On Monday, 14th May, in Washington, D.C. a paramount decision by the U.S. Supreme Court struck down a 26-year old Federal law, that banned (with few exceptions) sports wagering and betting across the United States.
The decision sent shockwaves across mid-town Manhattan and greater part of the world. All five US major leagues - Major League Baseball (MLB), National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), and Major League Soccer (MLS) - and their franchises, were put on high alert because of the ramifications this decision will have in terms of the integrity and governance of their games, as well - and most importantly - regarding their businesses.
Beyond any ethical consideration in regards of integrity, what the 1992 Professional and Amateur Sports Protection Act (PASPA) precluded in business terms in the US, was the active participation on American professional and collegiate sports in a global industry that moves an estimated US$210 billion a year, legally abroad.
If we look at integrity, PASPA also enabled an illegal sports wagering market that, according to the New York Times, amounts to US$150 billion a year in the United States alone. The obscure nature of illegal wagering has definitely made very difficult the policing and control of the gambling activity, especially in what referred to the possible impact it had in sportsmen being 'on the take' to fix matches across the country.
There’s a long history of notable match fixing cases, as recent as the 2007 NBA referee Tim Donaghy case, going back to the 1919 Chicago 'Black Sox' scandal. As a matter of fact, what we know now as the commissioner’s role and office were created by MLB in 1920, as a direct result of the 'Black Sox' scandal. In time, all North American sports organising bodies followed suit.
Contrary to some that exercise fast judgement, I’m certain that working in partnership with global sports wagering operators is not only a great business opportunity, but the safest way to defend the games’ integrity. The operators are the most interested party in keeping it clean, because illegal, obscure and black market betting affects their bottom line directly. But it is on the American rights holders to attack the opportunity headfirst, as they are the closest stakeholders to the lawmakers that will legislate to regulate sports wagering, with the advantage that they can - and must - go into the process with a deep knowledge base of how this industry operates elsewhere, especially in Europe.
In marketing terms, an industry with a total revenue potential of US$500 billion a year, has a lot to say in terms of advertising and safe wagering advocacy. And that’s where the North American and European sports business industry is veering its ships in the upcoming months.
Global players like GVC-owned BWIN*, Ladbrokes and Sportingbet, are at the forefront of creativity in marketing communications, as well as sportsbook quality and integrity, and that shows in any partnership they have executed in myriad sports in Europe during the last decade. Important sums to reward the rights holders via sponsorship fees, and equally important sums invested alongside the same right holders in integrity systems and procedures to fight match fixing.
Nevertheless, the spark in interest into the whole of the betting industry ecosystem is not new in the US, with data at the core of any development for the future. Swiss sports data giant and WWP Group strategic partner, Sportradar AG, made a play in the US in 2015 when it established its American subsidiary by taking in muscle and investment from none other than Michael Jordan, Ted Leonsis and Marc Cuban.
That positioned Sportradar at the forefront of the data and media businesses, which has consolidated their current partnerships with the NHL, Nascar, the NFL and more recently the NBA, where it is the league’s official provider of real-time statistics, also distributing data and industry standard audio-visual game feeds from the NBA to gaming operators outside of the US.
As an American sports league or franchise, it does not get any better: the biggest sponsorship category in the global sports business market is at reach already, with deep pockets to come and play. Wanna bet? Take that money!
*BWIN and GVC have been consulting clients of the WWP Group.
Rayde Luis Baez, is managing director of the WWP Group in Western and Southern Europe and Americas, leading the charge of global football, basketball and motorsports projects, based in Barcelona and Madrid.