At the heart of sports betting is the oddsmaker or bookie, who determines the odds on, say, an L.A. Chargers quarterback completing a pass in the third quarter of the game.
But what about the future of sports betting in the United States? GGB News recently asked three of the best oddsmakers in the business—Roxy Roxborough, John English and Vic Salerno—to look at the field, assess the competitors and share their predictions.
An Ancient Art
Michael “Roxy” Roxborough was enjoying a beach view in Thailand, where he’s riding out the Covid-19 pandemic, when he spoke to GGB. A syndicated columnist, teacher, author and mentor to other oddsmakers, Roxborough is credited with introducing mathematical formulas and computer models to the ancient art of setting odds. These days, he’s semi-retired.
Asked where he thinks sports betting will be in one, two and five years, Roxborough said, “Before two years, I don’t see much changing. You’ll end up with a lot of different players like you do now, lotteries and some with private companies like DraftKings and William Hill. The way I see the business, it’s going to fragment.”
But in five years, he said, “It’s a strong favorite that there will be consolidation. There are too many players in the industry, and it’s not going to be profitable for some. The big companies might buy out the smaller ones, and some might go broke. The industry fragments into two types: one is the Las Vegas model, where they take large bets, and some will be driven to small online bets. In game wagering, that’s the model that DraftKings and FanDuel are doing now.”
He added, “Sports betting in states driven by lotteries will just hang out and survive. The lotteries are not going to take over this business. They have a monopoly, and that’s all they have going for them.”
California, said Roxborough, “is a wild card. The tribes will probably drive a lot of the outcome in what happens; I don’t know if that’s good or bad. California, here’s a prediction: A competitive robust California sports betting market would make Nevada’s redundant.”
Asked how mobile apps have changed the game, Roxborough said, “Completely. The business isn’t the same with brick-and-mortar casinos. It might be the same product, but it’s night and day.
“Mobile betting can operate at low expense and drive a pretty good profit with small or even micro-bets. A lot of people will be betting in-game, 50 cents and a dollar on every pitch in a baseball game or every shot in a golf tournament or every ball down the court. The bookmaking will shift to micro-bets, which are kind of like penny slots. People will make hundreds, even thousands of small bets during the course of the game.”
Will having a robust sportsbook in virtually every state in the U.S. be good for oddsmakers? “Oddsmakers are kind of a dying breed,” observed Roxborough. “I don’t think it’s a viable business now. I started one that dominated Nevada for 90 percent of the books, but that was then. People need information, but they don’t need people to make the opening line. They need feedback.
“The low cost of technologies has driven that business, so you can see for free what everybody else’s odds are.”
John English is managing director of sports betting and technology for Global Market Advisors, specializing in global business development for the sports betting industry. Right now, like a lot of people confined by the pandemic, English is operating out of his home.
Asked about the near-term future of sports betting in the U.S., he said, “We launched the first mobile betting app in Nevada; in states that allow for mobile wagering, that’s where the growth is going to be. It could double in the next year, depending on where you are.”
He recalled the massive amount of betting on Super Bowl LIV in New Jersey, which probably has the most robust mobile sports betting market. “In Nevada, I’m looking at over $600 million in two months. Things were doing really well leading in to the pandemic.
“The good news is that I see a bright future for sports betting. We’re looking at several states that have sports betting legislation in place, and for the next few years, things will get better. California has promise, and that’s going to be a huge boost—right now, they’re trying to make it work. That’s a game-changer.
“And if for some reason Florida would open up, they already have pari-mutuel on humans, jai alai. (Sports betting) could double or even triple if you add those two states.”
But, he added, “The drive has to be mobile betting. It’s been growing year by year since it was launched in 2010. If you don’t have mobile and still have online, and you have to drive people to the casino, you’re creating an inconvenience. Sports bettors want instant gratification. That’s always been important to the punter.”
As a result, most states are adopting mobile sports betting, English said. “That’s going to make a big difference because of the pandemic. If there’s another wave of the pandemic, we may have to shift back. No one’s going to let sports betting die. We saw the suffering without gambling. States that have online gaming have benefited, because right now, there are no sports. If we see a second wave of closures, I’m a little concerned about that.”
Otherwise, English said the industry will return to where things stood right after the Super Bowl last February. “We had a wonderful lead-off. The Super Bowl was phenomenal, and everything was really bright going into 2020. If we can keep it under control and if states adopt sports betting, we’ll see it double or triple. States will have to be open-minded about it.”
He, too said mobile apps were “an absolute game-changer. We were the first to release it in 2010 on Blackberry. Since then, about 65 percent have started coming on mobile. It’s been holding strong, then growing. Growth is ultimately vital to sports betting. It always has been, since the minute we launched it. It’s the fastest growing sector of all forms of gaming.”
He agreed with Roxborough that oddsmaking is a dying art but added, “It shouldn’t be.”
“Technology is leading the way, but I still see oddsmaking as a necessary element. The various types of feed to computers do the consensus and analysis, but it’s always good to have a bookmaker look at that and say, ‘Shift that, and bring in the business.’ I saw that, as someone who used to work with whiteboards. Now everybody wants to computerize everything. They count more on tech than they do good old-fashioned ingenuity.”
He concluded on an upbeat note: “We’re seeing record numbers and it’s still growing. Once we get past this pandemic, we’ll be just fine.”
Vic Salerno has a unique take on oddsmaking. The president of USBookmaking and US Fantasy Sports, he’s the only bookmaker in the AGA Hall of Fame. His company manages sports betting for several tribal casinos, including Isleta Resort & Casino and Santa Clara Hotel Casino in New Mexico and Sky Ute Casino Resort in Colorado. Salerno is the only oddsmaker in the American Gaming Association Gaming Hall of Fame.
He told GGB News, “We’ve been in the business forever and we feel there is a niche now in tribal gaming for us. My wife is Indian, we’re always looking for new opportunities with tribes, and we feel there’s a bright future.”
Salerno, too, predicted that the sports betting industry is going to continue to grow over the next five years. “By next year, I see sports betting doing very well besides the states run by lotteries—which should stay in the lottery business. If lotteries run your operations, they have too high of a take-off and they can’t compete with illegal oddsmakers or offshore operators. That’s being proven in Oregon.
“In two years, we’re just getting going,” he continued. “In five years, it’s going to be a booming business, one of the biggest in the U.S.—if not the biggest. Once we get going again, with the NHL opening in July and if MLB opens, it’s going to explode. People have been frustrated. They have been reduced to betting on Russian table tennis and Korean baseball. There’s an appetite for it, and it should really expand.”
Asked about the odds of California getting sports betting by next year, Salerno said, “Not good. Tribes, racetracks and the card rooms have always been at each other’s throats. The race industry moves slow. The way it’s been presented, with no mobile wagering and no wagering on local college teams, they’re going down the wrong road.”
And if California has sports betting without mobile, he warned, “It will help illegal bookmakers.”
Addressing the objection of many tribal casinos that mobile sports betting will hurt their brick-and-mortar business, Salerno replied, “The sports player is not always a casino player. It’s not going to stop them from coming in. It’s not the same as having slot machines on a mobile app, which would hurt their business. We found here that it hasn’t hurt our retail across the counter. It’s even increased business in the casinos.”
Will having sportsbooks all over the U.S. be good for oddsmakers? “Yes,” said Salerno. “If we can go across state lines, it should really be better. The odds will be better and the swings won’t be as much, the win-loss won’t be as much.”