Despite Competition, Nevada Sportsbooks Have Record September

Despite Competition, Nevada Sportsbooks Have Record September

In the run-up to the Supreme Court’s PASPA decision, there was a lot of outcry from the Nevada gaming industry. And that’s understandable, given that said industry had enjoyed a total monopoly on legal sports betting for 25 years and was unsure – and thus fearful – about the wide-ranging effects that nationwide access to legal sportsbooks would cause. Of course, that’s largely been an unfounded concern, and despite lots of recent competition, Nevada sportsbooks have had a record September.

In the first month of NFL betting (which is always an indicator of health in the US sports betting market, as professional football is the most popular sport in the country when it comes to wagering), Nevada sportsbooks – anchored by the action in Las Vegas specifically – have set a new monthly record for both total handle and sportsbook revenue at $571 million and $56.3 million, respectively. Indications, of course, are that the month of October will see more of the same, as Nevada hasn’t posted a monthly sports betting loss in over five years.

All that said, and even though this is very good news for both Nevada and sports betting in general, long-term conclusions about legalized sports wagering throughout the country should not be drawn from this sample (or any sample in the near-term future), for a couple of compelling reasons:

First, with all the talk of legalizing sports betting across the nation, the commercial hype is certainly catching on among the mainstream public. That heightened awareness (and reduced “taboo” status) means that folks are more apt to put a few dollars on the line. This explains the $3 million increase in revenue over NV’s previous September record (2012).

However, this also brings the question to point number two: There are still very few land-based venues in the US that are actively offering legal sports betting opportunities. Right now, the hype is far, far greater than the actual accessibility. Outside of Nevada, roughly 1% of casinos nationwide have operational sportsbooks, if that. The only states with casinos and/or racinos accepting sports wagers are New Jersey, Delaware, West Virginia, Mississippi, and New Mexico. If you don’t live in one of those states, you can’t just pick up the phone and place a bet there, as the Interstate Wire Act (1961) is still in effect, and no current book offers telephone wagering even for in-state residents. This means that unless you live near the legal sportsbook in question, you’ve either got to make a long drive to place your wagers, or you will simply use a legal online sportsbook (Bovada, BetOnline, etc.) to do so.

But as more and more states do initiate legal sports betting regulations and offer such services inside their borders (Rhode Island, Pennsylvania, New York, and Connecticut are all on 2018’s short-list, for example, and states like Kentucky and Ohio are slated to broach the subject in 2019), Sin City’s stranglehold on the pastime will be challenged more and more.

Still, as long as folks have to make a bona fide trip or vacation out of their sports betting, these developments will not harm Nevada’s sports wagering industry. With land-based brick-and-mortar options few and far between (especially in flyover country), Las Vegas and other NV regions will only see more interest in the services they offer, at least for now.

Ultimately, the real competition for Nevada’s sports betting industry lies not in land-based venues but in online venues. Most states that have already legalized sports wagering at USA online sportsbooks have also built in language that legalizes (or, at the very least, assigns for official consideration) Internet-based sports betting. In order to maximize revenue potential and recover as much business as possible from the online sportsbooks that already operate legally overseas, states are aware that their sports betting products must be accessible via the Internet.

Once that happens in enough states, giving customers the option to easily shop lines and pick in-state service providers that offer the best lines for each different contest, Nevada might start seeing the negative results of such a mainstream, normalized process. After all, nobody would make a trip halfway across the country just to place an order on, right? With the kind of ubiquitous access that the Internet affords, sports betting could enjoy a major growth spurt even while its Vegas footprint shrinks a size or two.

But if you’re worried that Nevada sportsbooks will be hung out to dry, don’t. The reality is that even should their profits in the sports betting space decline over the next 5-10 years or so, they will not decline enough to matter. Remember, Vegas is an event. It is a spectacle and a destination and a cultural center unique not just in America, but in the entire world. Plus, Vegas books tend to have much higher limits than anywhere else, so when serious bettors gamble, there’s really only one place to go.

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