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UK wagering companies bet on US after sports betting wager ruling
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5 June 2018
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By Natalie Sherman
Business reporter, New york city
It's high stakes for UK companies as sports betting wagering starts to spread in America.
From Tuesday, new guidelines on sports betting entered result in Delaware, a tiny east coast state about 2 hours from Washington.
Neighbouring New Jersey might begin accepting sports betting bets as early as Friday.
The changes are the very first in what could end up being a wave of legalisation after the Supreme Court last month cleared the way for states to permit sports betting.
The market sees a "as soon as in a generation" chance to establish a new market in sports betting-mad America, said Dublin-based financial analyst David Jennings, who heads leisure research study at Davy.
For UK firms, which are facing combination, increased online competition and harder rules from UK regulators, the timing is particularly .
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But the industry says relying on the US remains a risky bet, as UK business face complicated state-by-state guideline and competitors from established regional interests.
"It's something that we're truly concentrating on, however equally we do not want to overhype it," stated James Midmer, representative at Paddy Power Betfair, which recently purchased the US fantasy sports betting website FanDuel.
'Take some time'
The US represented about 23% of the world's $244bn (₤ 182bn) in video gaming revenue last year, according to a report by Technavio, external released in January.
Firms are intending to tap into more of that activity after last month's decision, which struck down a 1992 federal law that disallowed states beyond Nevada and a few others from authorising sports betting wagering.
The ruling discovered the law was an over-reach of federal power. But the court it did not in fact legalise sports betting wagering, leaving that concern to regional lawmakers.
That is expected to result in significant variation in how companies get licensed, where sports betting wagering can take place, and which occasions are open to speculation - with huge implications for the size of the market.
Potential profits varieties from $4.2 bn to nearly $20bn every year depending upon elements like the number of states move to legalise, Oxford Economics estimated in a 2017 study for the American Gaming Association.
"There was a lot of 'this is going to be big'", stated Will Hawkley, London-based head of leisure for consultants KPMG.
Now, he stated: "I think the majority of people ... are looking at this as, 'it's a chance but it's not going to be $20bn and it's going to be state by state and it's going to take time'."
'Remains to be seen"
Chris Grove, managing director at Eilers & Krejcik Gaming, anticipates that 32 states will legalise sports betting in some kind by 2023, creating a market with about $6bn in annual profits.
But bookmakers face a far different landscape in America than they perform in the UK, where sports betting stores are a frequent sight.
US laws restricted gaming mostly to Native American lands and Nevada's Las Vegas strip till fairly recently.
In the popular imagination, sports betting has long been connected to a 1919 baseball World Series match-fixing scandal.
States have also been sluggish to legalise numerous forms of online gambling, despite a 2011 Justice Department viewpoint that appeared to get rid of obstacles.
While sports betting is typically seen in its own category, "it plainly stays to be seen whether it gets the kind of momentum people think it will," stated Keith Miller, law teacher at Drake University and co-author of a book about sports betting wagering regulation.
David Carruthers is the former president of BetonSports, who was detained in the US in 2006 for running an offshore online sportsbook and served jail time.
Now a consultant, he says UK firms must approach the market carefully, choosing partners with care and preventing bad moves that could cause regulator reaction.
"This is a chance for the American sports betting gambler ... I'm uncertain whether it is an opportunity for organization," he says. "It really is dependent on the outcome of [state] legislation and how the company operators pursue the chance."
'It will be collaborations'
As legalisation begins, sports betting companies are lobbying to ward off high tax rates, in addition to demands by US sports betting leagues, which wish to gather a percentage of profits as an "stability fee".
International business face the added obstacle of an effective existing gaming market, with gambling establishment operators, state-run lottery games and Native American tribes that are looking for to defend their turf.
Analysts state UK companies will require to strike collaborations, using their knowledge and technology in order to make inroads.
They indicate SBTech's current announcement that it is providing innovation for Kentucky Derby operator Churchill Downs as an example of the type of offers most likely to materialise.
"It will be a win-win for everybody, but it will be partnerships and it will be driven by innovation," Mr Hawkley said.
'It will just depend'
Joe Asher, president at William Hill US, is clear-eyed about the truths.
The company has been investing in the US market given that 2011, when it bought three US firms to establish an existence in Nevada.
William Hill now utilizes about 450 people in the US and has announced collaborations with gambling establishments in Iowa and New Jersey.
It works as threat supervisor for the Delaware Lottery and has actually invested millions alongside a regional designer in a New Jersey horse racing track.
Mr Asher said William Hill has actually become a household name in Nevada however that's not necessarily the goal everywhere.
"We definitely intend to have a really substantial brand existence in New Jersey," he said. "In other states, it will simply depend on policy and potentially who our regional partner is."
"The US is going to be the greatest sports betting market worldwide," he included. "Obviously that's not going to occur on day one."
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UK Betting Firms Gamble on uS After Sports Wager Ruling
daviddrennan81 edited this page 2024-12-31 18:03:58 +08:00