A U.S. Supreme Court ruling struck down a federal prohibition of sports betting on Monday and will allow all states to regulate the sports gambling industry.
The 6-3 decision in Murphy v. NCAA written by Justice Samuel Alito declared that the 1992 Professional and Amateur Sports Protection Act (PASPA) violated the 10th Amendment’s anticommandeering rule and was a “direct affront to state sovereignty.”
While acknowledging that the decision to permit sports gambling is a “controversial subject,” the Supreme Court deferred that decision to the states, writing:
“The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not. PASPA ‘regulate[s] state governments’ regulation’ of their citizens. …. The Constitution gives Congress no such power. The judgment of the Third Circuit is reversed.”
This decision will have immense implications for the entire sports industry, including the technology sector that will power most of the wagering—and be responsible for preserving the integrity of games.
Sportradar is an international leader in sports integrity monitoring, and its deputy president Laila Mintas recently advocated for a centralized bet-monitoring system. That oversight would be especially important for NCAA sports.
“The solution would allow regulators to have complete regulatory oversight of wagers from an integrity and compliance perspective and give regulators and leagues an overarching view across all wagers, operators and sports, to spot patterns and trends of interest you otherwise wouldn’t be able to,” Mintas told SportTechie.
NBA commissioner Adam Silver has positioned himself as a “realist” in the sports betting conversation, saying at last week’s Wall Street Journal Future of Everything Festival that he supports a similar push.
“The way I was thinking of it is like a public stock market,” Silver said. “If there’s transparency, if there’s irregular behavior, sophisticated computers flag it and say there’s aberrational betting on a particular game.”
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Silver said gambling would improve engagement and viewership numbers. He said more than 80 percent of gambling is in-play wagering done on mobile apps with bets placed on in-game events like whether a shooter will make the next two free throws. The ancillary benefit of this is that the user is identified through technology, replacing the cash transactions at a betting window.
“Where I’d like to see it go—and because it also does the best job of protecting our integrity—is where it’s gone in Europe and that’s on smartphones,” Silver said.
Silver has suggested the possibility of in-app wagers for fans watching on an OTT feed. That has the potential to make digital streaming rights an even more valuable commodity. Sportradar launched an OTT platform for sports federations last year. Providers were quick to react to Monday’s news.
“For betting operators and rightsholders, it presents a unique opportunity to build an efficient, properly regulated betting market from the ground up and design a model for what 21st century betting should be,” Perform Group‘s Content CEO Ross MacEacharn said in a statement. “We look forward to working closely with our rightsholder partners, legislators, regulators and clients to shape the reality of a safe, engaging sports betting environment.”