Very important column from Ethan that outlines A) the sports leagues want you to *lose* at gambling and the casinos help enforce that, and B) they don't care if you do lose, the more the better in fact.
Are you going to read this at espn.com?? Or The Athletic for that matter?
I'm opposed to sports gambling aside from office superbowl or NCAA $5 brackets because of the ruin it brings to far too many people. That, plus we're guaranteed a Black Sox sized scandal at some point with the gambling money rolling in right now. Some NBA sixth man, looking to make a little side $$ near the end of his career will tank some shots, or an NFL kicker on the way out who figures what the heck, time to shank while I can, are likely candidates for first dibs. Established superstars with gambling problems are next in line, and then we'll see if the NFL and NBA think it was all worth it.
Great piece Ethan. As a UK resident, I’ve always found the relentlessness of ringer/athletic gambling coverage a little mad given their progressive branding.
We have 450 000 kids gambling every week and around 450 suicides per year attributed to gambling addiction. It is every where and largely resented as a parasitical influence. Gambling addiction is no joke and the increasing number of triggers is worrying. Plus the constant ads and betting chat is really dull for non gamblers.
I want to point out that the fundamental argument of the legalization - this idea that "well they are doing it anyways" - is demonstrably false. Research indicates that the incidence of problem gamblers doubles when casinos are within 50 miles, so it would be reasonable to expect the Wizards to double the number of problem gamblers among their arena-going fans. That seems bad.
I'm a relatively new subscriber and I never comment on these posts because I feel like you say everything I'm thinking. But this was really good.
I truly believe we should legalize a lot of things, including gambling. But that's where society is supposed to be adding the appropriate opprobium to it. Instead we have these leagues and celebrities hawking this nonsense. And the mainstream coverage is progressively gambling oriented, which I find viscerally repulsive. The fantasy focused coverage was already bad enough.
This article from The London Review Of Books delves into the choices the British government made about gambling. I found its conclusion very fair: Legalize, but don’t promote:
Great piece as always. In Australia, after non stop betting ads during footy games, I chuckle when they add the “gamble responsible” line at the end. Full of crap.
It’s worse over in Oz because local sports clubs’ survival is almost entirely pinned to the revenue their pokie machines make.
There should be government intervention - this is exactly the sort of issue that requires it (spare me the socialism fear mongering that shows it’s ugly head here in the US for any sensible government intervention proposals)
Could it be that the sports gambling is just the NBA’s (and leagues at large) way to keep the viewers trapped in the attention economy casino, you know as a bulwark against their diving ratings?
There’s a point to be made (repurposing a Ben Thompson point here) that with centrally propagated mass media monoculture coming to an end with the fragmented distribution models of the internet, a content product stands to benefit from monetizing on “intensity” as opposed to gross ratings counts (say, some metric of time spent and engagement). Calculus-literate readers would recognize this as optimizing for area under the curve as opposed to optimizing for peak of the curve.
Oh man, I was wondering when you'd be getting to sports betting. I've taken an interest in it to the point where I even wrote a sports betting centric-novel ( The Sure Bet King , if you're interested), and this did not disappoint. Couple of things I want to say.
-I always knew that the house edge in sports betting had to exist even when I knew a lot less about it than I do now, and it looked like every piece of sports betting media WAS goading players into a stacked game. It turns out I was right-because a lot of personalities have affiliate deals where they can get people to sign up in exchange for a portion of their losses.
-For banning winners, I'm not really sympathetic towards most of the people who are banned/ultra-limited either. Most of the "advantage players" I've heard of are not handicappers but simply people who pounce on off/slow/etc... lines, or take advantage of bonuses/artificially good lines for the sake of promotion. They're also outright market manipulators who bet at the few sharp sportsbooks everyone else follows (Circa Sports and Pinnacle are the two most famous examples) to move the line and then wallop the slowest ones with their puppet accounts. At the very least, I can understand the book's perspective-they offer them nothing (while the handicapping originators can at least give them information on what a good line is) and are asking to essentially plunder as much as they can. It's an unsympathetic business all around.
-That being said, it is goading people into embracing a game stacked against them. Even the few sharp books that do allow winners come across as this, as it's even harder to win there (because of better lines you can't win via "coupon clipping", as one gambling tweeter calls it, in books where there are no coupons to clip)
-The ROI for the few winners is just not very good (effectively low single digits at best). The cost-benefit does not work out. You are putting in gargantuan effort (be it modeling or line munchkining while dodging the enforcers) to get something you could have for far less work and stress just by buying and holding blue-chip assets.
-The message is basically "use your knowledge of sports trivia and your gut to win big on your mega-parlay." This of course is false.
-For you in particular Ethan, you might like this claim of mine. I think the next big sports betting scandal won't be a Black Sox (players) or Tim Donaghy (refs) doing shady things, but a front office person betting using inside information (the Draymond Green prop mess has made me even more convinced of this).
-That being said, I do support legalized sports betting, just as how I support legalized gambling in general. There are responsible gamblers who don't really expect to win and don't overspend. But I have no illusions.
I think recreational bettors should welcome rather than resent the efforts of sports books to keep out the likes of Haralabos. Some econ 101: sports betting is an increasingly competitive marketplace. That means all the sites are going to be forced to give the bettors at least a roughly similar deal. If they save a bunch of money by keeping out successful professional bettors, much (most? all?) of that savings will go to the other bettors in the form of better bonuses, more generous boosted odds, other promotions, etc. (It's no different than saving money by switching to AWS or something. That's good for the customer, and so is this.)
This dynamic is very obvious in the context of daily fantasy, where most recreational bettors realized they were getting destroyed by professionals using sophisticated models and putting in enormous numbers of entries--not very fun to compete with that! It doesn't feel the same with sports betting, because you're nominally playing against the house rather than against other competitors, but the underlying economic reality is the same; allowing in professionals makes recreational bettors lose more, more quickly.
It's interesting to me that a discerning commentator like Ethan, like most others, has accepted the idea that keeping out the likes of Haralabos is some kind of attack on bettors more generally. I feel there has been a successful PR operation from the pro gamblers on this issue. They frame it the way Ethan did: sports books keeping us out means they'll never let you really win! But as Ethan should realize, recreational bettors like myself are never going to "really win" (in the sense of finding a consistent edge and using it to make a stable return) anyway. We won't make sports betting our full time job, we won't create sophisticated models, we won't hire research associates, etc. For us, cutting our losses by keeping out the sharps is a favor.
I'm a little surprised we haven't gotten a "Is sports gambling racist?" think piece somewhere yet, given the social dynamics of (mostly white) fans and (mostly Black) athletes.
Educated people won’t even talk about the obvious link between weed de-crim and the homelessness epidemic. Fat chance getting them to be honest about legalized sports betting.
I have zero problem with casinos turning away people who would not be profitable to them. If these sharps want to make money with their expertise they can set up their own books and take best from the public. They don't want to do the work, so fuck em.
However, Ethan is right about you never hear about the addiction aspect and how to prevent the societal downsides as much as possible while letting the free market work. Right now, it is privatized gains, public loses. Society has to deal with the costs of addiction like bankruptcy, crime, broken households, etc.
Legalization doesn't have to mean a free for all.
This has been the issue with any vice in history. For example, by my old apartment in Denver. There would be alcoholics just waiting outside the local liquor store to open up so they can go in and buy those cheap shooters behind the counter that no one else buys except alcoholics. The liquor store makes a crazy profit off these people but the city is left to deal with the fall out that is millions of dollars in city services.
People are starting to realize this when Colorado legalized pot. That maybe having little regulation but letting for profit companies be the distributors is bad. 99% of pot smokers are totally fine and follow the rules, but there is no central tracking database between pot shops to see if people are buying over the limits. So buyers could go from pot shop to pot shop buying the max and then take it and sell it over state lines or to kids or whatever.
Adding a gambling helpline isn't going to do shit, nor do I think a quick chat with a government worker is going to do it. The states need to create rules where if a person wants to bet, they need to submit a tax return and a paystub and they are approved for a specific limit that is shared between ALL gambling locations. If the bettor has a partner, the partner should have the ability to get access to statements and notified of any major changes in betting patterns.
This sounds like a hassle and that's because it is. People who want to bet for enjoyment will still be able to but it will minimizes the public's risk & cost. Sure some gamblers will turn to the black market but that was the way before legalization, at least this way, society can set the terms somewhat.
Man, anyone that's logged into any of these online sports books or seen the TV ads knows it's all targeted to loot you blind. MGMBet has a parlay generator to just YOLO your money out there and most of the ads promote the ability to have a near infinite amount of preposterous bets going simultaneously. It's a far cry from getting grandma to put down $10 or $20 on her beloved Bucks.
Good stuff Ethan. I've been learning a lot about sports gambling since it became legal in my state in 2020. This piece covers what's going on.
I've said this elsewhere, but: I wonder if the sports betting bubble will burst in a few years after casual bettors realize they are consistently losing their money. Sports wagering isn't as easy as it looks. Even sharps win only 55% of the time (on what they can get down, as you wrote). And all the "fun" bets that these sportsbooks like to promote -- parlays, boosts, "risk free" wagers -- are actually big time sucker shit.
Very important column from Ethan that outlines A) the sports leagues want you to *lose* at gambling and the casinos help enforce that, and B) they don't care if you do lose, the more the better in fact.
Are you going to read this at espn.com?? Or The Athletic for that matter?
I'm opposed to sports gambling aside from office superbowl or NCAA $5 brackets because of the ruin it brings to far too many people. That, plus we're guaranteed a Black Sox sized scandal at some point with the gambling money rolling in right now. Some NBA sixth man, looking to make a little side $$ near the end of his career will tank some shots, or an NFL kicker on the way out who figures what the heck, time to shank while I can, are likely candidates for first dibs. Established superstars with gambling problems are next in line, and then we'll see if the NFL and NBA think it was all worth it.
Great piece Ethan. As a UK resident, I’ve always found the relentlessness of ringer/athletic gambling coverage a little mad given their progressive branding.
We have 450 000 kids gambling every week and around 450 suicides per year attributed to gambling addiction. It is every where and largely resented as a parasitical influence. Gambling addiction is no joke and the increasing number of triggers is worrying. Plus the constant ads and betting chat is really dull for non gamblers.
I want to point out that the fundamental argument of the legalization - this idea that "well they are doing it anyways" - is demonstrably false. Research indicates that the incidence of problem gamblers doubles when casinos are within 50 miles, so it would be reasonable to expect the Wizards to double the number of problem gamblers among their arena-going fans. That seems bad.
I'm a relatively new subscriber and I never comment on these posts because I feel like you say everything I'm thinking. But this was really good.
I truly believe we should legalize a lot of things, including gambling. But that's where society is supposed to be adding the appropriate opprobium to it. Instead we have these leagues and celebrities hawking this nonsense. And the mainstream coverage is progressively gambling oriented, which I find viscerally repulsive. The fantasy focused coverage was already bad enough.
"to help them understand the process and make it friendlier" Gross.
This article from The London Review Of Books delves into the choices the British government made about gambling. I found its conclusion very fair: Legalize, but don’t promote:
https://www.lrb.co.uk/the-paper/v36/n16/david-runciman/a-pound-here-a-pound-there
Great piece as always. In Australia, after non stop betting ads during footy games, I chuckle when they add the “gamble responsible” line at the end. Full of crap.
It’s worse over in Oz because local sports clubs’ survival is almost entirely pinned to the revenue their pokie machines make.
There should be government intervention - this is exactly the sort of issue that requires it (spare me the socialism fear mongering that shows it’s ugly head here in the US for any sensible government intervention proposals)
Haralabob would be an amazing guest for the podcast if he'd do it.
Could it be that the sports gambling is just the NBA’s (and leagues at large) way to keep the viewers trapped in the attention economy casino, you know as a bulwark against their diving ratings?
There’s a point to be made (repurposing a Ben Thompson point here) that with centrally propagated mass media monoculture coming to an end with the fragmented distribution models of the internet, a content product stands to benefit from monetizing on “intensity” as opposed to gross ratings counts (say, some metric of time spent and engagement). Calculus-literate readers would recognize this as optimizing for area under the curve as opposed to optimizing for peak of the curve.
Oh man, I was wondering when you'd be getting to sports betting. I've taken an interest in it to the point where I even wrote a sports betting centric-novel ( The Sure Bet King , if you're interested), and this did not disappoint. Couple of things I want to say.
-I always knew that the house edge in sports betting had to exist even when I knew a lot less about it than I do now, and it looked like every piece of sports betting media WAS goading players into a stacked game. It turns out I was right-because a lot of personalities have affiliate deals where they can get people to sign up in exchange for a portion of their losses.
-For banning winners, I'm not really sympathetic towards most of the people who are banned/ultra-limited either. Most of the "advantage players" I've heard of are not handicappers but simply people who pounce on off/slow/etc... lines, or take advantage of bonuses/artificially good lines for the sake of promotion. They're also outright market manipulators who bet at the few sharp sportsbooks everyone else follows (Circa Sports and Pinnacle are the two most famous examples) to move the line and then wallop the slowest ones with their puppet accounts. At the very least, I can understand the book's perspective-they offer them nothing (while the handicapping originators can at least give them information on what a good line is) and are asking to essentially plunder as much as they can. It's an unsympathetic business all around.
-That being said, it is goading people into embracing a game stacked against them. Even the few sharp books that do allow winners come across as this, as it's even harder to win there (because of better lines you can't win via "coupon clipping", as one gambling tweeter calls it, in books where there are no coupons to clip)
-The ROI for the few winners is just not very good (effectively low single digits at best). The cost-benefit does not work out. You are putting in gargantuan effort (be it modeling or line munchkining while dodging the enforcers) to get something you could have for far less work and stress just by buying and holding blue-chip assets.
-The message is basically "use your knowledge of sports trivia and your gut to win big on your mega-parlay." This of course is false.
-For you in particular Ethan, you might like this claim of mine. I think the next big sports betting scandal won't be a Black Sox (players) or Tim Donaghy (refs) doing shady things, but a front office person betting using inside information (the Draymond Green prop mess has made me even more convinced of this).
-That being said, I do support legalized sports betting, just as how I support legalized gambling in general. There are responsible gamblers who don't really expect to win and don't overspend. But I have no illusions.
I think recreational bettors should welcome rather than resent the efforts of sports books to keep out the likes of Haralabos. Some econ 101: sports betting is an increasingly competitive marketplace. That means all the sites are going to be forced to give the bettors at least a roughly similar deal. If they save a bunch of money by keeping out successful professional bettors, much (most? all?) of that savings will go to the other bettors in the form of better bonuses, more generous boosted odds, other promotions, etc. (It's no different than saving money by switching to AWS or something. That's good for the customer, and so is this.)
This dynamic is very obvious in the context of daily fantasy, where most recreational bettors realized they were getting destroyed by professionals using sophisticated models and putting in enormous numbers of entries--not very fun to compete with that! It doesn't feel the same with sports betting, because you're nominally playing against the house rather than against other competitors, but the underlying economic reality is the same; allowing in professionals makes recreational bettors lose more, more quickly.
It's interesting to me that a discerning commentator like Ethan, like most others, has accepted the idea that keeping out the likes of Haralabos is some kind of attack on bettors more generally. I feel there has been a successful PR operation from the pro gamblers on this issue. They frame it the way Ethan did: sports books keeping us out means they'll never let you really win! But as Ethan should realize, recreational bettors like myself are never going to "really win" (in the sense of finding a consistent edge and using it to make a stable return) anyway. We won't make sports betting our full time job, we won't create sophisticated models, we won't hire research associates, etc. For us, cutting our losses by keeping out the sharps is a favor.
I'm a little surprised we haven't gotten a "Is sports gambling racist?" think piece somewhere yet, given the social dynamics of (mostly white) fans and (mostly Black) athletes.
Educated people won’t even talk about the obvious link between weed de-crim and the homelessness epidemic. Fat chance getting them to be honest about legalized sports betting.
I have zero problem with casinos turning away people who would not be profitable to them. If these sharps want to make money with their expertise they can set up their own books and take best from the public. They don't want to do the work, so fuck em.
However, Ethan is right about you never hear about the addiction aspect and how to prevent the societal downsides as much as possible while letting the free market work. Right now, it is privatized gains, public loses. Society has to deal with the costs of addiction like bankruptcy, crime, broken households, etc.
Legalization doesn't have to mean a free for all.
This has been the issue with any vice in history. For example, by my old apartment in Denver. There would be alcoholics just waiting outside the local liquor store to open up so they can go in and buy those cheap shooters behind the counter that no one else buys except alcoholics. The liquor store makes a crazy profit off these people but the city is left to deal with the fall out that is millions of dollars in city services.
People are starting to realize this when Colorado legalized pot. That maybe having little regulation but letting for profit companies be the distributors is bad. 99% of pot smokers are totally fine and follow the rules, but there is no central tracking database between pot shops to see if people are buying over the limits. So buyers could go from pot shop to pot shop buying the max and then take it and sell it over state lines or to kids or whatever.
Adding a gambling helpline isn't going to do shit, nor do I think a quick chat with a government worker is going to do it. The states need to create rules where if a person wants to bet, they need to submit a tax return and a paystub and they are approved for a specific limit that is shared between ALL gambling locations. If the bettor has a partner, the partner should have the ability to get access to statements and notified of any major changes in betting patterns.
This sounds like a hassle and that's because it is. People who want to bet for enjoyment will still be able to but it will minimizes the public's risk & cost. Sure some gamblers will turn to the black market but that was the way before legalization, at least this way, society can set the terms somewhat.
Man, anyone that's logged into any of these online sports books or seen the TV ads knows it's all targeted to loot you blind. MGMBet has a parlay generator to just YOLO your money out there and most of the ads promote the ability to have a near infinite amount of preposterous bets going simultaneously. It's a far cry from getting grandma to put down $10 or $20 on her beloved Bucks.
Good stuff Ethan. I've been learning a lot about sports gambling since it became legal in my state in 2020. This piece covers what's going on.
I've said this elsewhere, but: I wonder if the sports betting bubble will burst in a few years after casual bettors realize they are consistently losing their money. Sports wagering isn't as easy as it looks. Even sharps win only 55% of the time (on what they can get down, as you wrote). And all the "fun" bets that these sportsbooks like to promote -- parlays, boosts, "risk free" wagers -- are actually big time sucker shit.