Will Nationwide Legalized Sports Betting Impact Gambling in Las Vegas?

Will Nationwide Legalized Sports Betting Impact Gambling in Las Vegas?

Las Vegas enjoyed a virtual monopoly of the USA’s sports betting market until the Professional and Amateur Sports Protection Act of 1992 was overturned by the Supreme Court in May. Now that dozens of states across the country are currently lining up to launch their own individual sports betting markets, it is natural to assume that the Silver State may be about to take a massive hit to its bottom line. Nevertheless, it’s business as usual in Sin City, with its gambling industry unconcerned over the potential explosion of sports betting that’s about to take place.

$250M Sports Revenue for Las Vegas

While Oregon, Delaware, and Montana were the only other states allowed to offer limited sports betting under PASPA, Nevada alone was permitted to offer the full package of sports wagering options. Consequently, Nevada has historically accounted for the lion’s share of the industry, and last year collected $4.87 billion in wagers, resulting in $248.8 million in revenue, and marking an all-time high for the state.

Nevertheless, Nevada’s almost $5 billion worth of sports wagers in 2017 is believed to represent just 3% of the $150 billion that is bet illegally each year in the US. According to some industry experts, the country’s legal sports betting market is set to grow to around $26 billion over the next few years, and expand further as more states adopt legislation of their own, thus leaving plenty of potential business for legal operators to target.

In the meantime, sports betting currently accounts for just 20% of Nevada’s overall gambling revenues, with the segment representing a mere drop in the ocean compared to its other lucrative verticals, such as slots and table games. Over the past few decades, the state has also built up the necessary infrastructure necessary in order to make such a high turnover-low return business a success, meaning any newcomers looking to immediately cash in on its potential may be left severely disappointed.

Major Gambling and Tourist Resort

Another major advantage Nevada has over an would be competitors is that it is recognized as one of the most entertaining and attractive tourist resorts, in addition to being the world’s second biggest gambling hub. In other words, Las Vegas can offer visitors a complete package of vacationing experiences, including excellent food and beverage services, as well as famous entertainers providing regular shows that draw visitors to its casinos.

Sin City also caters for the requirements of high rollers, and excels at providing a world-class service for this lucrative category of customer, complete with free limousine services, complementary hotel rooms, food, beverages, and tickets to shows and live entertainment.

In other words, those US states looking to adopt sports betting will have a tough time competing against Las Vegas by trying to lure high rollers or tourists in general to their respective states. Those states that do finally approve legislation, a process that can take years to complete, will then have to spend more time and money creating the infrastructure required to set up a well functioning and viable sports gambling market capable of drawing customers to their businesses.

All the while, Las Vegas will continue benefiting from already having a well established and organized sports betting market, and an enviable tourist industry that each year attracts millions of people looking to enjoy a great vacation, and perhaps win big at its casinos’ numerous slots and tables games.

Nevada to Profit from Legal Sports Wagering?

Finally, Nevada stands to benefit from legalized sports betting across the country, as it could lead to a greater level of exposure for individual sports, and therefore a much larger handle for local casinos. From October to April, for instance, local hockey bets surged in the state, with the handle soaring by an impressive 30%, and bets placed on the Vegas Golden Knights 15 times that of their opponents. Moreover, around 40% of wagers were made by first time sports bettors, and as Brian McGill, a gaming analyst from Telsey Advisory Group, explains:

“So, we have the least popular major sport in a town that knew nothing about hockey until this year driving up the handle by 40 percent in a year. How much would get bet on the Giants in New York given the history and popularity of the sport versus hockey?”

McGill further points out that local casinos also noted an uptick in visitors over the period, with people venturing out to watch sports games at bars, restaurants, and casinos as part of outdoor Golden Knights viewing groups.