I attended the SBC Summit North America last week, a prestigious conference attended by many industry stakeholders, including bookmakers, investors and league officials. Here are three questions I came up with:
Why are some people upset with Mattress Mack?
Jim “Mattress Mack” McIngvale, owner of Houston-based Gallery Furniture, likes to make international headlines with multimillion-dollar bets to reduce the risk of advertising giveaways. They currently have about $4 million in bets on the Houston Astros to win the World Series at about 10-1. This bet is compatible with a promotion that gives customers who spend $ 3,000 or more of their money – if the Astros win the World Series.
The advertising they receive on big, but not scary bets, combined with the benefits they get from sportsbooks, drives some bettors crazy.
McIngvale doesn’t hide what he’s doing and he didn’t during Wednesday’s keynote interview. Finally he said with a laugh, “I’m a huckster.”
The promotion generates sales from customers who may not have been ready for a new mattress but like to be connected to sports news and have access to free seats.
“Unless we do something that’s fun for customers, we can do business,” McIngvale said.
McIngvale said he was already sold through a potential $40 million win on the Astros World Series game that he placed in May with Caesars Sportsbook and WynnBET. He’s looking to get off the ground and repeatedly asked an audience full of bookies if they could take action. When bets are won, he will use the winnings to pay returns to his customers. Even losing bets — and many of them — generate not only sales but also great publicity. He said his marketing team estimates it has generated $20 million in advertising revenue.
This discourages some bettors, especially those who have been limited by sportsbooks. He sees his big wagers being published by the same books that won’t let him bet $100 a game and angers Mattress Mack for being able to bet so much. When asked about the tendency of sportsbooks to discount winning bettors, McIngvale said that, as a dealer, he did not understand why bookmakers would take such a heavy approach to winners.
“Open those windows,” he said. “Whenever I gamble, you advertise as much as you want and people can have a good life with what I bet on.
“I think the winners are the best advertisers in the world,” he added. “Winners make business.”
FanDuel’s CEO, Amy Howe, said at Thursday’s conference call that 25% of bettors who play with other offshore books do not get paid. Is that true?
The short answer, in my opinion, is no.
If a quarter of the bettors who played at sea didn’t get paid, there wouldn’t be many companies. In fact, there are still a handful of sportsbooks located in places like Costa Rica and Antigua that continue to serve US bettors.
However, the biggest problem with betting in an unregulated sportsbook is that if they don’t want to pay — for whatever reason, legitimate or not — there’s nothing the bettor can do except complain online. There is no way to return and stubbornness occurs, bettors and investors will confirm, even if they are less than 25% of all bettors.
Payment issues are a global concern. Pay-per-head sportsbooks often work on credit, and repayments are made person-to-person. Pay-per-head books use sites that are often offshore to place bets and settle privately, sometimes using cryptocurrencies. These are modern local books.
The recent crash in the value of the crypto currency, which coincides with the worst period for sports betting, has led to an increase in bets, multiple sources told ESPN. Even so, Mr Howe’s claim of 25% of bettors being frozen in an unregulated market is a huge one.
Are sports betting companies doing everything they can to tackle the problem of sports betting?
Again, in my opinion, no.
On Wednesday the sports integrity committee, which included representatives from the NFL, the International Betting Integrity Association (IBIA), PointsBet and the Global Lottery Monitoring System (GLMS), responded to the challenges facing the US market going forward. The good news is that the number of games that show suspicious betting is very low, less than 1%, according to Khalid Ali, CEO of IBIA.
Most of the attractions that attract questionable betting are grassroots events, such as minor league tennis and football. The bad news is that US sports bookies continue to bet on these unsafe events, instead of distancing themselves from the unregulated market by refusing to offer things like indoor tennis, football and table tennis.
“The question is, does it help?” Jake Williams, senior vice president of technology and operations at PointsBet, said that like sportsbooks they should stop betting on floor games. “Is this going to push someone to the average bookie, to the beach operator who offers? I think there is a reasonable limit to these questions. I think there is a good debate that needs to be where the line is and where the line is. dark.”
Ludovica Calvi, president of GMLS, added that after licensed sportsbooks in Europe stopped betting on smaller events, it led to similar activities taking place in the illegal market.
“As long as you can control and monitor in a controlled environment, you’re safer than having anything underwater,” Calvi said. “It is not through prevention that you achieve and find a solution. It is through education and prevention.”
These are valid points, and I would add that if US sportsbooks eliminated betting on high-stakes events, matchmakers could stop and spend more time focusing on major leagues such as the NFL, NBA, NHL and Major League Baseball.
However, without liquid betting markets in low-level tennis, there would be no incentive for match-fixers to try to manipulate players and umpires. This is where the world’s largest betting companies, which offer access to hundreds of sportsbooks, including some in gray markets, can help. Independent sportsbooks cannot provide the necessary information to create odds for low-level tennis or soccer. They rely on data providers to provide challenges. If the opportunity is not provided, it is possible that the books stop offering the event or, at least, reduce the betting limit.
American bettors can expect to have access to licensed betting exchanges from the time of football. Companies like Sporttrade and Prophet Exchange are working on compliance and plan to launch this fall in New Jersey.
Betting exchanges work differently than house bank sportsbooks. In exchange, traders can buy or sell game results, similar to trading. The exchange takes the role of trading. Betfair and Smarkets are examples of betting in Europe.