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Australian bookmaker PointsBet announced plans to enter the US legal sports betting market this week through a skin deal with Meadowlands Racetrack and Tioga Downs.
PointsBet will offer New Jersey sports betting via online and mobile platforms through its deal with Meadowlands Racetrack. The company hopes to go live in the fourth quarter of 2018 with an edgy sports betting product likely to attract notice.
The agreement with Tioga Downs likely must wait for the state legislature to pass a new law to include both online wagering and skins for New York sports betting next year. Both received consideration in failed legislation this year.
FanDuel Sportsbook — via Paddy Power Betfair — already operates the physical book at Meadowlands and will do the same at Tioga Downs when it launches. Tioga Downs is one of four commercial casinos in New York already authorized for sports betting via a 2013 referendum, but state regulators appear to be waiting for a new law from the legislature before giving any approval.
PointsBet CEO Sam Swanell told Legal Sports Report that despite starting 16 months ago in Australia, US deals drove the company’s plan.
“It was all about America,” Swanell said. “Australia was very much proof-of-concept for us. We always had one eye on America.”
Swanell said PointsBet will offer traditional sports betting via its online and mobile platforms. He is “99 percent” sure that will be via PointsBet branding, but left open the possibility for partnerships.
“There is a chance that we could do a deal with a company that has a stronger brand in the US,” Swanell said.
That traditional offering will provide an entry path to PointsBet’s signature product — Points Betting, a high-risk, high-reward offering. A bettor’s profit or loss depends on how close the final number is to the spread.
Let’s use an NBA total as an example. If you bet $10 on the over at 225 and the total lands at 235, you win 10 times your wager — $100. That’s the high-reward part.
If the game goes under at 215, however, you lose $100. That clearly presents a much greater risk than traditional spread betting that American bettors will need to learn.
PointsBet offers prop bets in addition to regular spreads. During the NBA Finals, the company took action on how many 3-pointers Stephen Curry would make in a game. Via Twitter, PointsBet even encourages customers to suggest their own props and books some of them.
The potential for a big loss on a small bet likely will draw attention from stakeholders. Sports leagues are eager to control what wagers are offered and regulators want to ensure bettors understand their risk.
“You do have to go through an education patch that makes sure that people don’t go overboard,” Swanell said. “But honestly, in Australia, we haven’t had any issues with anyone getting carried away.”
Swanell points to a number of safeguards, including a player’s ability to self-reduce bet limits. If PointsBet sets a wager at a maximum of 25 times the bet, the bettor can choose to reduce it to a lower amount for lower risk. He said a PointsBet representative also calls each new customer to discuss the product.
“It’s very clear — this is how much you can win on this bet and how much you can lose,” Swanell said.
PointsBet hopes to grow beyond New Jersey and New York in the near future. Swanell said he makes monthly trips to the United States for meetings with prospective partners, and that PointsBet is involved in RFP processes across the country.
For the moment, though, Swanell wants to enjoy the accomplishment of securing his first US partnership.
“It’s a big achievement for a relatively new company like us to have beaten out quite a few parties for the Jeff Gural deal,” Swanell said.
Gural, the chairman of Meadowlands and Tioga Downs, praised PointsBet’s strategy in a statement.
“We were impressed by the PointsBet team from our first meeting”, Gural said. “They have a creative approach, with their highly differentiated Points Betting product and aggressive go to market plan. I believe they are the ideal complement to our other partners and am confident they will quickly become a meaningful player in the US market.”
PointsBet offers horse racing, rugby, and Australian Rules Football in its home country. Swanell said the company focuses heavily on American sports, though, and noted 23 percent of handle last year came from NBA games.