Sportradar calls for legislation to support US offshore conversion

Sportradar calls for legislation to support US offshore conversion

Wednesday, July 4, 2018 Posted by Luke Massey
No alternative text provided
Dr Laila Mintas was speaking at this week’s WGES in Barcelona

Dr Laila Mintas, deputy president at Sportradar US, said that betting operators need the right legal framework to convert an estimated $200 billion spent annually with offshore sportsbooks.

Mintas was speaking about the future of sports betting in the US at this week’s World Gaming Executive Summit (WGES) in Barcelona, alongside Bill Pascrell III, a strategic advisor to the Princeton Public Affairs Group, Colossus Bets CEO Bernard Marantelli, and Don Best Sports CEO Benjie Cherniak.

Mintas said: "There are six states so far when betting is legal, including Nevada. In the next two years or so we expect maybe 11 more, taking us nearer 20 that permit betting. But the market needs to compete with the existing offshore market. So, what has changed?

"Well $200bn is bet outside the US every year so in order to convert that unregulated offshore market the regulators need to give the betting operators the right legal framework. But then some taxes are too high - nearly 60% in Delaware, 36 per cent in Pennsylvania.”

In Pennsylvania, this 36% tax, comprised of 34% gross gaming revenues (GGR) and 2% local share assessment, is supplemented by an initial $10 million fee for sportsbook operators, compared with New Jersey where there is no initial fee and a less prohibitive tax rate - 8.5% for on-premises wagering and 13% for online or mobile sports bets.

However, Pennsylvania is not alone in charging high for the privilege of offering a sports bet. Rhode Island state will take more than half (51%) of all gaming revenue in a bid to fulfil an ambitious budget of $23.5m earmarked by governor Raimondo.

“The regulated operators need to be permitted to compete with the offshore industry,” Mintas continued. “People need to be educated. We try to educate the stakeholders on what the challenges might be if the market is too restrictive.

"I don't see a federal law in the next few years. I also think it’s a huge market opportunity for all the different stakeholders. You have 350 million people in the US all speaking the same language. Compare that to Europe, for example. It is a massive opportunity."

Delaware governor John Carney made history on 5 June by placing the first official US sports wager outside Nevada at Dover Downs Hotel & Casino’s Race & Sports Book.

Totally Gaming says: Carney’s bet was widely heralded as a new dawn for sports betting in the US. Yet, as Sportradar rightly points out, an operator may be forced to rethink its sportsbook strategy if licence fees and tax rates are deemed too steep to turn a profit. From a punters’ point of view, if there is a big price differential between the onshore and the offshore, because of costs imposed by the state, then they will still gravitate towards the offshore.

Latest
TV

UK TV gambling ad ban to come into force in 2019

New Jersey

New Jersey sees sports betting revenue almost double in November

Basketball

The Stars Group seals NBA partnership

Job

Intralot hires Codere veteran to lead US sports betting push

Gaming Products & Services Directory

The essential directory for the gaming industry