First year of mobile sports betting in Maryland generates revenue … – Baltimore Sun

Once sequestered to the desert of Las Vegas, whispered about over pay phones, and deemed to be a threat to the integrity of football by the NFLs commissioner, the practice of betting on sports has escaped ostracism and emerged as a ballyhooed favorite of sports leagues and fanatics.

For decades, only racetracks and Las Vegas allowed sports gambling in the U.S. Pro leagues were so wary that they refused to even place a team in Sin City, lest athletes get caught up in the unseemly habit. In a 2012 court filing, NFL Commissioner Roger Goodell formally opposed the spread of sports betting.

But a 2018 U.S. Supreme Court decision opened the door to widespread sports wagering. And as a new revenue stream for casinos, leagues and states and a new source of entertainment for fans, sports betting quickly proved a coveted debutant. What was taboo became ubiquitous: 38 states have legalized it in some form. In Maryland, there are 13 retail sportsbooks and 12 mobile operators. The Ravens and Orioles both have partnerships with sportsbooks.

The sports world ... went from, Gambling is bad, we dont like this, we dont want this, to every other commercial is promoting some sportsbook, said Sean Jones, a Howard County resident who occasionally bets on sports.

It was first legalized in Maryland in 2021, with online wagering starting in November 2022. In the year since, it has entertained bettors across the state to the tune of a predicted $4 billion in bets. With 15% of sportsbooks profits going to the state, its expected to raise at least $40 million for public education in its first year.

But increased access to a popular new national pastime raises questions about addressing the potential for more people developing an addiction to betting. The growing mobile sports industry doesnt contribute to the Maryland Problem Gambling Fund. And a new player on the horizon internet gambling could broaden the pool of people whose habit becomes self-destructive by making casino games available online.

Monitors display schedules and games at a casino. (Karl Merton Ferron/The Baltimore Sun)

The New York Giants recently played the Washington Commanders in the worst, in terms of win-loss records, matchup of the NFLs Week 11.

But Jones likes football enough that the unappetizing matchup didnt bother him. Whatever game is aired, hes content to watch. And this year, hes been even more engaged. Hes not much of a gambler and has never walked into a sportsbook, but with the advent of mobile sports betting, he likes to place tiny bets on his phone maybe $2 each to add some drama.

A couple of bucks, just for some fun, just for a little extra bit of excitement, he said.

Sports gamblers used to have to illegally use a bookie, which is what Billy Small, of Baltimore, was used to. After a long launch process in Maryland, he was happy to begin betting legally on his smartphone.

The ease of betting on an app is an enticing new option. Last month, 96% of the sports betting handle (the total of money wagered) came from online bets, as opposed to just 4% from physical sportsbooks.

Sure, you can bet on the Orioles to win the 2024 World Series or the Ravens to win Dec. 10. But you can also put the price of a cup of coffee on an otherwise unremarkable football game that, suddenly, you have a stake in.

Kevin Green, a Virginia resident and Ravens fan, said he doesnt like betting on the Ravens (I dont want to be mad about two things if they lose), but he wagers on other NFL games.

If you do it responsibly, it gives you another layer of fun to the viewing experience, he said.

That excitement has attracted many. More than 73 million Americans were expected to bet on the NFL this season, according to a survey from the American Gaming Association.

But bettors dont have to stop there. They can also wager on whether a middling NBA player will have at least 3.5 rebounds. Or who will win an upcoming game of snooker. Or, as of earlier this year, pickleball.

Gamblers can also place parlays a bet requiring a combination of outcomes that is less likely to occur, but which yields a larger prize. Those wagers offer tempting rewards, but rarely pan out. Theyre generally moneymakers for the sportsbooks.

Those types of bets give pause to people concerned about the future of sports betting and its effects. In October a month that featured five Sundays of NFL games Maryland had its most successful sports betting month, generating $5.8 million in revenue for the state. The other side of the coin is that Marylanders lost $39 million in betting on sports during the month.

It does make it easy, Jones said of betting on ones phone. And it makes it more dangerous, I think.

Eight states have legalized 'iGaming,' which allows adults to play casino games on their phone. Maryland could be next. (Canva)

One of the greatest advantages of legalized sports wagering aside from regulating what had previously been a black market is that it raises state revenue. Before mobile wagering was legalized, the research firm Eilers & Krejcik Gaming predicted that Maryland would bring in $26 million in sports betting in 2023 and then increase from there.

Next fiscal year, Maryland will likely generate around $45 million for education, Maryland Lottery and Gaming Control Agency Director John Martin said. In the grand scheme of the states $63 billion budget, that contribution is a drop in the bucket (less than 0.1%), but every million helps.

In addition to money for the state, sportsbooks have made hundreds of millions of dollars in revenue.

However, no mobile sports wagering revenue goes to the states Problem Gambling Fund, which finances education on responsible betting and support for those facing addiction. People who seek support for gambling problems receive free treatment in Maryland via the fund.

During a General Assembly committee hearing last month, legislators discussed a potential slippery slope facing the state: Online sports betting is becoming more popular, but is not legally required to contribute to the fund. Instead, slots and table games at casinos finance support for problem gamblers. So, while more people have access to gambling and do it on their phones, the fund hasnt received extra money.

Online and mobile gambling is creating, I think, I dont know if I want to call it a burden, but its certainly stretching the resources we have currently, Mary Drexler, director of the Maryland Center of Excellence on Problem Gambling, told the Joint Audit and Evaluation Committee. Its a public health issue. Relying solely on the casino table game taxes and [slot] taxes isnt going to carry us into the future, isnt going to allow me to expand our public awareness, to expand some of the staffing needed.

In the months since mobile betting began, Maryland has seen an increase in gamblers seeking professional help, especially among young men of color, but Drexler said in an interview that its too early to know whether the additional calls are a result of online sports wagering.

Legislative analysts suggested at the hearing that the Problem Gambling Fund diversify its revenue. That would likely mean requiring contributions from mobile sports gambling, perhaps as a result of action taken in the General Assemblys 2024 session.

We want to do so much more with public awareness campaigns and keep them going through the year, Drexler said, but we dont have the funding that the sports world has that can spend millions and millions of dollars to get the message out on betting.

Democratic state Sen. Clarence Lam, who represents portions of Howard and Anne Arundel counties, is a physician. (PAMELA WOOD/Baltimore Sun)

The success of online sports betting has prompted some states, like Maryland, to consider internet gambling, or iGaming, as its sometimes called. Eight states have legalized it.

I think the success of sports betting is sort of pushing legislators to say, Hey, look, were making some decent money with sports betting. We could be making more with iGaming, said Robert Linnehan, a sports betting regulation reporter at XLMedia and Sports Betting Dime.

State senators in Maryland proposed a 2023 bill to legalize iGaming, although it did not pass. Also, the state gambling agency retained a consultant, The Innovation Group, to study the topic for a report published this month.

While opponents of iGaming point to its dangerous accessibility someone could, while sitting on their couch, quickly lose thousands of dollars on cellphone roulette proponents note it could be another strong public revenue stream.

The consultant predicted in its report that, if legalized in the coming years, iGaming could amount to $900 million in gross revenue by 2029. Depending on how much of that casino win the state would tax, it could generate as little as a few million dollars annually or as much as $300 million, the consultant found. The profit margins for iGaming for states and casinos are better than for sports betting, so the addition of iGaming could be lucrative.

However, legislators on the legislatures Joint Audit and Evaluation Committee expressed caution at last months hearing.

I think we really need to slow down and take a good look at this, said Del. Steve Johnson, a Harford County Democrat.

Feedback provided by Marylands problem gambling center in the report to the state gambling agency detailed that most studies have found online gambling to result in more issues than in-casino wagering. The report stated the convenience factor of online gambling cannot be overlooked as a reliable predictor of problem gambling.

Sen. Clarence Lam cited that factor as a potential hazard. He co-chairs the committee, represents parts of Howard and Anne Arundel counties, and is a doctor.

If you were to open up more internet gaming, the equivalent of slot machines on your phone, at home, he said, it will probably lead to more Marylanders experiencing problem gambling, as well as a reduction in revenue at our casinos.

Legalization of iGaming could be a topic for the General Assembly in the session that begins Jan. 10. If legislators consider it, theyll have to weigh potential dangers against potential revenues, as online sports wagering marches into its second year.

Ive lost more than Ive won, for sure, said Green, the Ravens fan. But I still find it to be fun.

Baltimore Sun reporter Jacob Calvin Meyer contributed to this article.

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First year of mobile sports betting in Maryland generates revenue ... - Baltimore Sun