Ohio Sports Betting Officially Legal & Bills vs Bengals Cancelled | LSR Podcast 176
Ohio legal online sports betting officially launched once 2023 began…and after Ohio State lost in the college football national semifinal. We also take a look at how the NFL and sportsbooks dealt with the Bill-Bengals game. And Barstool Sportsbook is officially coming to Massachusetts
Matt Brown (00:08):
Hello, and welcome to episode number 176 of the LSR Podcast. My name is Matt Brown, joined each and every week by the brightest minds in all the gaming industry. With me, I have Dustin Gouker, I have Adam Candee. Our first podcast of 2023. You can follow them on the Twitter machine if you want to, @DustinGouker, @AdamCandee — two E’s, no Y — and if you hate yourself, you can follow me, @MattBrownM2. We will look at Ohio launching at 12:01, and what an interesting launch it was for sports fans in that state, no doubt, to talk about DraftKings, as well, Barstool. But let’s kick things off here. Listen, we’re humans, guys, and we are certainly not going to start this podcast off without at least acknowledging the dark cloud here over the sports world, as we sit right now, not knowing what is happening with Damar Hamlin, not knowing how this situation is all going to play out.
Damar Hamlin, Bills vs Bengals
It’s something — I’ve watched nearly every single snap of every football game for the last decade, and something that I’ve never even come close to having to experience or having seen. And Adam, I know you’re pretty much the same here when it comes to the volume of games that you watch and things like that. It was just a very surreal circumstance to sit there and look at. And I know that the ESPN crew was catching flak from people out there and all that, and having done broadcasting, and you and I actually being on air together when the pandemic hit and all the things like that, you’re just not prepared for this stuff. There was no way. I thought those guys did as best as they possibly could do.
I mean, they had to take off their analyst hat, they had to take off their hosting hat, they had to take off their insider hat if you’re Adam Schefter, and basically just be humans and just talk emotionally and talk from the heart. And I thought that they did as well as they could do with everything. And I guess, when it was all said and done, the NFL made the right decision. I know people were worried about the timing of all of that. I don’t know when the timing actually played out, so I guess I give them at least a little bit of leeway there with all that. But, man, it’s just a brutal thing to start here in 2023.
Adam Candee (02:23):
Oh, without question, Matt. To go back to what you mentioned a moment ago with Rudy Gobert and the coronavirus situation back in March of 2020, and just a little bit of inside baseball here, Matt and I were doing a program that went from 6 to 10 p.m. in the Pacific time zone. And that news hit at about 6:30, that Rudy Gobert had tested positive. And basically, we were trying to broadcast in real time the shutdown of the sports world. And when you’re in that moment, not only are you trying to process it yourself, but you’re trying to process it for anybody else who is watching or listening, and that’s the challenge that was in front of Joe Buck and Troy Aikman was something that no one had ever seen before. And with producers in your ear trying to tell you where to go, what’s the next shot? What information do we have, do we not have? And that was playing out on TV, and that was also playing out on the field.
As we talk about, did the, quote, “NFL” want to restart the game? We don’t know who from the NFL was involved in that discussion. We don’t know what game of telephone was involved in someone telling the officials who might have told the teams to be ready to play again. These sorts of things happen in a chaotic state, and I think we need to all have some grace for the people involved in terms of what they were trying to do to handle it. And that extends into our world as well, Matt, as we talk about our tiny little fraction of this situation with the sports betting world.
And social media is filled with people who are angry at sportsbooks who hadn’t made a decision about what to do with their bets, angry at sportsbooks who were trying to follow their own house rules on what to do with these wagers when there was no information to be had from the NFL. Everyone, chill. Just chill and be grateful that this is what you have to be angry about in your world, that this is what you are talking about when everyone — whether it’s the NFL, the sportsbooks or anyone else — is just trying to figure out how to proceed in a largely uncharted situation.
Matt Brown (04:21):
Yeah, Dustin, I think we were all caught up in the moment. I know you were on Twitter and things. And we’re human; we’re emotional human beings. I was sitting there screaming, “Cancel the damn game, what’s going on?” Stuff like that. And as I took a step back, as I had 24 hours to think about it, I mean, the incredible amount of moving parts, the unprecedented circumstance, all the stuff like that, I did at least back off of my position, thinking, “Listen, if I’ve never seen it before, and we have guys that have covered the NFL, Twitter machine guys on there, been watching the NFL for 40 years, they’ve never seen anything like that, well, same deal with everything else that’s going on as well.”
Everybody was trying to figure something out on the fly right there. So, I’ll admit I did overreact a little bit. I understand the magnitude of the decisions that were being made, how complex all of the stuff is. And so, I’ll even admit I was probably a little bit too, “Oh, you got to make a decision just like that,” where it’s not as cut and dry when it comes to stuff like this.
Dustin Gouker (05:24):
Oh, yeah, I overreacted a bunch too. But, yeah, we’re all just trying to deal with this in real time. And like Adam said, everyone is trying. This is a very complex situation going on. And yes, sports betting and fantasy sports, all that, it seems trivial, but the world is also going to go on, and sportsbooks have to deal with a game that is now, we still don’t, as we sit here, know exactly what’s going to go on with that game, if it will even be resumed. But we don’t know. We presume right now that NFL games might be played this weekend, but that’s also up in the air. There’s so much going on here, and the business of the world will go on, but there’s still a real person at the end of this whose life hangs in the balance, and it’s all weird and hard to deal with, and we’re all just humans trying to deal with all that information, and to process it, and then provide the best information that we can around anything that’s going on in NFL gambling.
Matt Brown (06:19):
Right, and that’s the thing we want to acknowledge, obviously, first and foremost, we care about Damar Hamlin, and first and foremost, we care that there’s a human life involved here. But Adam, listen, our job and the reason people are listening to this podcast isn’t for updates on that, because we’re not the best source for that, right? I mean, we’re not medical professionals. We don’t have people on the ground there. Certainly, you should be watching NFL Network, ESPN, even the national networks who are covering this much better than us. But we do have our little space in this, like we’re talking about, and there are implications within all of this, when we’re talking about how complex this even stretches and trickles down.
Because you and I know, since we do content in the industry and things like that, we understand, this game in particular is a game of incredible importance and magnitude from a sports betting standpoint. Not only because of it being two of the highest power-rated teams in the NFL, but we’re talking about win totals in the balance, we’re talking about number one overall seed bets in the balance. We’re talking about divisional, when you’re talking about the Bengals, division bets in the balance and all the stuff with that. So, I mean there are quite literally a massive, millions and millions and millions and millions of dollars, that also are tied to how the NFL decides to go about all of this. Not to mention, even the fantasy stuff. I mean, some of these best ball tournaments that were finishing up this week, first prize, $2 million in some of these things, $1 million to second. So, there really is, in our little neck of the woods, there are a lot of implications that come along with whatever decision is made as well.
Adam Candee (07:58):
Which brings up two points for me, Matt, the first of which is, this is probably the largest situation that the NFL has had to deal with in terms of, how are they viewed for their relationships with sportsbooks, right? Because no matter what decision is made, someone is going to level criticism that this is about betting, that this is about the NFL either protecting sportsbooks or leveraging their relationships with them, which is of course all garbage, but the perception is going to be out there regardless when the situation comes down. So, that is a massive consideration that needs to be factored in. But I also think, under that surface, there’s a responsible gambling angle that comes out of this, too, which is that, yes, you are right. In the aggregate, millions of dollars are at stake in all of the futures markets and bets on this game, et cetera.
However, when we talk about the idea of never bet more than you can afford to lose, to have a set bankroll, well, if you’re truly just betting what you can afford, and this is an entertainment activity, then you shouldn’t be all that worried about how quickly this gets settled or what the relative fairness is in all of it, because no one is making a decision with the intent of screwing you in particular. That is not the way that any of this works. And it is not the purview of the NFL or the sportsbook to do anything other than what it thinks is going to be in the best business interests of themselves, hopefully in the long term, although we have not always seen that be the case, but hopefully with cooler heads in a situation that necessitates it.
And guys, just as a quick personal aside, this is not my first experience with a player going into this sort of situation on the field. I covered a high school game 20 years ago in which a player died shortly after being taken off the field, ultimately from blunt force head trauma. And I watched some of the toughest coaches and young men that I had seen crying and just in complete shock. I watched the young man who was involved in this situation lowered into the ground at his funeral. And it informs everything I think about everything that’s going on here, which is not just the trite, “Oh, well, thoughts and prayers with the family.” No, really, it really is about life and death and these players who take on that risk every time they go out there.
Matt Brown (10:18):
And Dustin, I think everybody that is, and Adam summed it up pretty well of, look, nobody’s out to get you. This isn’t about leagues or relationships or things like that. But this is a good time to remind everyone as well, and I think most people listening to this probably know this anyway, if not, and maybe we’re finding some new listeners along the way as we head into the new year as well. Look, how this all plays out is all in these various books’ house rules, right? I mean, these are things that have to get submitted and approved by gaming commissions and all the different things like that. And so this isn’t like they can just willy-nilly decide how they’re going to handle all of these things. A lot of them have, “If a game is not completed within X amount of days,” “If a game is,” whatever, if a game is postponed, if a game is canceled. They have all of these specific rules all written into the deals that they have to abide by, because these are the things that, again, they got approved by the various gaming commissions
Dustin Gouker (11:12):
And most of the sportsbooks have already dealt with this because of that. Because they’re regulated, because they’re beholden to the rules that they set for themselves. In most cases, if a bet was settled, they settled it. If it was not, it was refunded. There probably might be a handful that still have action on the game because it hasn’t been exactly said what’s going to happen, but most of it’s just been refunded. And that is for both the best interests of everyone. Honestly, that is what should be happening. The game’s not going to happen within a week. We don’t know anything beyond that.
And again, everybody, sportsbooks included, are navigating something that, especially a big event. This is an island game in the NFL where, yeah, nobody’s had to deal with this before, quite honestly. I mean, yes, in soccer, maybe in other settings, but nobody’s dealt with it quite like we’ve had to and the NFL has had to. Black swan event, sure. It’s that kind of thing that you don’t expect it to happen, and you’re trying your best to do right by everyone, including the players and everyone who’s doing this. Because obviously they don’t want to be insensitive to the fact that this guy, Hamlin’s still in a hospital, and all of that. It’s just hard, but at the same time, everything’s a business. Everything’s going to move on, and we’ll see what happens next.
Ohio Sports Betting lauch
Matt Brown (12:39):
Adam, I’ll get to Dustin here in a second for the actual numbers and things on how the Ohio launch went, but from a sporting standpoint, we’re sitting here, we talked about that it was very interesting too, and unfortunate for Ohio just in general, that Ohio State makes the final four of the College Football Playoff and they actually weren’t allowed to bet on the game legally, because the game took place on New Year’s Eve, when this actually goes live on New Year’s Day at 12:01.
But the most ironic, crazy, weird thing in the history of sports betting that probably will never happen again, where literally a game-winning kick for the team is going up as sports betting is going live. They watch it go wide, and then it’s like, “Oh by the way, you can bet live now. You can bet on sports if you want to.” That kick goes through, and you are about to get the best value on TCU that you’ve ever been able to get in the whole wide world, because every drunk Ohio State fan at midnight on New Year’s Eve was going to be pounding the Ohio State Buckeyes. You were going to get TCU plus 17 or something like that. But it ended up not coming to fruition, but it’s just crazy. You could see the countdown to the kick, and the ball dropping and then the kick going wide. Again, we’ll never see anything like it for any of the stuff that we do.
Adam Candee (14:01):
The Ohio Casino Control Commission had the better part of a year to get sports betting up and ready. They knew when the College Football Playoff semifinals would be held, and you’re telling me they couldn’t have gotten it up one day sooner? Do you know the amount of money that was lost either to offshores, to bookies or to other states by Ohio State not being able to receive wagers in Ohio? But preaching to the choir when it comes to that. It was remarkable. It was absolutely remarkable. And I feel badly for those who couldn’t bet in Ohio state, because obviously they couldn’t bet on the Citrus Bowl, either. They were so excited to be able to bet on LSU and Purdue, and I didn’t even put in the rundown that our buddy Drew Brees apparently kept everybody from being able to place wagers in New Jersey on the Citrus Bowl. It’s a damn shame that the equity stake in PointsBet kept everybody from being able to bet on the Citrus Bowl. I’m pretty sad.
Matt Brown (15:07):
So, Dustin, how did things go in general? Of course, we’re only four days in here, but I imagine we at least have some early looks at how Ohio’s going.
Dustin Gouker (15:19):
Yeah, we don’t have revenue or such, but, yeah, to circle back, yes, we have a lot of sportsbooks live in Ohio. Most of them went live right around midnight, as the clock turned over. And I don’t think Adam is really exaggerating. The revenue in Ohio would’ve been much different had Ohio State advanced. There’s no question to that. That excitement and having that game to bet national championship futures and odds and what have you, live bets. That would’ve changed how much money is in Ohio in this first week. So, it is a fascinating part of this. The one piece of data we do have, GeoComply, which does geolocation for almost every sportsbook in the United States, said it did 11.3 million transactions, geolocation, any kind of ping, things like that. It actually surpasses the 9.3 on the opening day, 9.3 million on the opening day of New York. So, that’s how much interest there was day one in Ohio.
Now, how that translates to revenue, it’s not like these are pings for geolocation or a financial transaction, not a one-to-one correlation. But very interesting to see that Ohio had this whole year, people were pent up, and we’ve known for a long, long time that this date was coming and it was going to be at midnight, or that first day. Goes into the NFL playing as well. So, lots there. I’ll also say, I think Ohio is really interesting in that we’re seeing more interest in responsible gambling out of Ohio than we have every state combined almost. It’s crazy what we’ve seen.
We’ve seen DraftKings and Barstool fined for activity that is not RG-compliant. DraftKings sent out messages, sent mail to people who are under 21 about betting on sports. Barstool had an event on a campus and was pitching its sportsbook. And then, Ohio also is putting out messaging about free bets and making sure that you’re having a responsible gaming message. I don’t think, and Adam, correct me if I’m wrong, I have not seen this kind of interest from regulators on RG issues until just now. And it also rolls into Massachusetts, where we’re seeing this being taken much more seriously. Dare I say, this is probably a good thing overall for the industry to start getting this level of interest. It’s hopefully not too late, but I’m actually encouraged that we’re seeing this level of attention to detail on responsible gambling in Ohio.
Adam Candee (17:47):
I, Dustin, think it’s a direct correlation to The New York Times series. And I talked about the fact that there would be immediate repercussions, and maybe this isn’t the worst one of them, where you start to see the industry, in its own way, try to self-regulate, right? And I’m not saying self-regulation from the books themselves. I’m saying it can be self-regulation from a level below the legislature, which tends to put in rules that are not as connected to reality as the regulators who deal with this on a day-to-day basis. And so, we saw the questioning of Barstool in Massachusetts, which we’re going to get to in a minute here, but I think it also leads in when you see the questions that came from The New York Times series and then beyond that, about how is responsible gambling being addressed, that Ohio decided to take a step forward in a way that other states haven’t.
Matt Brown (18:40):
And Adam, just circling back to what we were talking about with just the launch in general, and how Ohio numbers could have looked incredibly different had they even gone one day sooner. Let’s also not forget the first legal thing that they could have bet on with a very big implication involved another Ohio team on Monday night in the Cincinnati Bengals. And these bets are all going to be refunded. These bets are all going to go down as non-action. And so, what could have been, I think, from the first initial month here, certainly even the initial first week in Ohio, could have been just drastically different from I think the number we’re going to end up getting.
I mean, look, anecdotally, and I can only imagine in Ohio on the first opportunity to bet on the game of the year in the NFL, I mean, do a show out of the South Point. I was talking to the bookmakers there. That Monday Night Football game was the largest handle Monday Night Football game heading into Monday of the season, as would be imagined, because again, it was arguably two of the top three teams in the entire NFL that were playing on a Monday Night Football island game. So yeah, I mean, despite the fact that they didn’t get Ohio State either in this revenue push here in the first month, they’re also not going to get that kind of game of the year either. So, I mean, I think we should look at these Ohio numbers when they come out at the end of the month and we’re looking. They’ll still be good because shiny new toy and things like that, but realize what could have been if 48 hours of either decision-making or tragedy had not gone down.
Adam Candee (20:23):
We actually have some numbers from GeoComply that I think will at least be able to tease out the transactions that were attempted at the very least from the revenue that is ultimately realized, right? Because these transactions, for the most part, are going to include money that changed hands. Now, some of that money’s going to go back.
Barstool in Massachusetts
Matt Brown (21:23):
Dustin, let’s talk a little bit about Barstool in Massachusetts.
Dustin Gouker (21:28):
Yeah, if you’re not following the guys at Legal Sports Report and the work that they do, Massachusetts has been the biggest slog that we deal with. There are hours, dozens and dozens of hours the Massachusetts Gaming Commission has been spending on licensing. And again, arguably good that we’re spending this kind of time on licensing people. We just get rubber stamps across the country, and all of a sudden, Massachusetts is doing deep dives into operators before they get it. Barstool, they were considered before the new year. They had two days of meetings to consider their license in the last two days and just saw that they got preliminary suitability licensure in Massachusetts.
So, it had been in question whether Barstool was going to get a license. The commissioners there have not taken very kindly to a lot of what Barstool has done, their work on responsible gambling and all of that. So, Barstool was founded in Massachusetts, arguably going to be one of its biggest markets, and it did get this initial licensure when it wasn’t at all clear that they were going to get that. So, that’s real time. I know our writer, Mike Mazzeo, has just reported that on Twitter. I’m sure a story will be up here in the near future, because this is one we’ve been following. If Barstool didn’t get licensed in Massachusetts, Penn Entertainment I think is taking a real hard look at its investment in Barstool, because I think other jurisdictions are probably starting to say, “Oh, should we be taking a second look at this?” And they avoided that calamity, at least.
Matt Brown (22:58):
Yeah, Adam, we were talking before we went on break for the new year about just stuff we were looking forward to in 2023. Of course, all of us, the number one thing just on our plate is Texas and what’s going to happen there, because, again, that is a landscape-shifting thing that could happen within the industry. But the other thing I am looking forward to as well is if any sort of market penetration whatsoever happens at all with Barstool, and if not, does Penn then change their strategy, right?
Because, I mean, the whole thing has been all along, like, “Well, we don’t really need to market all that much. We don’t need to run these commercials like all these other people, because we’ve got this built-in network, and we can do all of our marketing through that.” Well, at least to date, if we look at the numbers, that hasn’t really come to fruition yet. And so, I do wonder, do we get to the end of 2023, if there’s no real saturation at all, do they make a decision one way or the other? Whether it’s change it to Penn Sportsbook, change whatever, change the marketing strategy, whatever it might be, I do wonder if that’s going to happen sometime over the next 12 months as well.
Adam Candee (24:04):
I don’t think I’m going too far over my skis to say if we get to that point, I think the Penn board of directors will be looking for a new CEO who is not Jay Snowden, because Jay Snowden has gone in so hard so far on Barstool, in a way that was I don’t even think truly necessary to sell the brand to investors. He has bought in 100% on Barstool, and defended them at every single turn, that it would be a massive, massive admission of failure if they go back on the Barstool brand. They would almost need Dave Portnoy et al. to do something so far beyond the pale that it would give them the right to back out of it for PR and saving face reasons. But you know what? That hasn’t happened yet, despite all of the unsavory things that have come out about Barstool and Dave Portnoy over the last few years. So, I don’t see how that happens without a massive shift within the culture of Penn.
Matt Brown (25:07):
Yeah, it’s going to be super interesting. A bunch of different stories for us to follow in 2023. I mean, again, I’m super, super interested in what’s going to happen in some of these other states that we have been following along, and see if there’s any other pushes in some of these other places that we know have had some failed initiatives somewhere along the way as well.
Guys, this is looking forward to another great year here on the podcast. Hopefully, you guys are already subscribed and have already rated us and reviewed us. And if you haven’t, on the audio side, please go in. It takes five seconds. We really do appreciate that. And if you found us over on YouTube, hello, how you doing? Go ahead and hit that subscribe button down below. Really are going to start doing more things on this channel as well from the video side in 2023 too, so really do appreciate the support. It’s all absolutely free, so we really do appreciate you guys being part of everything. If you want to follow Adam, it is Adam Candee, two Es, no Y. You want to follow Dustin, @DustinGouker on the Twitter machine. For Adam, for Dustin, I’m Matt. Talk to you guys next week.