Column: Bookies go from pariahs to partners in NBA deal
LAS VEGAS— As revenue goes it barely registers on the books. The NBA probably gets more from the contract with its frozen daiquiri vendor than it does the new deal it inked with casino giant MGM Resorts International.
With good reason. The deal announced with such fanfare Tuesday is arguably little more than a branding exercise — at least for now — and a chance to take baby steps into a sports betting partnership that would have been almost scandalous only a few years ago.
Still, the NBA is now officially all in on sports betting. Other leagues will soon, undoubtedly, follow.
And sports may never be the same again.
Forget the image of a shadowy figure in a back room somewhere taking bets over the phone. Indeed, if the bookie you’ve used to make illegal bets over the years hasn’t made plans yet to get into another profession, you might suggest that it’s time.
Things figure to change in Las Vegas, too, if not all that much. Books in this gambling city have already expanded their offerings in recent years to include the in-game betting that the NBA believes will prove the need for its official data.
But the official seal of approval apparently means something, at least to MGM. So, too, might the official data the league provides at some point in the future.
And now that MGM has a deal with the NBA, surely the NFL and Major League Baseball are going to want in on the action.
Credit NBA commissioner Adam Silver for inking a deal he called “a leap of faith on both sides.” Silver realized early on that legalized sports betting was an opportunity for the league, not something to fear.
And when his idea of an “integrity fee” paid to the leagues out of sports betting revenue failed to gain traction in the early adopting states, Silver pivoted to find another way to get a piece of what figures to be a huge revenue stream.
He quickly found the perfect partner in MGM, which might have some ulterior motives of its own. The company wants an NBA team for its new arena on the Las Vegas Strip, and there’s no better way to curry favor with the NBA than ink a deal with the league.
According to Silver and MGM officials, the casino company is buying data. And the party line is that it’s important, despite the fact Vegas bookies have prospered for decades without any need for official league statistics.
“I know the value of data,” MGM chairman and CEO James Murren said at a New York press conference with Silver. “To be able to have the official NBA data for sports bettors around the world is very valuable. I was willing to, and I’ve paid for that.”
The money MGM paid isn’t much in the grand scheme of things, a few million a year over three years, according to reports. But if the NBA can convince other sports betting operations to sign up it could turn into a steady chunk of extra income for the league.
Not exactly the 1 percent of gross income the NBA was seeking from states considering legalizing sports betting, but that effort was going nowhere. In signing a deal to provide unspecified data to casinos, the league gets to profit from betting without getting hands terribly soiled with the actual messiness of it.
And new money is new money.
“This is a whole new world for us,” Silver said.
It’s hard to imagine that it was just a dozen or so years ago when the NFL refused to run an ad promoting Las Vegas on the Super Bowl, using the farcical argument that any association with gambling could ruin the league.
With the Supreme Court decision in May opening the door for legalized sports betting across the country, though, all bets are off. Instead of treating sports books like threats, the leagues are looking at them to boost profits.
What they see should have been apparent years ago: Americans want to be able to place a wager or two on their favorite teams, and they don’t feel there’s anything immoral about it.
In a perfect world, the bookies would go at it alone. They wouldn’t partner with the leagues that spent years trying to destroy them.
But for MGM, at least, it’s a marriage of convenience. The casino giant is betting the NBA will help spread its brand, and maybe even pave the way for an NBA team in Las Vegas in the near future.
And that’s a bet that just might pay off.