[toc]More than 30 states are likely to legalize sports betting in some fashion by 2023 if the federal ban is lifted, according to a new report from Eilers & Krejcik Gaming.
The sports betting report, top-line look: 32 states
Figuring out what a legal sports betting market in the US might look like is certainly a difficult prospect. But it’s one that increasingly looks like a reality, as the New Jersey sports betting case will be heard in the US Supreme Court, with a decision likely in 2018.
A win for New Jersey — meaning PASPA is struck down as unconstitutional — could mean states could decide whether to legalize and regulate sports betting for themselves. And the Eilers report argues that more than three-fifths of states in the US would take part, if allowed.
From the report:
Our base case for the U.S. regulated sports betting market by 2023 calls for 32 states to offer regulated sports betting, with varying approaches to availability and the land-based / mobile question, resulting in a market worth $6.03 billion in annual revenue.
If every state were to legalize sports gambling — with online wagering included — the estimate for annual revenue could increase to nearly $16 billion, in a best-case scenario. (That would come from $245 billion in handle.)
The report goes through several different scenarios. It also breaks down the likelihood of sports betting laws being passed in every state.
The black market for sports betting: < $60 billion
The Eilers report also took a stab at estimating the current market for offshore sports betting from the US.
Quantifying that number has been difficult to do, mostly because there’s not much insight into private, black market sportsbooks.
The American Gaming Association has put the figure being wagered by Americans at $150 billion. However, the Eilers report scales that number back quite a bit.
Eilers estimates that handle for offshore books to be around $50 or $60 billion. That would mean it takes in $2.5 to $3 billion in revenue.
That’s obviously still a large market, but one smaller than what has been publicized previously. It also points out the benefit of a regulated market. Even a partially legalized sports betting environment — with land-based wagering only — could outstrip the current black market, per the Eilers analysis.
What happens next for sports betting?
All of this analysis, of course, depends on the federal climate for sports betting changing. Right now, Nevada sports betting is the only way to legally place single-game wagers in the US.
However, SCOTUS might not deliver a ruling that strikes down PASPA in its entirety. That would set back the timeline offered by Eilers.
The report also comes as a new Washington Post poll says a majority of Americans support legalization of sports betting.
Sentiment toward sports betting has certainly shifted from a lot of corners in recent years. And things could change quickly for sports gambling. But it would still take a positive Supreme Court ruling or a new law from Congress to make the Eilers scenarios a reality.