State lawmakers are working on a bill to bring full-scale sports betting to Ohio. That’s after the Supreme Court in May struck down a law that restricted sports betting everywhere except in Nevada. If it’s legalized, there will be big money in it for casinos, tax collectors, and app developers.
But advocates for problem gamblers, and experts who study gambling disorders, warn that making sports betting legal will likely increase the number of people at risk for gambling addiction.
Sports Betting Expands Beyond Vegas
For decades the only place you could legally wager on a basketball or football game was in Nevada. And to do it, you had to go to a casino “sportsbook”— in essence, a room where bettors sit in cushy seats while watching games on panoramic screens, and giant digital billboards tick out numbers to help them calculate how much they stand to win, or lose, on each matchup.
Kelly Stewart, a professional sports bettor, has spent hours of her life in sportsbooks in Las Vegas. “College football season, I have no life,” she said. “I’m working 65 hours a week.”
Call it gambling if you want, but there is a method to it, Stewart said. Each of her picks is based on strategy and hours of research.
“You need to be disciplined,” she said. “And as long as you’re on the winning side more than you’re on the losing side, you’re making money.”
Even though she lives in Vegas, Stewart said she doesn’t go to casinos much anymore. That’s because Nevada is the one state where mobile sports betting has been legal and widely available for several years. As a result, Stewart said she works from home most days. When she’s ready to bet, she simply opens one of several sports betting apps on her smartphone.
“It doesn’t make any sense to me to drive all the way around town to bet when [I] could just literally do it at the palm of [my] hand,” she explained.
So that’s a snapshot of sports betting in Nevada—totally legal and easy-to-do. Since the US Supreme Court in May struck down a law that barred states from authorizing single-game sports betting, more states are moving in that direction including New Jersey, which opened up sports betting to casinos in June and Ohio’s neighbors Pennsylvania and West Virginia.
So should Ohio rush in to join them?
“‘Cautious’ is I think, I think it’s the word I would use,” said Richard James, a psychology Research Fellow at the University of Nottingham in the U.K., where sports betting is already widespread. He says policy makers ought to be particularly thoughtful about how they implement mobile sports betting, because unlike physical casinos, which you probably have to leave at some point, we hardly ever leave our phones.
“It can be a powerful tool to get people to gamble more frequently and perhaps more than they might wish to at times,” James said.
How Winning Leads to Addiction
“You have all of these alerts come up, dings, buzzes,” said Dr. Heather Chapman, a clinical psychologist at the Cleveland VA hospital, which is home to the country’s oldest inpatient treatment program for gambling disorders. “That impacts your brain and your attention.”
Chapman says she isn’t against sport betting. But as the availability of sports betting expands throughout the U.S., aided by the accessibility of smartphones, Chapman said she expects the number of people who develop a gambling disorder will increase with it.
Studies show that populations that have easy access to gambling — for instance, by living near a casino — have higher rates of problem gambling than those who don’t, Chapman said.
Additionally, legalization will likely lead to more people trying sports betting for the first time. When you don’t have to go to some bookie named “Johnny Knuckles” to place a wager, she said, even your ever-law-abiding Aunt Gertrude may decide to get a piece of the action. Ironically, she says, the problem for many begins when they win.
“It starts a flood of dopaminergic activity, which is that feel good stuff in your brain,” Chapman said. In fact, the physiological response from gambling shares some similarities to cocaine’s effect on the brain, she said.
And for a some people, that feeling can lead to addiction. The Problem Gambling Network of Ohio estimates about 1-in-4 adults who gamble are addicted to sports betting, or at risk for developing an addiction.
Brian Borcziak, 35, who describes himself as a “recovering” problem gambler, was one such person. At his home in North Ridgeville, Ohio, he dug out a couple of mementos from his gambling days — a silvery coin he received on his first visit to a Gamblers Anonymous meeting in 2016 and a player’s card from a casino he used to frequent.
“They had Entry Level, Bronze, and Gold,” he said. “I got the Diamond Level, which is kind of ironic.” The Diamond level means that “you gamble way too much,” he said. By the time Borcziak sought treatment for his problem, he said he’d lost over $50,000 betting on sports and owed $100,000 to creditors.
Since first walking into a Gamblers Anonymous meeting two and a half years ago, he said he hasn’t gambled at all. In fact, he opted into a voluntary exclusion program, agreeing to be banned for life from all Ohio casinos.
By Ohio law, 2 percent of the state’s casino tax revenues each year are funneled toward programs aimed at treating or preventing gambling addiction. In 2017, the amount was roughly $5.3 million.
Lawmakers and interest groups in Ohio are discussing legalizing sports betting, and Borcziak said he’s concerned that if sports betting becomes more available, people who otherwise wouldn’t have the opportunity to gamble, could find themselves in a spiral of addiction.
“It creates the opportunity for more problem gambling,” he said. “Just like me, I started casually.”
Billions on the Table
In 2017, legal sports betting operators in the United States brought in an estimated $270 million in revenue, while black market operators saw about $2.5-$3 billion in revenue, according to a report by the research firm Eilers & Krejcik Gaming.
Now that the ban on sports betting in most states has been struck down, “you’re going to have a far larger market,” said Chris Grove, Eilers & Krejcik’s managing director.
And it’s not only casinos and online sportsbooks that are well-positioned for the trend, Grove said. Mobile app developers will benefit, too.
“Betting is no different than almost every other consumer activity,” he said. “Grocery shopping, banking, dating. All of these things happen via mobile devices.”
And although various factors — such as the legislative process, high taxes and licensing fees, and clashes among industry stakeholders—could slow the adoption of sports betting, the momentum among states towards legalization is an opportunity for app developers, gaming companies, and tax collectors.
If all 50 states legalized sports betting, Grove figures that operators would generate between $7.1 and $15.8 billion in annual revenue, with at least half of that business coming from mobile.
Still, advocates for problem gamblers, warn that putting sports betting at more people’s fingertips increases the likelihood that some of them will develop a gambling addiction.
Derek Longmeier, executive director of the Problem Gambling Network of Ohio, said mobile betting may prove more difficult for regulators to control than wagering at casinos.
If sports betting is tied to a physical location, casino operators can screen out people who are underage or those who have opted to self-exclude. However, Longmeier worries that on a purely mobile betting platform, those rules may be easier to get around, for instance, by creating alternate accounts.
Before Ohio rushes to adopt mobile sports betting, Longmeier said, “I’d want to see what other states are doing and how we can learn from them.”