Legal sports betting in the US – Affiliate insights

The decision by the United States Supreme Court to open the door to legal sports betting in the U.S. sent shockwaves through the global gambling industry, creating a new era of opportunity for a wide array of stakeholders: Operators, suppliers, data companies, and – of course – affiliates.

While much of what works for sports affiliates in markets outside of the U.S. will translate relatively cleanly to the U.S. (adjusting for the preferences of American sports fans), there are a few unique aspects of the impending U.S. market for legal sports betting that affiliates should consider when planning for the opportunity.

Online sports betting may open up slowly

Sports betting at casinos and similar outlets like racetracks will likely kick off before the end of the summer in several states (Delaware, Mississippi, and New Jersey are likely to be first out of the gate). But online sports betting will lag behind land-based sports betting, perhaps significantly.

  • Delaware will likely have some form of online sports betting, but the details on when it will launch and how it will operate are still to be determined.
  • Mississippi has no plans to add online sports betting in the near-term.
  • New Jersey will probably authorize online sports betting in addition to land-based sports betting, but will take longer to launch online sports betting due to the additional regulatory details and approvals necessary before sports betting can move online.

Those three states provide a handy snapshot for appreciating how land-based sports betting and online sports betting will likely diverge as more and more states move forward with legalizing sports betting. Some states will launch online sports betting fairly close to their land-based launch, others will plan for online sports betting but in a later phase, and others will postpone online launch indefinitely.

The impacts for affiliates: Study the states so you can appreciate what markets are and aren’t worth your time preparing for. Adjust your sense of the scale of the opportunity based on a realistic projection of how much of the market will actually be available for affiliates. 

Licenses will be a necessity

I expect regulated online sports betting in the U.S. to closely follow the template set by the legal online casino market in NJ. If that ends up being the case, then affiliates will need to have some level of licensure in order to participate in the regulated online sports betting market.

Licensing isn’t necessarily the intimidating process you might expect. It all depends on the nature of your relationship with an operating partner, and the rules of a particular state.

If you’re working on a CPA basis with a partner, then the level of required licensure will definitely be lighter than if you were working on revenue share. You’ll still want to consider working with a local lawyer who has experience to ensure that you navigate the process correctly, and you may face some costs and delays, but the process will be manageable for most affiliate companies.

If you’re working on revenue share, things get far more involved. In almost every state, sharing directly in the revenue generated from gambling requires you to have a far higher level of licensure. You’ll almost certainly need an experienced lawyer, access to a substantial amount of information about your financial past, and a great deal of patience.

One other twist: New Jersey was very clear about forcing affiliates to make a choice between regulated online gambling markets and offshore sites serving the U.S. market. Other states will force you to make a similar choice, if you haven’t already.

The impacts for affiliates: Start preparing to navigate the license process if you’re planning for a major push into the U.S., and carefully examine your portfolio for exposure to sites serving the U.S. market illegally.   

A different competitive landscape 

One of the great things about being a casino affiliate is that you don’t really face much competition from mainstream media sites. Sure, casino coverage is part of the business news beat for a typical outlet, but there’s plenty of white space around the topic for affiliates to occupy.

Sports betting is different, and perhaps even more so in the U.S., where there is already an excess of sports content relative to demand. There is simply no lack of people willing to talk about sports, write about sports, or debate about sports, resulting in a deluge of content that makes it harder for you to break through without doing something unique.

There’s also the threat from your sports media incumbents who are looking hungrily toward the sports betting opportunity. Sure, you can rank for a PokerStars review term, but will you be able to rank for an MGM sportsbook review term if Barstool, ESPN, Fox Sports, and Yahoo are all competing for the same terms? What kind of content edge will you be able to execute over companies with massive staff and resources?

The impacts for affiliates: Start brainstorming now about what you can do to stand out in an incredibly crowded field. Study your competition for insights about where they are – and where they aren’t – to build a plan for where you need to be in order to secure a viable foothold in the market.

About the Author:

Chris Grove is a consultant to Catena Media, a publicly-traded company specializing in online gambling lead generation. Catena acquired the network of sites Grove co-founded – including TheLines.com and PlayUSA.com – in 2017.