The SBC Leaders podcast has returned and this time SBC’s VP of Growth & Strategy Americas, Sue Schneider, sat down with Joe Brennan Jr., Executive Chairman at Prime Sports and SBC Hall of Famer, to reminisce on the long road to a regulated online gaming market in the US.
After working at AOL, Brennan joined the Interactive Media, Entertainment and Gaming Association (IMEGA) which pushed for the legalisation of online gaming as the organisation believed that “anything that can be done in the offline world, you should be able to do legally in the online world”.
He described how he began to speak to legislators in Washington DC in 2008 and it would be another ten years before the repeal of PASPA in 2018, which greenlit the expansion of sports betting across the US.
Brennan was also involved in the process of New Jersey legalising online casinos in 2013 after winning a decision at the US Supreme Court. Legislators also had to overcome some of the fears that still plague new igaming states.
He said: “There was a lot of opposition to that because of a lot of the same notions that are facing the expansion of online casino in the US right now which are worries about cannibalisation. They still exist today.”
Brennan also talked about some of the important figures in the fight for legalisation in New Jersey including the lawyer Ted Olson.
He described how Olson recognised that PASPA, which effectively banned sports betting, gave power to professional sports leagues and the NCAA to block sports betting legalisation efforts and Olson was able to argue that this was against the constitution.
Brennan added: “I don’t think Ted Olson had a strong opinion about sports betting one way or the other. But it was that Congress essentially delegated a power that it did not have and took power away from the states and did so in favour of the sports leagues and the NCAA. I think that for him was really what drew him to that.
“Just because Congress passes a law, that doesn’t mean that it’s a good law. I think that’s something we recognised early on with PASPA. When you read it, it was kind of a granted statute built on feet of clay and that’s almost certainly what Ted Olson saw when Governor Chris Christie contacted him.”
Since the repeal of PASPA in 2018, 38 states have legalised sports betting and seven states have also established a regulated igaming market.
Brennan said that he didn’t expect the expansion of the regulated sports betting market to be so quick in the US. He also talked about some of the things that have been seen in the industry since 2018 that he wished he would’ve “spent more time on” during the fight for legalisation.
He said: “For instance, the really aggressive marketing and advertising of it. At the time I thought, casino advertising and lottery advertising were already so heavily regulated and we assumed that the same thing would apply if and when we were able to legalize this so I am very surprised at how it was essentially granted free reign.
“It was done under the false premise that the operators had which was that we have to build this market quickly. This market already existed, you had a huge illegal market and all we were seeking was to migrate it to a regulated market. This notion that they had to build this market from scratch was a false notion and I think that was a huge mistake. “
He added that the regulated market hasn’t done a good job of migrating players from the illegal to the regulated market which is why he helped found Prime Sports, which is currently available in New Jersey and Ohio.
“What has happened is that more UK style of betting which is very aggressive, going after small stake players and weeding out the ones that are either winners or could be dangerous winners,” explained Brennan.
“You have this orphan cohort of players that want to participate in this market but they’re being thrown out or not allowed in. We’re looking to convert the people who are still betting offshore or on the street because they haven’t found the product or the opportunity to get into the regulated market.”
