A new sports betting precedent for leagues, operators?

NBA Announces MGM As First ‘Official Gaming Partner’ Of The Pro Hoops League

NBA sports betting MGM

This is a developing story and will be updated.

NEW YORK — The NBA announced that MGM Resorts International is the league’s first “official gaming partner” during a joint press conference involving Commissioner Adam Silver and MGM CEO Jim Murren on Tuesday.

More on the NBA and MGM

From a press release on the deal:

As part of the partnership, MGM Resorts will use official NBA and WNBA data and branding, on a non-exclusive basis, across MGM Resorts’ land-based and digital sports betting offerings throughout the United States.

MGM Resorts will be promoted across the NBA’s digital assets including NBA TV, NBA.com, the NBA App and NBA social media platforms.  Additionally, the NBA will be promoted across MGM Resorts’ sports betting platforms.

Full presser here.

Silver noted that the deal involved a lot of “good faith,” and it’s the first such deal between a pro US league and a gaming company. The deal is reportedly for three years and $25 million.

The NBA and MGM already enjoyed a good relationship. MGM hosts the NBA’s Summer League and also owns a WNBA franchise, the Las Vegas Aces.

The deal would appear to take effect quickly in both Nevada and New Jersey, where MGM has resorts. MGM has casinos and sportsbooks around Las Vegas, and also owns the Borgata in Atlantic City.

Murren also noted that the Borgata would take mobile wagers for NJ sports betting by “the end of the week.” That would make it the first to take an online wager in the state.

Start of detente for sports leagues, gaming?

The NBA and the gaming industry often have been at odds as legal sports betting has been discussed at the state level in recent months.

The deal between a pro sports league and a major gaming company could signal a detente when it comes to lobbying for laws about sports betting and sometimes contentious “integrity fees” that the NBA has wanted.

It signals a real willingness by the NBA to handle at least some of its policy goals via a commercial deal, rather than legislatively. To date, lawmakers have not enacted any of what the NBA and its sports betting lobbying partners — Major League Baseball and the PGA Tour — have asked for in laws in a half-dozen states.

“We were able to establish, through a commercial relationship, that we should be compensated for our intellectual property and for our official data,” Silver said. “And I think that, ultimately, it was on us to convince MGM there was a commercial benefit to compensating us for that data.”

The American Gaming Association is a fan of the deal:

“Sports betting deals should be done through contracts — not statutory obligations,” said Sara Slane, Senior Vice President of Public Affairs for the AGA. “Today’s announcement highlights the symbiotic partnership between casino gaming companies and sports entities. We anticipate this is the first of many to come.”

Integrity fees based on handle?

Do the terms of the deal have anything to do with the amount wagered on NBA games?

Here’s Silver:

The short answer is no. It doesn’t work specifically that way. I think we’re still having our discussions with our states about so-called integrity fees based on handle.

I think here, as Jim said, there’s so much that’s unknown. I think we understood the value of our marks, of official designations. I think that comes more from the world of what we would call a ‘marketing partnership’ at the league.

But I think then in terms of the data we’re providing. We have a sense of the current magnitude of this current business and a sense of where things may go over the next few years. And I’d say we generally tried to approximate, in a sense, to come up with what we thought was fair compensation. And I would say we do feel that we’re being fairly compensated.

Why the deal for MGM?

MGM took the plunge with the NBA, agreeing to a commercial deal that gives NBA a lot of what it wants, short of new laws being enacted. The NBA would probably be ecstatic if other gaming companies enter into similar agreements with it, paying for “official data.” (The deal is not an exclusive one, other than the designation as an “official” partner.)

MGM appears to be paying for a relationship with the league that no one else in the US is, which, Silver even noted, could put it at a market disadvantage if no one else follows its lead.

Murren’s answer to that dynamic: It’s a brave new world:

This is a partnership of trust. It’s been based on an understanding that this is a new frontier. We have to figure this out together. We have to understand that there are many questions left unanswered. But it’s been my commitment at MGM to try to answer those questions.

And the fact that we have a passionate love for basketball dating back many, many years and a passionate love of sports in general, I felt that this was the perfect partnership to try to enter into.

MGM stays aggressive on sports betting

This has already been a major week for MGM on sports betting, as it’s the third deal it announced in the space of two days.

On Monday, MGM entered into a deal with Boyd Gaming to roll out online gambling and sports betting around the country via their combined portfolios. Between the two companies’ casinos, that could put MGM in 15 states for sports betting, should all of them eventually legalize wagering.

MGM also announced a joint venture with GVC for online and mobile sports betting as it expands to other states.

More from Murren on its recent sports betting run:

“We believed in order to approach the US, we needed to do the following: We need to have great brands. We have that at MGM. We needed to have the right market access to be in the states where we can do so. We have that.

But we also need the best possible technology, the best in-game betting experience which we get with GVC, and now we have tremendous data, analytics and information from the NBA. and that will determine who wins and loses in this arena, the sports betting arena, in the US. And I think MGM is going to win.”

Dustin Gouker
- Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner.