America’s Betting Markets Growing Rapidly
It is estimated that by 2020, more than 50% of Americans will be able to participate in sports betting. This follows the rapid growth of the industry following the PAPSA ruling last year. May 2018 saw the Supreme Court rule that Professional and Amateur Sports Protection Act was unconstitutional. This opened the doors for individual states to regulate their own sports betting activities.
Subsequently, 13 US states have legalized sports betting to some degree, with more expected to follow. As more states legalize, so more Americans have access to sport book services, which has led to the market size estimate being 50% of the population.
At the time of the ruling, the illegal market was estimated to be worth $150 billion per annum.
More States Expected To Go Legal
Research and figures show that by 2020, an estimated 35 states will have legalized sports betting. The states that already accept some form or another of wagers are Nevada, New Jersey, Arkansas, Pennsylvania, Delaware, Mississippi, West Virginia, and New Mexico. Oregon, Montana, Iowa, New Hampshire, Indiana, Illinois, and Tennessee are following suit.
The second half of 2018 experienced a 65% revenue increase from $261.3 million to $430.2 million after the ban ended. So far, year to date the total revenues are sitting at $259 million, with a $60 million tax contribution to the state governments.
New Jersey Outperforms Nevada
The most successful regulated state is that of New Jersey, which outperformed Nevada for the first time in May this year. New Jersey enjoyed $318.9m in sports bets at an estimated $15.5 million in profit, compared to Nevada’s $317.3 million with a profit of $11.6 million.
The majority of New Jerseys wagers are placed using mobile platforms, which could account for the success the state is experiencing. In addition, out of state citizens can now simply hop over the state lines to place a legal bet using their mobile.
A Group Effort Required
The exponential increase in sports betting has raised concerns regarding problem gambling. The industry spends roughly $300 million per year on problem gambling, however, not all states have funds allocated specifically for this purpose.
As the industry and access grow, both the NCPG (National Council on Problem Gambling) and gambling research company Eilers & Krejcik have called for a unified front against the obstacles to come. In order to be successful, all stakeholders will need to present a united front.