To The New Owner Of The Carolina Panthers: No, Legal Sports Betting Will Not Hurt NFL TV Ratings

Written By

Updated on

Legal sports betting NFL ratings

Say this much for David Tepper: He is a self-made billionaire who built his fortune risking against conventional wisdom.

So when the new Carolina Panthers owner says that legal sports betting will drive down NFL TV ratings, we first should consider that Tepper is an intelligent, successful hedge fund entrepreneur.

When that second ends, we then should ball up this hastily sketched take and toss it in a dumpster. We should douse it in lighter fluid, throw in a match, and watch it go up in beautiful flames. The moment the fire burns out, we should sprint away and never again speak of such a backward idea.

So what exactly happened here?

Tepper made the comment in question Tuesday at his introductory press conference. Many of his answers sounded free-flowing and unrehearsed, including his thoughts on legal sports betting.

Here’s the full text of his response to a question about media rights that made the record scratch:

“TV’s been fractionalized, so to speak, so there’s a lot of different media, so you’re talking about TV ratings. But when you add up all the different social media, Apple, Amazon and that, I don’t think football is being affected more or less than anything else.

I also think this thing we talked about a little bit before called gambling is going to make ratings go down. I just have a feeling about that. You may know more about that than me, but that’s my feeling.”

Before delving into the research that disproves Tepper’s “feeling,” it is worth acknowledging what he got right. NFL ratings tumbled in 2016 and 2017, though overall broadcast TV viewership also fell. A reasonable case can support Tepper’s opinion on audience fragmentation.

No such case exists for his thoughts on how legal sports betting will affect the NFL’s TV ratings. Let’s talk about reality here …

Your honor, we call our first witness …

Start with the eminently logical postulate that people who wager on a game are more inclined to watch said game. End there if you choose and you still best Tepper in this round.

We brought receipts though, and now will enter them into evidence.

A 2016 study conducted by Nielsen Sports for the American Gaming Association dove deep on the connection between legal sports betting and NFL viewership. The topline takeaways all point to a massive uptick in TV ratings and viewers from legal sports betting:

And furthermore …

A 2015 research project looked specifically at college football and how point spreads affect TV viewing habits. Water remains wet, according to the abstract:

Speculation has long proposed that interest in live sports programming has been fueled by the gambling market. We separate interest in outcome uncertainty from interest in the betting market and uncover that consumers are sensitive to contest outcomes relative to both the sides and totals markets.

Steven Salaga from Texas A&M University further explained his study in an ESPN article:

“In the sample of games with point spreads of at least 21 points, if we had seven-point moves closer to the spread, that equaled about a 1.235 ratings point increase, which is about 30 percent of the overall game rating on average. So you’re talking about a pretty big shift in television ratings just based on basically a one-score change in reference to the spread. You’re talking big changes.

“There’s really strong evidence, even in these games that weren’t close and weren’t expected to be close, we’re seeing that people are watching or not watching based on what happens in relationship to the point spread. If you’re interested in gambling, it’s pretty exciting.”

A little more from Tepper

Tepper’s head-scratcher on gambling came later in his press conference. He discussed the possibility of in-stadium gambling near the start:

“(There’s) a law that was passed just recently and it’s not yet hit the Carolinas, the whole gambling aspect. And you think about the fans and you want to keep the fans in the building.

“Eventually it’s going to hit North and South Carolina. It has to from a revenue standpoint. You have issues with paying teachers and other things down here, and tax revenues, so it’s just inevitable.

“When we’re thinking about these things, we have to take that into consideration because I want to make sure fans are in that building and cheering this team. I don’t want fans not in that building.”

While in-stadium wagering is prevalent throughout Europe and the United Kingdom, its utility in the US legal sports betting market appears limited. Mobile and online wagering can eliminate much of the need for betting windows. A trip to the concourse and another wait in line sounds painful compared to pulling out your phone and opening an app.

Tepper has nothing to worry about in North Carolina right now. No legislators in the state have pushed for legal sports betting as yet and a recent Morgan Stanley study reported “minimal political chatter” on the subject.

Maybe the hunch of Tepper, a former Pittsburgh Steelers minority owner and certified very rich man, relegates us to Freezing Cold Takes on ratings and betting down the line. But if Tepper wants to bet us, say, somewhere around the $2.275 billion he just spent on the Panthers, we’ll take that action.