The Takeaway: The Good & Bad For March Madness Betting
Betting interest in college basketball is at an all-time high, according to estimates, amid gambling investigations and Kalshi's foray into allowing betting on NCAA games nationwide.
Some housekeeping: The Cashout will run over the weekend this week.
It’s an interesting time in sports betting as March Madness — one of the biggest gambling events of the year in the US — draws near. There’s more and more focus on the intersection of gambling and collegiate athletics in recent weeks. And it’s worth pointing out that the event is so popular because of betting on tournament brackets via office pools that has taken place for decades.
Let’s round up some news first. There are two estimates I’ve seen for the amount of betting on March Madness that agree on the top line:
“The American Gaming Association (AGA) estimates that Americans will legally wager $3.1 billion on the men’s and women’s college basketball tournaments this year, up from $2.7 billion in 2024. This growth underscores the expanding legal sports betting market and the growing trust in legal wagering options.
‘March Madness is one of the most exciting times in American sports, with fans fired up for both the men’s and women’s NCAA tournaments,’ said AGA SVP of Strategic Communications Joe Maloney. ‘As legal wagering expands across the U.S., more fans than ever have the opportunity to bet legally and responsibly.’” More here.
“Vixio forecasts that there will be $3.2bn in legal sports bets on the 2025 March Madness college basketball championship. … ‘With the NCAA actively advocating for a national prohibition on all college player props, but sportsbooks increasingly reliant on props as a key component of their broader betting product offerings, the industry and college sports find their relationship at an inflection point as March Madness tips off this year,’ James Kilsby, Chief Analyst, concludes.”
So, that’s the good news. The bad news? There has been a rash of investigations into men’s college basketball and reporting of gambling violations at colleges. This one doesn’t involve basketball, but there’s a new report today from the Austin American-Statesman:
“The Texas athletics department self-reported five NCAA violations related to impermissible sports wagering between July 11 and Nov. 4 of 2024, according to documents obtained by the American-Statesman. The documents, acquired via a public records request, redacted the names of the offending parties. Texas’ self-reporting entries listed two football players, a non-student-athlete associated with the women’s tennis program, a student assistant and an uncategorized athletic department employee as the violators.”
Meanwhile, we also have Kalshi getting into full-blown betting on college basketball games in all 50 states. More here.
So we have growing integrity concerns because of the volume and velocity of cases, even though it’s mainly being rooted out because of safeguards in place in the regulated market. We have the NCAA making a renewed push to ban all college betting or player props in the regulated space even as offshore betting, fantasy pick’em, sweepstakes sportsbooks and prediction markets would persist outside of proposed bans.
What’s it all mean? I am not sure I know, but it’s a confluence of events that comes at a particularly disruptive time in the US gambling industry.
I hope everyone enjoys their bracket contests, sports bets, fantasy player parlays, sweeps entries and college basketball event trading responsibly this March.
The Event Horizon
Here’s everything you need to know about prediction markets, via the weekly roundup at The Event Horizon:
Gambling news roundup
Could Missouri Sports Betting Be Set Up For NFL Launch? (Legal Sports Report): “With emergency rules off the table, the licensing rules go into effect Aug. 30. Getting the applications out early will help the MGC “ensure that the commission has time to properly review applications before decisions are made and temporary licenses are issued.” With efficient work, sportsbooks could launch by the time the NFL betting season starts Sept. 4.”
While Missouri is supposed to launch this year by statute, the state will unquestionably see a more successful launch if it goes live near the start of football season.
Maryland, Mississippi Advance Bills Banning Sweepstakes Gaming (Covers): “The push to ban sweepstakes gaming is picking up steam in two U.S. states.
The Maryland Senate passed SB 860 on the third reading with a unanimous vote of 47-0 on Wednesday and has been moved to the House of Representatives’ Ways and Means Committee. … Mississippi’s House of Representatives passed Senate Bill 2510 on Wednesday that would make sweepstakes gaming illegal in the Magnolia State by a vote of 83-19.
New sports betting book: “Losing Big: America’s Reckless Bet on Sports Gambling: In 2018, the United States Supreme Court opened the floodgates for states to legalize betting on sports. Eager for revenue, almost forty states have done so. The result is the explosive growth of an industry dominated by companies like FanDuel and DraftKings. One out of every five American adults gambled on sports in 2023, amounting to $121 billion, more than they spent on movies and video games combined. The rise of online sports gambling—the immediacy of betting with your phone, the ability of the companies to target users, the dynamic pricing and offers based on how good or bad of a gambler you are — has produced a public health crisis marked by addiction and far too many people, particularly young men, gambling more than they can afford to lose. Under intense lobbying from the gaming industry, states have created a system built around profit for sportsbooks, not the well-being of players.”
I’ll try to reserve judgment until I read the book. But I am initially annoyed by the blurb, which says $121 billion wagered in sports betting makes it bigger than a major part of the entertainment industry. People are not “spending” more on sports betting than they are on movies and video games combined. Gross revenue — just from the regulated industry — from 2024 was less than $14 billion. That’s the comp. Everyone understands you’re never winning money back from video games and movies when you buy a ticket or a game, right? If we’re starting with a baseline where we are purposely trying to conflate these two things, I am not optimistic about the final product. I’ll hope that the book is better than the blurb.
DraftKings Renews State Council Funding Program and Expands Responsible Gaming Initiatives (press release): “This Problem Gambling Awareness Month (PGAM), DraftKings Inc. (Nasdaq: DKNG) is reinforcing its commitment to Responsible Gaming through a series of initiatives and key milestones. The company is renewing its State Council Funding Program to further support nationwide resources, marking the one-year anniversary of its industry-first My Stat Sheet tool, and launching a national Responsible Gaming focused advertising campaign to raise awareness for responsible play. ‘At DraftKings, Responsible Gaming is fundamental to our mission, and we are committed to making tools, resources, and education available to all our players to help them play responsibly,’ said Lori Kalani, Chief Responsible Gaming Officer at DraftKings. ‘Through initiatives like My Stat Sheet, which provides players with their personalized play data, and our new national awareness campaign, we’re reinforcing the importance of responsible play. Additionally, with the renewal of our State Council Funding Program, we’re continuing to support organizations that expand access to resources and education for players, their families, and communities.’”
Key House Republican suggests tax hikes on cigarettes, weed and gambling won't make Ohio budget (Statehouse News): “Gov. Mike DeWine’s proposed tax increases on cigarettes, gambling operators and marijuana appear likely to be cut from the budget by members of his own party in the House. ‘House Finance Committee chair Brian] Stewart said on Thursday that he and most of his caucus don’t support the tax increases, but nothing will change until after Friday’s budget amendment deadline. ‘I don’t support these tax increases, and in my discussions with members, it’s clear that the majority of Republicans do not support them either,’ Stewart wrote in a text. ‘But we will not determine anything concrete relating to the substitute bill until we receive and deliberate on members’ amendments.’”
The PGA Tour's gamble: How the Tour embraced legal sports wagering and manages the pitfalls (Florida Times Union): "On that day in May of 2018, I think a lot of leagues had a decision to make," said Scott Warfield, the PGA Tour's Vice-President for Gaming. "They could sit on the sidelines or they could participate in the benefits while also protecting against the negatives, get closer to it and monitor it. It was a seismic moment for sports where everyone had to decide, 'are we going with where the world is headed?'"
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