With the growth of Cantor Gaming and the aggressive push into the Nevada sports betting market by UK bookmaking firm William Hill we could be at the dawning of a new era of in the state’s sportsbook industry. Many of the changes will be technology driven and could include a greater array of online, telephone and wireless betting options for Nevada residents. Cantor Gaming’s books have already started to offer ‘in running’ wagering and betting through handheld mobile devices within the casino. The company is also looking to bring casino games into the hotel rooms of Las Vegas visitors and has backed a change in Nevada gaming regulations to facilitate this.
Nevada’s sports betting industry could also experience a trend that is, for lack of a better term, ‘retro’ in nature. With William Hill’s expansion into the Nevada market has come a good deal of speculation that the company will look to replicate many of the ‘player friendly’ components of the British bookmaking industry to give themselves a quick competitive advantage over rival firms. If this is the case, perhaps the most glaring difference between the UK and Nevada bookmaking markets is the ease with which a player can make a bet. This could result in William Hill ‘betting parlors’ appearing in Las Vegas neighborhoods along with Starbucks and In-n-Out Burger locations.
In the Las Vegas and Reno markets, non-casino bookmaking establishments—which once were referred to by the generic term ‘turf clubs’–are a relic of the past. The first legal sports betting in Nevada was offered by these free standing businesses in the early 1950’s and they—along with the men that ran them—were instrumental in the development of the sportsbook industry in the United States. In Las Vegas, the most important ‘turf clubs’ were Churchill Downs, Del Mar and the Rose Bowl. Not only did Jimmy ‘The Greek’ Snyder emerge from this milieu so did other pivotal figures like Bob Martin, Sonny Reizner and Frank ‘Lefty’ Rosenthal (who once had an ownership stake in the Rose Bowl Sportsbook). In 1975 Jackie Gaughan opened a sportsbook in the Plaza hotel downtown and by the 1980’s free standing sportsbooks were on the way out—Leroy’s evolved into the satellite business and eventually closed their downtown location (ironically pioneering the business model for the Cantors and William Hills of today) and the Reno Turf Club bit the dust about the same time. Today—with the exception of a few self service kiosks operated by Leroy’s—all of the state’s sportsbooks are inside casinos.
The marketplace in the United Kingdom has been centered around the concept of a ‘neighborhood betting shop’ in the 50 years that bookmaking has been legal there. Like their American counterparts, the industry exploded due to a reduction in their tax burden along with some other regulatory changes that allowed bookmakers to offer a better experience for their customers (for example, until 1986 bookmakers weren’t allowed to show televised games in their shops). With the growth of offshore and online betting options during the early part of this century, the British government continued to liberalize regulations governing bookmakers in hopes they could better compete in a changing marketplace. Arguably the most significant change came in 2002 when the government replaced the ‘betting duty’ that came out of a winning bet with a gross profits tax on bookmakers.
Today the British bookmaking industry has grown exponentially and is comprised of approximately 730 licensed bookmakers that operate around 8,700 betting shops. Some of the biggest players are Nevada newcomer William Hill along with Victor Chandler, Ladbrokes, and Coral Eurobet. Many experts consider British books the most ‘player friendly’ in the world. Obviously there are profound differences in how sports betting is viewed culturally in England but its ubiquity is staggering—according to the trade group the British Bookmakers Association 20% of all UK citizens place a bet at some point during the year which factors out to over 12 million people. The US sports betting market may have similar numbers but keep in mind that these are bettors who wager at regulated, tax paying establishments.
Cantor Gaming and William Hill rely almost exclusively on taking race and sports bets for revenue, and thus will want to maximize their volume in any way possible. Since there are no significant regulatory barriers to betting parlors it appears to be a foregone conclusion that either or both companies will explore that option. With Nevada’s unemployment rate among the highest in the US any ‘red tape’ they encounter will likely fall to the promise of new jobs and diversified growth in the gaming industry. The UK bookmakers’ ability to point out the 40,000 jobs they provide in their native country will be a tough argument to counter.
It’ll be interesting to see where the casino companies come down on the issue. On one hand, they’re happy to outsource their sportsbooks operations—and particularly for a yearly guarantee. On the other hand, sportsbooks to some extent serve the same purpose for them as buffets, volcanoes, fountains, shows and nightclubs—they create traffic which in theory creates more revenue in high margin areas like slot play. There are other constituencies that could have an issue with bookmaking parlors from neighborhood groups to labor unions.
The downturn in casino and tourist business in Nevada during ‘the Great Recession’ has been a wake up call to at least some in the gaming industry. Nevada is no longer the ‘only game in town’ when it comes to legalized gambling and now faces competition from other domestic markets (Atlantic City, Mississippi), Indian casinos, slots at horse racing tracks nationwide, foreign destinations like Macau and the burgeoning—and inevitably legal and regulated—online gaming industry. Nevada’s legal sports gaming is—at the moment—a unique selling proposition within the United States. A revitalized sports betting marketplace that includes bookmaking parlors would benefit not only the players but enhance the state’s reputation as the only North American destination for serious gamblers of all kinds.
284 total views, 2 views today