Online Sports Betting

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Online Sports Betting

Apps like FanDuel are a popular tool for online betting.[1]

Over the last century gambling has increased in popularity in the United States, from being almost entirely illegal in all states, to now legal with increased popularity of online gambling. [5] Sports betting was restricted to only the state of Nevada, but in 2018 the Supreme Court overturned federal prohibitions legalizing betting on sporting events. 21 states and Washington D.C. now allow betting on an electronic device. Bets can be made that range from predicting the winner of a game, to who will win the coin toss before kick off of a football game. Bets are typically placed on popular sports betting apps such as DraftKings and FanDuel, allowing bets to be made from home instead of meeting with a broker. Online sports gambling has already had a surge in popularity among Americans, with $13 billion bet on sporting events in 2019, with events such as the Super Bowl and NCAA “March Madness” basketball tournaments being some of the more popular events to bet on. The number of unique bets and total dollars betted is expected to grow every passing year. [6] This new industry has made it legal and convenient for fans to bet on their favorite sporting events, but some criticize the rapid expansion by not focussing on gambling addiction, normalization of gambling, little state intervention, as well as claims that these gambling apps persuade users by not clearly stating warnings of gambling, offering risk-free trials, as well as allowing 24/7 betting to take place.Others are concerned at how advertisements of sports gambling targets a younger audience and if enough research has been done to help those that have a gambling addiction.

Appeal of Online Gambling Some of the appeal of online gambling comes from the unpredictability of traditional gambling. Online sports betting gives convenience to users by how accessible these apps are at finding different betting avenues. Online sports betting allows users the convenience to place bets by how accessible betting apps make it to find new betting opportunities. Sporting betting apps allow users to make bets on a global scale; they are no longer secluded in their own state or country, but can now wager on major events across the globe at any given time. Betting online also brings anonymity to users, as some feel that there is a negative stigma attached to gambling. Apps allow players to make usernames that allow users to be as open or quiet about their habits as they would like. Because everything is done online, and typically on a cell phone, users can access these services from their home or anywhere they go..[7] Having everything online can also lead to more communication amongst other users, such as the creation of online communities that can be organized by anonymous users or friends..[8]

Revenue in States David Forman, senior director of research at the American Gaming Association, says that online sports betting has increased so rapidly in many states due to the fact that they don't have to travel to a casino anymore to place a bet. Before 2019, someone that wanted to wager on a sporting event would have to travel to Las Vegas to make a bet, because most people would have to travel a great distance to do so, there wasn’t much of an appeal to make a legal bet.[9] Prior to the legalization of online gambling, it is estimated that Americans spent roughly $100 billion each year on illegal sports gambling.[10] In 2014, the commissioner of the NBA, Adam Silver, compared online sports betting to marijuana, saying that people are going to do it regardlessly, and felt that the league should offer a legal and regulated platform for fans to gamble on.[11] Many states saw the chance of online gambling as a way to start sports betting as many states do not have any traditional casinos. Tennessee had no legal ways to gamble as there were no traditional casinos in the state, but had an eager market. In November 2020, Tennessee made online betting legal and became the ninth highest state to earn revenue from sports gambling, making $155 million as of September 2021. [12] A higher ranking state to earn revenue from sports gambling, such as New Jersey, had $1 billion in sports betting in September of 2021. This generated $46 million in tax revenue for the state of New Jersey. A majority of these bets were made over a cellphone. Because New Jersey legalized gambling before New York, many New Yorkers would travel to New Jersey just to place a sporting bet. New York has since rushed to approve two licenses for companies to operate sports gambling sites, the first group consists of Caesars Sportsbook, Wynn Interactive, and Rush Street, and the second group consists of FanDuel, DraftKings, BetMGM, and Bally’s Interactive. The state is planning to allow New Yorkers to start gambling by the 2022 Super Bowl. [13] In October of 2018, it was estimated that if every state participated in online sports betting it would create about $100 billion every year, while the National Gambling Impact Study Commissions believes that the number would be closer to $400 billion.[14]

Perceptions of League Owners

The "Black Sox" fixed the 1919 World Series.[2]

Gambling in sports has been seen with negative connotations in the United States for many years. In 1949, gambling on sports was out right banned. Professional sports owners felt that it was in the best interest for players and fans to not allow gambling on sporting events. League owners were worried that there would be a lack of trust between fans and athletes, as some fear that athletes would be susceptible to bribes and would intentionally lose games. Owners felt that athleticism of the games players participated in would be tarnished if a player was caught accepting bribes. Although it was known that illegal gambling was taking place between fans, most league owners were very against the notion.[15]One league owner that was for sports gambling before it became legalized was Ted Leonsis, who owns Capital One Arena in Washington D.C., as well as the Washington Capitals and the Washington Wizards. He stated that he wanted a sports bar and betting window similar to that at a horse race track, and also suggested that another company would run the gambling company as this might be seen as a “conflict of interest” in the eyes of fans. Leonsis also said that he wanted to outlaw the word ‘gambling’, and maybe call it ‘interactive wagering’. He also mentions that people that bet on sports disassociate the activity from other kinds of gambling. Leonsis also owns a share in DraftKings, and would like to have sports commentary that deals into the topic of point spreads and other aspects of gambling on Sports Washington cable channel. Leonsis stated that this was an opportunity to create more jobs and more taxes would be gained. Leonsis also brings up the controversy of players accepting bribes to purposely throw games, mentioning that players used to be paid lower amounts during regular season games to incentive the payouts of playoff games, and because players made more money in the modern era of sports they would not be as susceptible to payouts.[16]

Incidences of Gambling and Professional Athletes In 1919, eight players from the Chicago White Sox agreed to lose the World Series in exchange for cash from sports betters. This was the first known event of throwing games for the benefit of gambling, and this incident is often referred to as the “Black Sox” scandal and although this event happened over 100 years ago, it is still mentioned whenever sports betting is brought up.[17]

The NHL is currently still investigating this incident.[3]

In August of 2021, the National Hockey League (NHL) started an investigation on San Jose Sharks forward Evander Kane. Evander Kane’s wife, Anna Kane, posted on Instagram that Evander Kane bet against his own team and would intentionally throw games and compensate himself by betting on the other team. Evander Kane is known across the league as a sports gambler, but never in hockey. Kane filed for chapter 7 bankruptcy and claims to have lost $1.5 million from gambling and denies the accusation of him betting on hockey. The NHL has strict rules against players betting on hockey games with “Gambling on any NHL game is prohibited” in every team’s locker room. The punishment for breaking this rule can be a $10,000 fine; canceling the player’s contract with the team they are currently on; or suspending the player for a definite or indefinite period from the NHL. While measures like this are prevalent in all professional sports, it is a considerably difficult feat to regulate as it can be challenging to identify who placed the bet or if a bad play was intentional or not. Conscious Gaming is an organization that offers a service called PlayPause that can list individuals that are banned from betting a particular sporting event, however, no professional league has tried the service at this time. [18]

Aspects of Online Gambling Gambling has some factors that can change the perception as they gamble such as the present win probability of a particular game, how often someone can place a bet in a given amount of time, loss chasing (gambling to recover lost money), the size of the anticipated jackpot size, or the psychological bias of a “near-miss opportunity” or seeing a loss as almost winning. These are all factors that keep someone betting in a traditional gambling scenario. With online sports betting there are a few more factors to be considered. One of these factors being that an app has multiple games going on at the same time and a user can bet on multiple games across the world. National sports leagues are also adding more play by play betting. This gives users more options to make bets than just picking a winner of a game. [19] What leagues want to do is to start collecting more statistics about every player. This can include such things as how fast a player can run, how hard a player can kick a ball, or how accurate someone is at throwing a ball. The idea behind this is to create more betting opportunities throughout a game called “real-time digital wagering”. This gives users the ability to bet more even if they are losing or winning a current bet. During a sports broadcast, a new bet may pop up on the app during an NFL game asking the user if they think a team’s kicker will make the next field goal.[20]. This has been criticized as being an illusion of skill and trying to remove the factor of luck, and having the user feel that they are knowledgeable about the game they are watching. This can also turn to “fantasy sports”, or leagues of users that make up teams of players that the user selects and has their team going against other users' teams based on the general statistics on how each player performed that week, resulting in a gamified experience for the user. Some apps or websites use virtual in-app microtransactions that can make it difficult to distinguish the use of virtual money and real money. Some users may also not feel a connection of money lost when it only appears on a screen compared to betting with real money in hand. [21]


An example of a FanDuel advertisement.[4]

Advertisements of gambling apps use three different strategies to bring in new users. These apps are claimed to make betting normalized, losing in betting is not threatening, and betting is very much a social activity. These claims are made by saying that these types of advertising is a risk-free activity, and that by doing this it can be misleading and hide the risk of gambling. [22] Some ways that apps try to make themselves feel “normalized” is by promotions through teams and sponsorships. In English soccer, 26 of the 44 teams have sponsorships with betting sites.Since 2019, the NHL has made new sponsorships including DraftKings, FanDuel, William Hill, PointsBet and Bally’s, and others. [23]. Ads for these apps also use specific language such as risk-free and no-brainer promos and say to sign up with friends, showing a social aspect of gambling. [24] These types of promotional materials are used to attract new clients and to give rewards to loyal customers. This “free money” does often require them to bet even more before they can claim these rewards.[25]

Normalization of Gambling Among Peers

Many young adults have embraced gambling and sports betting as new social traditions. There are many social norms appearing such as March Madness brackets and squares betting in the Super Bowl. It is becoming more common in young adults to have poker nights and casino fund-raisers for fraternities and sororities.[26] Connections to major sports teams have also started to form, and in 2016 Gary Bettman said that he wanted to keep away from sport betting and felt that sports should be a family friendly environment. After the Supreme Court changed the gambling laws, Bettman stated that “ I owed it to our fans, I owed it to our clubs, to embrace the evolving world, whether it’s sports betting or changes in technology. In this day and age, you either evolve or become extinct. It was also thought that gambling in groups may lower the chances of someone wanting to engage in online betting. Further research however shows that peer pressure plays a larger role than originally imagined and leads to a higher probability of impulse betting, as well as excessive betting typically occurs while in a group.

There are also concerns as to how and who gambling sites target in their advertisements, and there have been claims that online data profiling is being used to target users with lower income and reported higher levels of their income going to gambling.There has also been worry that minors have taken their parents credit card information and gambled online, the report that two-fifths of 11-16 year olds in England gambled in 2019. [27] An Australian research team studied children aged 5 to 12, and asked them to connect their favorite team with the brand that is most associated with the team. The idea of the exercise was for the children to match the company that sponsors the team, these sponsors are displayed on the teams jersey. The study found that one fifth of the children matched their team with the betting company Bet365, a company that does not sponsor any Australian team, but plays advertisements during their games. The study suggests that these children are associating sports betting with sports in general instead of two separate activities. While most adults that participate in online gambling do not face major losses or repercussions, about 1 percent of American adults have a gambling disorder. This is roughly 6 million adults that would be categorized as having a gambling problem in a given year.[28] A gambling disorder is defined by Dr. Fong, the director of the Gambling Studies Program at UCLA, as to counting to gamble despite harmful consequences. Dr. Fong also mentions that most people that develop this serious issue never seek any kind of help or treatment. The average sports better is single, under 35, and typically male. The National Council on Problem Gambling says that sports bettors are more likely to have a gambling addiction compared to other types of gamblers. Roughly 6 percent of these problematic gamblers are college students in the United States. These students' problems can lead to debt, failing grades, and psychological problems. There is also evidence that suggests if a family member has experienced some sort of gambling problem, other family members have a significantly higher chance of developing the problem as well. This is often the case for young adults as the Algamus Gambling Recovery Center in Arizona has doubled since the legalization of online sports betting. Those in recovery felt that the ability to access the app 24/7 lay in a large part of the problem. [29] DraftKings has on average 45,000 to 55,000 different proportions for gamblers to consider every day.[30] One of the patients asked to be blocked by the gambling sites, his account was suspended but they were allowed to reopen all of their accounts after they had relapsed. [31] Those that suffer from sports betting report that advertisements for betting increases their desire to bet and makes it difficult for them to stop betting. There is very little research when it comes to seeing if ads for sports betting influence new users to start betting, but it appears to mostly keep old customers. Problem gamblers have stated that the biggest draw from them is the promises that the advertisements make, such as a free bonus when they start playing.[32] The National Council on Problem Gambling (NCPG) states that sports betting is mostly seen as a way for states to gain tax revenue and most people see it as another form of entertainment. The director of the NCPG, with Whyte says that the issue is how addictive gambling can be and It’s the only addictive service or product where a state government is so heavily involved. The NCPG also found in a survey that over half of adults feel that it is the individual’s fault for subliming to addiction, and that they should be blamed for their own problems. Sports betting is now legal in almost all of the United States, and there are concerns that the troubles tied to gambling addiction are not not being properly addressed. Recovery advocates fear that as the number of gambling participants increases that it might be too late to warn users about the long term harm that may come from sport betting. [33]Some see online sports betting to be a social aspect, and talking about sports statistics creates interesting conversation about their favorite teams, as well as adding an excitement factor while viewing sports.[34]

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