aggressive in the early going with betting in those early days in the regulated states, but we really weren’t ourselves. But it slowly grew and grew, and there were a lot of opportunities for pros and semi-pros. So Right Angle has seen its own clientele grow in these past five years as well. Especially the last three.

New York-based sports bettor: These legal betting apps are amazing. You know, just in terms of ease of access, funding, reliability, the interface with the betting companies. I just think the technology is fantastic. It’s great having several books to choose from. Honestly, it could not be easier. It takes me seconds to fund the account. The apps are seamless, and it’s right there on my phone. I could pull it out of my pocket and make a bet within a minute as a result of all this.

Sharapan: I’m amazed at the in-game product. I tested it way back in 2013. It wasn’t ready for market, and we didn’t put it up right away, and then we put it up a little bit later. But I was fascinated with it then, I’m fascinated with it now. I would prefer to play stuff in-game than pregame anymore, because I kind of know what the numbers are going to be if a certain situation arises.

I’m amazed at the fluidity of it, the options. I mean, in-game betting props, the fact that they come up, you know, like the Steph Curry points-scored prop that adjusts during the game. He hits three threes in a row and it closes at 27.5, and in-game now it’s 38.5 with juice. Now the juice isn’t always fair, but I’m amazed. And I don’t know if it’s a good thing. Too much product isn’t always the best thing. But man, I’m fascinated with the in-game.

Chapter 4: “This isn’t your grandmother’s type of gambling”

Asher: I probably didn’t see the firmness of the sports leagues’ embrace of sports betting coming as quickly as it did. And [NHL Commissioner] Gary Bettman had a great line: “What changed your mind on sports betting?” “The Supreme Court did.”

Andrews: The leagues doing a 180 is probably the most influential thing when it comes to the growth of sports betting.

Fluharty: I think when you look back from day one, when the pro sports leagues were pressing hard against it and making demands, and you look to today, what has changed the most is having the league buy-in. I think that really solidified its place in America and put the stamp of approval on it. And I think that sparked the change in how it’s now perceived as commonplace, and not necessarily adversarial.

Asher: Keep in mind, only a couple years earlier these guys submitted affidavits in court under oath talking about the grievous harm that’s going to befall their sports. And to go from that to, I mean, the NFL logo is on the Caesars building here in Las Vegas now. You get an email from somebody at Caesars, it’s got the NFL logo on it. So yeah, clearly the support of the sports leagues and teams has accelerated it — so much so that the teams started lobbying to get licenses in a number of states. In Arizona they’ve got licenses to operate.

Doura-Schawohl: When I started to see these incredibly influential entities attaching themselves to sports betting, I knew that this was just not another form of gambling. This isn’t your grandmother’s type of gambling. You’ve never heard of a bingo hall attaching itself to the NFL or the NHL. Here I am in D.C .and I’m in the city with the first sportsbook lounge in a stadium and the first jersey with a sports betting logo on it. To me, the change in trajectory happened when we started to see overly aggressive business relationships.

Stauff: There’s two things essentially to pull forward consumer acceptance of the product, from what was perceived to be somewhat taboo to really a mainstream mass-accepted product. The industry benefited really from the effects of COVID and the shutdown, and states approved legalization much faster than expected because they needed alternate sources of tax revenue, because they didn’t know what the heck was going to happen. It really was both consumer acceptance and state legal acceptance driven by the incentive for more tax revenue. Those are by far the two biggest things, and that largely was accelerated by COVID.

Millman: When the sports leagues shut down, it was super challenging. And we did all the things that every business was doing. People were let go. We had salary reductions, like everything we could do to conserve cash. But we also felt good that sports would come back eventually and we had proven the model, and so we would be able to cycle growth quickly.

And what happened was, I think Colorado sportsbooks launched in May 2020, and that drove a tremendous amount of affiliate business. The PGA and UFC came back and that drove a tremendous amount of revenue. So we were hitting the numbers we expected to hit from our original budget when there really weren’t many sports. And then July baseball came back and NBA came back and then football, and so it just accelerated.

Chapter 5: “Those guys had singularly the greatest asset possible”

Fuhrman: One unfortunate part of all this is that Nevada, which was at the forefront, has really lagged behind with some of the availability of different line offerings, the tech platforms, and a number of other aspects. So from being the leader of the pack for all those years when it was only legal here in Nevada, we have since kind of fallen to the bottom of the scrap heap in terms of extensive menus and some of the availability that the rest of the country currently has.

Schuetz: After the repeal of PASPA, things seemed to change. I believe the traditional casino firms in the space were low on the learning curve concerning using the Internet to deliver gaming products. This slowed them down. The traditional U.S. firms were also bureaucratic and cautious in navigating the regulatory landscape.

Andrews: And what happened? Of course, the European companies came in and ate their lunch, and they also made sports betting a much broader buffet than previously had been offered in the United States.

Sharapan: The discussion became pretty quickly that the Nevada model was dead. That the European model is the lifeblood of the whole business. They brought everything from over there and told all the legislators and lobbyists and sportsbook companies that their model was the best. And they were able to get in and tell everybody, and that’s just the way it went.

Schuetz: DraftKings never seemed to fear or respect the regulators and operated with an attitude that they would push full speed ahead and apologize later — if need be. Much to my dismay, this worked. The regulators no longer acted as the guardians and began shifting into the facilitators. DraftKings was also a smaller company with a very non-bureaucratic structure and was good at marketing for the new virtual world of delivering betting products over the Internet. They also had insights regarding the younger gaming market acquired from their DFS business. All of this explained their rapid financial growth during the early years of legalization.

Andrews: I think there are two ripple effects: One, these European companies being far faster to act than the U.S. companies, and, two, the surface area of sports betting growing exponentially almost overnight. Those are two ripple effects that we’re still kind of grasping with five years later.

Stern: There was a thesis that we believed at FanDuel — that people who played paid fantasy sports contests, sports fans, were more likely to bet on sports. And that’s really what the directive of the business was. But I don’t think anybody saw the market share being what it is. It’s a testament to the product that FanDuel has built.

Brennan:  FanDuel and DraftKings had deep databases of players that had already registered and deposited money. That is singularly the only reason why they are ahead. It’s not their product or anything other than that they already had the players.

Kornegay: There’s different strategies. You have some of the bigger operators out there spending millions of dollars each month to obtain, mainly, recreational players. And then you have others that are very thrifty with their marketing resources. They’re treating it more like a marathon. I’m not sure exactly which one is wiser or more successful, but time will tell.

Sharapan: Nevada guys didn’t have much of a shot. I know a couple of bookmakers that went to different places and either stayed for a little while and transitioned to a different career or are on the constant move. Once you get to a state, there’s only so much you can do, and you have to either, you know, move or get out of the business. I got one guy that I worked with at the Venetian. He’s on his third city stop. He went to upstate New York, then down in Florida, and now I believe he’s in the Midwest somewhere.

Brennan:  If you remember, before PASPA those guys were on fumes. Wasn’t DraftKings on like their series double-Z round for financing and they’re just blowing dust over there? To the point where they tried to merge with FanDuel? When you look at, like, 2015 and the New York Attorney General’s office and how that chilled the fantasy industry for everybody but them, allowing these guys to then become this leviathan really wasn’t fair. But they kept treading water just long enough so that when PASPA was overturned, those guys had singularly the greatest asset possible.

Stauff: The more notable event around the time of the PASPA ruling was Flutter’s acquisition of FanDuel. And then, there were some other transactions that happened subsequent to that, meaning MGM and Entain. They created BetMGM via a joint venture. That’s what registered among most investors or analysts or people that look at stocks all day — the triggering of deals and transactions at the time.

Grove: DraftKings’ SPAC in April 2020 was monumental. You can look at it now and people are critical of DraftKings now in a much different way, and I don’t think most of those criticisms are actually valid or deserved. But what I don’t think can be debated and is often forgotten is that DraftKings’ SPAC transaction really provided the focal point for retail and institutional investor interest in legal sports betting in the U.S. Without that, you really would not have had another way for those pockets of capital to express their interest in the U.S. sports betting opportunity. And without that expression of interest, I don’t know that we’d be where we’re at as an industry today.

Now, of course that interest ballooned, bubbled, and then receded. So it can be easy to dismiss its impact or just forget that it happened in the first place, but that was a big deal. Retail and institutional investors taking this opportunity seriously provided not just an infusion of capital, but — and this part is critical — it provided a validation for the online gambling opportunity that had been missing before for the CEOs of MGM and Caesars, anyone on the retail side. They had not gotten that feedback from investors previously that digital mattered. And so as a result, digital did not matter. Until the market said it should.

Schuetz: Now DraftKings is in the “show us” phase with the financial markets. They seem to specialize in continually losing serious money quarter after quarter, resulting in the shedding of billions of dollars of capitalized value. DraftKings suggests it will stop the cash burn at the end of this year. I would take the over.

I’m also old school in my spirit and find myself uncomfortable with the DraftKings betting model to limit the sharp play and leverage the stupid. I was involved with casinos that offered real books, especially the Stardust. I sense that this older model is more sustainable. There seems to be much more hustle in the modern business models of many of the participants in the betting space, and I sense that this may not end well.

Chapter 6:  “The greatest threat to the industry is the industry itself”

Stern: Right now, I’m probably most concerned about our reputation. As online operators, I think that is really important. It feels like we’ve taken some hits. Responsible gaming is obviously very important. And I think that the operators are authentically looking at, “How do we do this in a meaningful way and do the right things?” And advertising is a big piece of that as well.

Fluharty: I think consumer protection is the next wave of legislation you’re going to see. So, for instance, we actually pushed a couple of pieces this past session, one regarding the advertising that’s going on in this industry, which certainly at this point has no real checks or balances on it, and we had a bill that was related to having an independent evaluator look at the influencers and third-party affiliates of these sportsbooks to make sure that they’re operating on the up and up, that they are a trusted source and they’re not selling snake oil to the consumer.

Fuhrman: Look at a traditional sports broadcast as a litmus test for everything that’s going on: You’re not going to have somebody that doesn’t have any officiating experience in the booth to fill the role of a Gene Steratore or a Mike Pereira. Yet, suddenly for the sports betting space, people that don’t have a background in it, whether it’s as an oddsmaker or a professional bettor, suddenly are given larger platforms to speak about it and push some of the misconceptions that are out there and not necessarily the best practices.

Golden: We didn’t know what legal sports betting in the U.S. was gonna look like, and there are a lot of people who thought it might make things worse. It still kind of remains to be seen. We hear all the time about people getting limited very quickly if they show any aptitude whatsoever.

Sharapan: I was around sports betting when I was a kid and none of it was legal, but I was around it and you knew the dangers of it, you knew the responsibilities of it, and you probably knew the bad parts way better than you knew the good parts. But the content space, anybody with a phone, especially these new phones now, can put out a bunch of bulls**t. And I think we have to be so aware.

I’m conscious of it every time I hit record, every time I go on a show to try to be aware that somebody might be hearing this message for the first time and to be responsible for what I say and not just kind of flippantly say stuff. It’s money, it’s real life, and I’ve seen the bad part of it, too, and that’s the part that I’m most concerned about going forward.

Furhman: I think we’re in a dangerous area where you have a lot of people that really don’t have any business talking about sports betting in any capacity being given larger and larger platforms. And I’m a little bit scared about what that means going forward.

I think that’s my biggest fear in all of it because when we look at the proliferation of legalized sports betting, I mean, we’ve seen firsthand how the operators are leaning into higher hold products that are out there. You run the risk of overfishing a pond and trying to create a generation that’s filled with problem gamblers more so than teaching them to fish and understanding that, hey, look, we can offer a smart, thoughtful, competitive content platform knowing that bettors over the course of a long haul are going to struggle to turn profits.

4 years ago today a 7-year long match was won by the score of 7-2 and PASPA was finally defeated.

Here’s what I wrote to a group of fellow bettors that day (I had less than 50 followers on this site back then). A lot came true. 🧐 pic.twitter.com/DWbSyeZkJO

— Captain Jack Andrews (@capjack2000) May 14, 2022

Stauff: We can follow how the U.K. market has evolved and the issues that it’s had to deal with, and in Australia as well, and they’re all the same. They’re all the same. It’s taxes and tax rates. It’s how much advertising or how free the advertising is. And it’s a real thorough focus on problem gaming. Those are the three inputs, and that’s not a function of some New York senator’s parochial argument.

Stern: Now, because of maybe some of the missteps that we’ve seen, some of the promotions that we’ve seen, I think we as an industry need to continue to have discussions. And I know there are coalition and industry discussions occurring, but it feels like some of the regulators really need to see action and changes. And we don’t want them to feel like they have to overregulate or set up even tighter guardrails that might be difficult for us to operate within. So we want to do the right things.

Brennan: With the knowledge that we have now, I would definitely have gone back and pushed for the legislation to be explicit about the restrictions on advertising. New Jersey and other gaming regulators very tightly regulate what brick-and-mortar casinos can feature in their advertisements, TV, print, whatever it may be, from the type of language that they use to the way gaming is portrayed. And my assumption at the time was that [online] would just fall under the same standards, right?

When online casinos were legalized in New Jersey in 2013, it didn’t get crazy. I mean, I remember being at the Newark train station and all of a sudden those are 888 print ads up on the side of the ticket counter and I’m like, wow, imagine that. And at the time I was like, “I did that, right?” But when the sports betting advertising just got crazy out of the box — and again, it was unfortunately led by the DFS companies, and they had already gotten into that advertising war of attrition in DFS, and it started getting them in trouble, and it was like they did not learn their lesson. My assumption was that the advertising standards would fall under the same regulations. I guess I was wrong. I’m not faulting the regulators for that.

Fuhrman: The one thing that’s been a little bit different than I expected, I thought we would see advancements made in terms of liquidity and sportsbooks willing to raise their risk threshold. If anything, I feel it’s been diametrically opposed to all of that, because with these publicly traded companies and a lot of the misinformation out there, you’ve seen a lot of operators gravitate towards higher hold markets trying to run what they deem to be advantaged customers off at a much more alarming clip than I ever thought possible.

Sharapan: From an internal standpoint, I’m so discouraged by what’s happened with guys that I know and respect and have done the job, and the lack of opportunity, let alone the lack of good opportunity. Because everything is becoming automated and folks are just relying on feeds. Prices are getting worse, not better. The big companies spend a zillion dollars in advertising. So the little companies just aren’t going to make it. You see the percentages in every state. I mean, there’s two or three books that have 85-90% of the market and everyone else is competing for the remaining 10%. Can’t survive.

Brennan: People are saying, look, it’s all about customer acquisitions now, worry about monetizing later, the genie just got out of the bottle. And in a lot of ways, it became exactly like the U.K. market that is going through its own internal hand-wringing right now. And one of the things that they had cautioned me, “Joe, you know, those guys get over here, they’re going to go through just an acquire-and-burn cycle with players. They’re gonna get them in with real aggressive ads and then they’re just gonna burn them out. They’re gonna squeeze every last dollar out of these people. And that’s not gonna be good for the market.”

Andrews: The single greatest threat to the long-term health of the U.S. sports betting industry is the industry itself. I mean, honestly, this is an industry that feels like it is racing to the bottom. And I’m not just talking in terms of profitability. We’re not trying to do sports betting in any way that is sustainable. At this point, we’re trying to extract too much money from the consumer. We’re leaving a bad taste in their mouth. We’re gutting the fish, and that is going to have a ripple effect.

You can see sports betting becoming just this carnival con game like it is in some other areas of the world where you are not expecting that sports betting is something you can beat with skill. It’s like, why would you even try? There’s no way you’re going to get paid if you do win at a game like sports betting, and the ripple effect is gonna be because all of these operators are obviously trying to transition into iGaming. And if you lose their trust in something as transparent as sports betting, then you have no shot of gaining their trust in something as opaque as casino gambling done on the internet, which people already have a high level of mistrust in. So they’re really, really creating a very hard path for themselves going forward by not dealing a sustainable product in terms of how they approach sports betting.

“They’re price gouging their customers, to put it mildly, jamming parlays down their throats…” — Jeffrey Benson@CircaSports‘ own @JeffreyBenson12 with a 🔥 quote in the @WSJ.

Online Sports Bettors Lose More as Parlays Gain Popularityhttps://t.co/jRLdATlTc5

— Alfonso Straffon 🇨🇷🇺🇸🇲🇽 (@astraffon) May 7, 2023

Schuetz: I worry that the regulators do not really understand what they are regulating. Few know about sports betting, and even fewer have any experience in dealing or regulating it. Moreover, after legalization, the politicians need to quiet down and leave opening dates up to the regulators. Markets should open when the regulators are comfortable in being able to execute the legislature’s public policy mission with a high level of integrity and competence. Not before.

Brennan: The way that folks in the sports betting industry who wanted to go live were so adamant about saying we have to go live before football season — Arizona passed their sports betting law and then like four months later they were going live. That’s ridiculously fast. And a lot of it is just dumped in the lap of the regulators. The regulators are like, ,”Oh man, how do we handle this and that? Responsible gaming and KYC and anti-money laundering and all the background checks.” And then all of a sudden now you’ve got sportsbooks, and they’re just going to go out there and they’re gonna saturation-bomb the airwaves because they’re going live all at once.

Schuetz: In short, we need to fix the regulatory model by securing better-trained and experienced human resources. We really need to work to keep the politicians, lobbyists, and political consultants less engaged after legalization, especially since there is such potential for conflicts of interest between what they want and what is in the public good.

Doura-Schawohl: The reality is the industry and the regulators and pretty much all the stakeholders really need to grow up. I feel as though this all happened so quickly, so aggressively, and with frankly little consideration and respect for the potential harm and negative consequences. We were already working from an underfunded, fractured problem gambling infrastructure, that really could barely withstand the brick-and-mortar traditional gambling and problem gambling problems the country already was facing. It was like we poured kerosene on an already percolating problem, and it’s a public health problem.

This isn’t an individual problem. It’s a family problem, it’s a community problem, it’s a national problem. I think that’s the biggest crisis right now, and I don’t think we have to look any further than the U.K. with the White Paper, that there are serious consequences to both the consumers’ public health and, frankly, industry sustainability by continuing to neglect problem and responsible gambling as part of the ecosystem.

Schuetz: I think this is a function of the fact that it used to be between the regulators and the industry, and there was an element of respect and/or fear there. Now, the politicians, lobbyists, and political consultants are in with both feet. They will basically say and do whatever benefits them financially or professionally, and to hell with the public interest. There has been a lack of emphasis on reality and the truth — and an incredible emphasis on spin. I am not suggesting that there haven’t always been bad actors, but I find this new crew leaning dangerously toward soullessness.

Grove: The U.S. sports betting industry, the thing is, and this is probably going to get me into trouble — which is the best kind of quote for you — the thing I would like to see in the year ahead from the sports betting industry in the U.S. is to start punching back. I think that the industry, the sports betting industry, has been far too willing to accept blanket criticism as part of the price of being a gambling product. And I think that posture has allowed unfair and in some cases grossly inaccurate narratives to take hold, all to the detriment of what is not an inherently pernicious, counterproductive, or destructive activity. I’m not sure why we take so much of this lying down, and I think we should stop.

Chapter 7: “We love to gamble on sports”

Your Top 10 February #SportsBetting handles by state: pic.twitter.com/5RqyWTgyp3

— Chris Altruda (@AlTruda73) May 11, 2023

Rodenberg: The Supreme Court’s decision on PASPA represents one of the rare rulings where the losers were quite happy to have lost the case.

Fluharty: I was super proud for us to be on the front line of something for once. Usually, in West Virginia, we’re last in line.

Lesniak: I wish the Atlantic City casino industry would either give me a gold watch or erect a statue at the front of Atlantic City.

Stern: I think you go to college anywhere in this country, you go to any local tavern or pub, it was always clear to me that people love to wager — with each other or with an app that had no oversight whatsoever. And I don’t think people care. They just wanted to be able to enjoy the game that they were watching, or games plural, and have some sort of action. So in my mind, it was then important to make sure that we had clarity and legal definition and rules and regs for oversight and consumer protections, so that people could continue this activity that we clearly know they love, and do it in a legal, safe manner.

Golden: Many of the regulated books, they do limit quickly and all that stuff. But if you’re a pro and you’re able to get multiple accounts, and you get beards and scale your betting, the opportunities that these books have provided in the past two to four years have been, I would say, unprecedented, as far as the type of bets they take before you get limited. And this is all in the context of that — before being limited. But the amounts they take on the type of markets, they take, like, a college basketball game total the night before, they’re taking bets on those, real size bets, and it’s led to a lot of pros being able to make their bets and get down the amount they need earlier than ever before.

It used to be that you’d have to wait until the morning of the game or early afternoon before the limits were high enough and enough places had the lines up for you to make the bet in the size you wanted to bet. Now, utilizing these new outs, people have been able to go a lot earlier overnight, or super early in the morning, so it’s led to a much more competitive marketplace.

Stern: I still think we’re in our infancy as an industry. I know it’s been five years now, but the build-out of all of the products, and then RG tools as part of that and responsible advertising as part of that, strides have been made. But I think we need to continue to make further strides and continue to innovate in those areas so that we’re actually doing the right thing for the consumers who are using our apps, using our products.

Millman: It’s five years that feels like 50 years and five minutes at the same time.

New York-based bettor: Previously, I may not have been open in normal conversations about my sports betting because it was offshore or otherwise not legal. Now I find myself having conversations every week or weekend with people who also bet and it’s, I think there’s much less of a stigma attached to it and it’s been a normal sports discussion now, whereas five years ago I really wouldn’t bring it up in conversation.

Kornegay: I mean, we knew that sports betting was going to be very popular. I just didn’t know it was gonna be this popular. The numbers are staggering, and they continue to go up, and I still believe that we’re in the infant stages of this growth, and that’s very exciting to us.

Fluharty: Today there’s a big DraftKings logo on Fenway Park on the Green Monster. So, I think it’s pretty safe to say that things have changed.

Lesniak: The only thing that surprises me is that not even more states have legalized it. We love sports, and we love to gamble on sports. It’s just as simple as that.