State of the Union: US Sports Betting Update – New Jersey Operators Lose $4.6 million on the Super Bowl LIII

Bettors in New Jersey are toasting the New England Patriots this week after they romped to a 13-3 victory over the LA Rams in the Super Bowl. Many football fans across the Garden State backed the Pats to cover the spread and Tom Brady and co pulled it off by a comfortable margin. It resulted in a loss of $4.6 million for New Jersey sportsbooks in their first Super Bowl since sports wagering was permitted. However, the picture was markedly different in Nevada, where the books made a handsome win of $10.8 million as the Rams were popular in Las Vegas.

Nevada operators took a handle of $145 million on Super Bowl LIII, which was down from $156 million last year, but it dwarfed the $34.9 million wagered in New Jersey. Last year Nevada sportsbooks held just 0.7% of the handle, a win of $1.2 million. That rose to 7.4% and a win of $10.8 million this time around, and operators benefited from a huge increase in footfall as around 300,000 visitors descended upon Vegas for the big game. That always sends food and beverage sales through the roof, while the casinos benefit too, so the Nevada industry always looks forward to the Super Bowl.

Over in New Jersey, it was an altogether more bruising experience for the new sportsbooks that have sprung up after the Supreme Court struck down PASPA. They paid out $39.5 million on a handle of $34.9 million, resulting in a $4.6 million loss, the New Jersey Division of Gaming Enforcement announced. It was described as a “negative hold percentage” of 13.1%, although operators may well have offset some of those losses by selling food and drink.

FanDuel Takes a Battering

FanDuel may have been the biggest loser in New Jersey after it reported a loss of $5 million on Super Bowl LIII. A significant chunk of that loss came as a result of free bet giveaways it used to entice punters in a competitive market. It was offering 53/1 moneyline odds on either team in the build-up to the game in order to encourage new customers to sign up, and it also offered a relatively generous maximum stake of $5 at those boosted odds. The majority of bettors lumped on the Pats and FanDuel was left to lick its wounds.

“After opening at +1 on New England, customers quickly pumped money on the Patriots and didn’t stop,” said a FanDuel statement. “By kickoff, 75% of money was on the Pats [who ended up as -3 favourites]. In addition, new customers took advantage of a great sign up offer for the Super Bowl this week that won them $265 on a $5 bet with odds of 53/1. All of this combined to leave New England as a big loser for the FanDuel Sportsbook. Very big, in fact. We estimate our customers won almost $5 million from us on the big game in net winnings.”

Desire to Launch Sports Betting Remains Undeterred

DraftKings suffered a similar fate to FanDuel and these operators will now look to the upcoming March Madness as they bid to claw back their losses. They now have plenty more players signed up after the Super Bowl promotions they ran, and they can work on converting them into profits. The New Jersey sportsbooks’ Super Bowl woes have not put any sort of dampener on efforts to roll out sports betting across America. Delaware, New Jersey, Mississippi, West Virginia, New Mexico, Rhode Island and Pennsylvania have all joined Nevada in offering regulated sports wagering after the federal ban was axed in May 2018, and bills are afoot in several more states that want a piece of the action.

This week the Virginia Senate passed a bill called SB 1126 by a vote of 28-12. This bill, introduced by Democrat Senator Louise Lucas, is designed to permit sports betting and introduce land-based casinos to the state for the first time. It would restrict casinos to cities with low unemployment and poverty rates, allowing local authorities to secure approval from residents via a citywide referendum. SB 1126 is one of just seven sports betting bills put forward during the current legislative session in Virginia.

Currently sports fans in Virginia can head over into West Virginia to bet on ball games in a safe, legal environment. Neighbouring Washington, D.C is also poised to roll out sports wagering, so Virginians will end up taking more money out of the state and spending it elsewhere if it does not follow suit. Time is of the essence for the Old Dominion State, as its general assembly adjourns on February 23, so we can look forward to some intriguing developments there in the days ahead.

Welcome to Deadwood

Up in South Dakota, a bid to launch a referendum on whether Deadwood can offer sports betting remains alive and kicking. It scraped through the Senate State Affairs Committee in a 5-4 vote and it will now move to the Senate floor. Proponents claim it will boost tourism to Deadwood. “We compete both with surrounding states and nationally, and need to provide our customers with those gaming products they ask for that other states are providing,” said Mike Rodman, executive director of the Deadwood Gaming Association. Lester Thompson, chairman of the Crow Creek Sioux Tribe, added that it would have “an incredible effect” on tribal gaming.

But opponents argue that the cost of legislating sports wagering will outweigh any tax revenue it brings in.

The Department of Revenue’s deputy secretary, David Weist, said his team estimates that sports betting would bring in a mere $80,000 in taxes and that would not be enough to support it. Rodman and co dispute these figures, and it is the sort of skirmish we are seeing across the country. Yet ultimately the tide has turned very much in favour of legalising sports betting and it is likely that states such as Virginia and South Dakota will join the party in the not too distant future.

Author: Kristian

Kristian heads up the content and SEO team at Digital Fuel having worked in digital marketing for ten years. He’s as passionate about creative content as he is about Brighton & Hove Albion FC and when he’s not following football he’s writing about Brighton’s bustling pub scene

Share This

Copy Link to Clipboard