Horse race betting was only allowed in a few states prior to this recent boom of legislation, allowing states to have access to sports betting. Nevada held a monopoly on the sports industry being the place where bettors got their fix when it came to sports-betting. Nevada had a record of $300 million in revenue just from sports betting in 2018. That figure should be affected by the decision of the Supreme Court allowing states to legalize sports betting outside of Nevada. So what does that mean for the industry in Nevada?
With the overturning of Professional Amateur Sports Protection Act (PASPA) that was passed in 1992, states are now allowed to pass legislation allowing sports gambling in their states. One of the first states to follow suit was New Jersey. The Garden State saw $318.9 million in handle and $15.5 million in revenue which was more then Nevada’s $317.3 in handle and $11.6 in revenue in 2018, according to a report from a report by CNBC. This doesn’t mean that all states will see massive revenues which would result in Nevada being hurt by this.
Executive Director for the International Gaming Institute at UNLV, Dr. Bo Bernhard, doesn’t believe that Nevada will see a massive effect. “Every time states (and international jurisdictions) have expanded gambling, critics have contended that Nevada will be adversely affected. When Atlantic City opened, it was thought that nobody from the east coast would come anymore. When tribal gaming expanded, people wondered how Las Vegas would compete when gambling was available just around the corner, all over America. And internet gambling really brought gambling (legal and illegal) into every home in America. Each time, as gambling has been "exposed" to more people, it seems some of them have decided to try the "Super Bowl" that is Las Vegas, and Las Vegas' numbers have increased. Until this no longer happens, we should expect this to happen”.
Dr. Anthony Lucas a hospitality professor at UNLV, believes that there could be a potential decline. “It's hard to say. I think in terms of revenue from sports wagering I think it’s likely that there will be a decline”. While Dr. Lucas believes there might be an effect in the sport books, the whole economy of Vegas as a whole will not be affected. “I think the economic effect will be so small it won’t even be noticeable, because really the sport books provide such little operating profit. For example, a strip property on the book they might make an operating profit of $3 million a year and that same property will make $100 million in operating profit in slots. Comparatively speaking it's such a small piece of the Vegas business model that it doesn’t really matter”.
In other terms of economic effect that these new sport books in other states might have, Vegas can actually benefit because it causes Vegas to change. Vegas has always done things bigger and better than the competitors and new states will have to play catch up with the Vegas model. “Think of all of the potentially new customers that each of these states are spending millions of marketing dollars trying to attract (and of course, many of these customers were already betting illegally, with their local bookies or on the internet). Las Vegas actually has an opportunity to create a "total experience" to attract some of these customers to the city. For instance, the LINQ sports book has a creative, social, "party atmosphere" that seeks to combine the sports book experience with the day club experience. And nobody does the "big experience" quite like Las Vegas” states Bernhard. And other sport books other then the LINQ have been slowly improving the experience. The Westgate Superbook has been known as king of the sportsbooks in Vegas. Other casinos have taken notice and improved. Sport books like the one in the Venetian and the sportsbook at the Caesars Palace have added premium seating as well as massive LED TV to give sports betters and sports enthusiasts alike an experience that they won’t be able to get their local sports bar.
One thing that can be expected is that the legalization of sports betting across different states might open the door for other potential gaming opportunities for those states. “Potentially, and this certainly is the hope of those who want to see more gambling in more locations. As the general public grows more comfortable with sports betting, there is a possibility that this comfort level extends to other types of gambling as well” Bernhard states. Sports betting has created partnerships with some of the biggest in the industry with every sports league. MGM Resorts International, which employs the most people in Las Vegas with over 55,000, has partnerships with Major League Baseball, the National Basketball Association, and the National Football League. They also have a partnership with the New York Jets, and some teams have exclusive deals with casinos or sportsbooks. With all these partnerships occurring it shows how the stigma that “gambling is bad” is going away when everyone is jumping on board.
Dr. Anthony Lucas believes that the big jump in the acceptance of gambling might have to do with the lobbyists finally convincing politicians. “To me, I think, a lot of this probably has to do with American Gaming Association’s lobbying efforts in Washington D.C., they had a pretty well organized plan to campaign to legalize sports betting. I think also some of the legal proceedings that came out of New Jersey opened the door to all of this as well”. This might have to do with how much money is available to be made. Sports gambling is a multi-billion dollar industry that has seen much of it occurring illegally. It only makes sense for states to find ways to get a piece of that money in terms of tax dollars from each bet made, and sports leagues to make even more money as well with licensing fees as well as partnerships.
It is difficult to predict how Las Vegas and Nevada as a whole will be affected due to many states slowly passing legislation to legalize sports betting. Only 7 states have had little action on bills being proposed which means that in as short as a decade, most of the country will have sports betting available to the. Sports gambling is spreading across the country. Nevada used to be the only player in town but it has now joined by Delaware, Mississippi, New Jersey, West Virginia, Pennsylvania, and Rhode Island. It seems like Las Vegas could have a run for its money but no one does it quite like Vegas, and being the expert, it seems like these new states might actually help Vegas in the long run. Like Elvis was the “King of Rock and Roll”, Las Vegas will remain the king in the sports gambling world and none of these states will take its crown.
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