A recent US sports betting regulatory survey by SBC and VIXIO GamblingCompliance has revealed that the spread of New York’s high-tax model and an anticipated backlash on advertising are the prime policy risk concerns for the region’s market.
The findings of the second annual VIXIO GamblingCompliance and SBC US Sports Betting Regulatory Survey also showed that just over half of the 145 senior industry executives, regulatory officials, and legal advisors who participated expect sports wagering to be legal in 45 or more states by 2025, compared with 32 at the start of 2022.
21% of respondents in the survey selected high tax rates and license fees as the policy issue most likely to affect US market growth in future years, while 12-14% believe it will be either the slower rollout of igaming, the Wire Act, limited enforcement actions against offshore operators, or restrictions on permitted bet types or events.
Almost 28% of participants also selected the spread of New York’s high-tax model to other states as the most concerning from a list of hypothetical regulatory events.
Conducted in late 2020, the first VIXIO/SBC survey showed most of the industry’s concerns related to the 1961 Wire Act, which prohibits interstate sports wagering.
However, these worries appear to have faded following a favorable federal appellate court ruling that came on the same day as the inauguration of a Biden administration seen as less likely to clamp down on online gambling.
Commenting on the survey, James Kilsby, VIXIO’s Chief Analyst, stated: “The second VIXIO/SBC US Sports Betting Regulatory Survey showed a noticeable and understandable shift in industry sentiment on regulatory risks in the US market.
“Ten states passed laws on sports wagering during 2021 and they did so through a far more diverse range of regulatory models than in prior years, with New York establishing by far the most expensive US market to date in terms of tax rates and license fees, and another potentially lucrative market, Florida, seeking to grant exclusivity to the Seminole Tribe.”
Although sports betting is rapidly expanding across the US, it’s a different story for online casino and igaming, which only had a presence in six states at the start of the year.
25% of the survey’s respondents claim the slower rollout of igaming was due to the perceived problem gambling risks, closely followed by concerns of cannibalization of land-based casino revenue. 55% of participants expect igaming to expand to 10 or more states by 2025.
Regarding concerns related to advertising growth following the spread of online sports wagering, 65% of respondents said they agreed a policy backlash, similar to that currently happening in Europe, is unavoidable without industry efforts to proactively limit marketing efforts.
A full report on the survey’s findings, as well as a timeline of key regulatory events of 2021, can be downloaded here.
The second VIXIO/SBC US Sports Betting Regulatory Survey was conducted in the run-up to the 2022 SBC Summit North America event, which will be held on July 12-14 at the Meadowlands Exposition Center in New Jersey.
https://sbcamericas.com/2022/06/06/us-sports-betting-industry-concerned-about-possible-new-york-tax-model-spread/