The football world was rocked this year as gambling became legal following the legalization of sports betting in New Jersey in April 2018.
Many major sports leagues and teams are now available for betting on, and the introduction of new betting products and lines has made betting more accessible than ever before.
It started with the New York Yankees hosting the Houston Astros in a game that went ahead of schedule due to bad weather. The game ended in a 24–6 victory for the Yankees, with baseball fans rushing to place wagers on the game’s final score.
After the game, fans at the stadium were able to use Twitter to place bets with the hashtag #YankeesWin, and the NBA and NCAA quickly followed suit, embracing this new industry. Within weeks, the NFL, NHL, and PGA also started allowing fans to gamble on their games.
While the numbers may still be meager, especially when compared to the billions wagered annually across the U.S. in the illegal gambling industry, the legal sports betting industry is booming, and experts predict that it will continue to grow.
A New Jersey Sport
The largest U.S. state, with nearly 10 million people, legalized sports gambling in April 2018, allowing residents to bet on sporting events through online platforms and brick-and-mortar sportsbooks.
Despite being one of the first states to legalize sports gambling, New Jersey was not necessarily where the industry would spawn. According to experts, the growth of legalized sports gambling in New Jersey was only made possible by the legalization of sports betting in neighboring Pennsylvania.
Pennsylvania is a previous dark-horse candidate for U.S. President, but Donald Trump carried the state by a 55 percent margin in the 2016 presidential election. Having supported Trump in the presidential election, it was only a matter of time before the President supported their favorite pastime of football, allowing sports books to open in the state and offering online betting platforms like BetNJ and DraftKings an opportunity to expand their businesses there.
Additionally, many of the state’s biggest professional sports franchises–the Pittsburgh Steelers, Philadelphia Eagles, and New York Giants–make regular appearances in the Pro Bowl and Super Bowl, attracting tourists and locals alike. The New Jersey Devils, the state’s most popular sports club, are even called the “Jersey-Wildcard” because of their successful play throughout the post–Great Depression years and their inclusion in the 1978 Stanley Cup Final against the Philadelphia Flyers.
The Legalization Of Gambling
The legalization of sports gambling in New Jersey was made possible by a 2015 referendum that amended the state constitution to legalize gambling and restricted where it could be located. The amendment legalized all forms of gambling, including sports wagering, leaving only the matter of where to place bets up to the state’s municipalities.
Before the amendment, New Jersey was classified as a “no wagering state,” meaning that any business that wanted to place a wager on sporting events had to do so illegally. After the amendment passed, New Jersey became the first state to legalize sports gambling; neighboring Pennsylvania quickly followed suit, implementing a similar system in 2018.
The legalization of gambling in New Jersey has not come without its critics. Arguments have been made that the move will only benefit the state’s professional sports teams, attracting more tourists and bolstering their bottom lines. There are also those that believe that legalizing gambling will lead to an increase in dangerous behavior, such as problem gambling and underage gambling. However, most experts disagree and say that the overall social and economic impact of gambling in New Jersey will be a positive one.
Gambling has been a part of sports since the 19th century. In the United States, state lotteries were initially used to fund schoolteachers and universities, and in the 1930s the Supreme Court ruled that states could use their general revenue to underwrite their lotteries.
In the U.S., legal gambling comes in three forms: pari-mutuel, lottery, and online sports betting. Pari-mutuel wagering occurs when gambling is integrated into an existing athletic event, such as the Kentucky Derby. Lottery wagering allows people to play for weekly prizes rather than placing bets on sporting events, and online sports betting allows individuals to place wagers on sporting events from the convenience of their favorite team’s website.
Forbes magazine has estimated that the global gambling industry is worth around US$16 trillion and is growing at a rate of about 4 percent annually. In April 2018, the World Bank declared that “competition in the gambling market will benefit consumers, with greater choice leading to lower prices and better value,” and that legalized sports betting would “create new business opportunities and boost economic growth.”
The Growth Of Online Gambling
The growth of legal and online gambling has hit several industries, as well as traditional brick-and-mortar sports books, because of the ease of play and access to customers. Because it’s much easier to access customers online, bookmakers are responding by lowering their fees and increasing their payouts, making online gambling more attractive to consumers and opening up new markets for business.
According to a report by the American Gaming Association (AGA), Americans spent over $92 billion on online gambling and esports activities in 2018, and this figure is expected to reach $136 billion by next year.
Additionally, the number of adults in the U.S. who play games or use online betting tools increased by 4 million between 2017 and 2018, according to the AGA. In response, the organization has forecasted an 11 percent increase in online gaming revenue and an 18 percent increase in esports betting revenue over the next five years.
The Economic Impact Of Gambling
The legalization of sports gambling in New Jersey has not come without its critics, but the overall social and economic impact of gambling in New Jersey has been positive. Studies have shown that legal gambling leads to an increase in consumer spending, particularly on luxury goods and services. Additionally, some economists predict that legal betting will lead to an increase in domestic and international tourism, with gambling being considered a “gateway” activity.
A study released in October 2018 by the American Gaming Association (which represents the gambling industry) showed that in New Jersey, legal betting led to a 5.7 percent increase in retail and food sector spending and a 6.2 percent increase in leisure and hospitality sector spending. The study also predicted that legal betting would “generate $28 million in tax revenue and add $13 million to $21 million annually to state coffers.”
New Jersey As A Global Tourism Destination
With all of these benefits, it’s not hard to see why New Jersey is considered a global tourism destination. The states’s beaches, famous for being one of the most beautiful places in America, attract tourists from all over the world. The geography of the Garden State provides its residents with fresh air and beautiful views of nature, attracting those looking for a relaxing getaway.
Additionally, many of New Jersey’s biggest attractions, including its boardwalk, are open all year round and allow for “year-round outdoor activities,” according to VisitNewJersey.com. The state is also home to iconic American institutions like The Prudential Center in Newark and the 161-year-old MetLife Stadium, the home of the New York Giants. This year, the state’s tourism industry celebrated the grand opening of the 1,000-room, $27 million Ocean Resort & Casino in Atlantic City. The resort offers guests 24-hour shops, restaurants, bars, and entertainment venues, in addition to more than 70,000 square feet of gaming space.
The Rise Of Esports
While the growth of online gambling has mainly affected the traditional sports betting industry, the expansion of esports gambling has had a significant impact across the industry, changing the way fans, streamers, and gamers interact with each other.
Earlier this year, the esports market was valued at about $17 billion globally, with North America being the largest market, followed by Europe. According to Forbes, esports will be the “next big thing” in gaming, with the industry growing at a rate of 28 percent between 2018 and 2020.
Additionally, the esports industry saw a boom in interest and investments in 2019, with the total market value increasing from $4.9 billion to $17.5 billion within a year.
Many professional sports teams have embraced esports as a legitimate sport, with the NBA, MLB, and NHL all hosting esports championships and teams, and supporting the development of professional players. Some teams even field complete rosters of players that compete only in esports competitions.