In the burgeoning world of legal sports betting, partnerships between bookmakers and leagues are becoming increasingly common. As sports betting continues to grow at a breakneck pace, many operators are leveraging these relationships to ramp up fan engagement while preserving the integrity of the game.
The NBA, MLB and NHL are among the leagues that have struck deals to provide official data for sportsbooks. The data is used to grade in-play wagers. The leagues have argued that the use of official data will create consistency across all regulated markets, but some observers question whether or not it is necessary to achieve this goal. In addition, the cost of official data is a significant obstacle for some states, which are struggling to balance their desire to encourage betting with concerns over player privacy and market competition.
Despite the challenges, there are positive signs that sports betting is making progress in the US. For example, a new partnership between the PGA Tour and DraftKings is aimed at driving fan engagement while protecting the integrity of the game. Several other partnerships have been announced between professional teams and sportsbooks, which could lead to further growth in the sector.
A key tenet of these relationships is that they must be mutually beneficial for both sides. The PGA Tour, for instance, recognizes that its events only account for a small percentage of the overall betting market. However, it expects that share to increase significantly in the coming five to 10 years. The PGA Tour therefore wants to ensure that it is present in the broader betting ecosystem and is able to maximize its revenue.
Another tenet is that partners must comply with the rules and regulations of their respective sports. This includes abiding by federal and state gambling laws, as well as adhering to sports-specific regulations. For example, it is illegal to accept or solicit a bribe in connection with a match or event that has been fixed. The code also bans players, coaches and front-office staff members from placing bets on their own team or a specific player. This prohibition applies to all matches and events in which a team or individual is involved.
The code also prohibits the use of inside information for gambling purposes. For example, in 1919, Joseph Sullivan paid eight Chicago White Sox players (Oscar Felsch, Arnold Gandil, Shoeless Joe Jackson, Fred McMullin, Charles Risberg, George Weaver, Claude Williams, and a man named “Sport” Johnson) $10,000 each to fix the World Series against the Cincinnati Reds. This was one of the biggest sports scandals in history and led to a lifetime ban from baseball for all players involved.
Some states have enacted laws prohibiting the sale or advertising of sports betting, but most have found ways to circumvent them. In 2022, for example, the Washington Nationals and BetMGM formed a partnership to open the first retail sportsbook in the nation’s capital and launched an app called GamBetDC. However, this entrant has yet to generate much handle.