57
The global sports gambling sector is large and lucra-
tive – although, depending on one’s lens, either smaller
or larger than the popularity of sports might lead many
to expect. And the critical lenses are labelled “legal”
and “illegal”. Here, we suggest that if illicit sports
betting is included, the worldwide total sports betting
worldwide may be as much as half a trillion dollars,
making gambling by far the biggest financial interest in
the global sports sector.
A prominent gambling consultancy put the
legal
sports
betting market at $41 billion worldwide in 2009, mak-
ing it just over 12 per cent of a global gaming industry
worth some $335 billion.
i
Of this, $10.4 billion is online
sports betting. But legal betting revenues comprise
only a portion of the total sector, which leads to
considerable understatement of the overall magnitude
of sports betting, as industry experts believe illegal
gambling in some countries is many multiples of its
legal counterpart.
Expert “belief” is the operational term here, because no
authority has an accurate idea of the true dimensions
of the illegal betting market. The most widely cited
figures are from a 1999 U.S. report of the National
Gambling Impact Study Commission. The study ob-
served, “Estimates of the scope of illegal sports betting
in the United States range anywhere from $80 billion to
$380 billion annually, making sports betting the most
widespread and popular form of gambling in America.”
ii
In 2010 dollars, the Commission’s range would run
from $105 billion to $497 billion, provided the Nevada
sports book kept pace –which it has not, contract-
ing by some 15 per cent, due to the impact of online
betting and other illicit outlets.
iii
This one speculative
sentence is routinely transformed into, and authorita-
tively cited as, a 1:100 ratio of legal to illegal sports
betting in the United States. Needless to say, the lower
boundary might just as easily be cited – a considerably
less dramatic but still substantial 1:28 ratio –which
remains a sensational but nonetheless simply specula-
tive measure.
Twelve years after the Commission’s estimates,
however, the size of the illegal market remains just
as imponderable. Illegal betting volumes in Asia and
Europe, the world’s second and third most lucrative
sports gambling markets, are equally speculative,
although probably not as breathtaking as those of the
United States. Unlike in North America, in Asia and Eu-
rope sports betting is widely legal and viewed with less
moral approbation. Even so, we may presume from
anecdotal information alone – including reported betting
estimates of World Cup running into the tens of billions,
other important football matches on which billions are
wagered, and Super Bowl, or NCAA basketball betting
that each run into the billions – that the total global
sports betting market, legal and illegal, may range as
high as $500 billion. Taking advantage of the growth
of online sports gambling are online companies such
as Betfair and Bwin, which draw the majority of their
revenues – $334.5 million and $315 million, respective-
ly – from online betting. The sector has grown with the
rise of online betting and new forms of wager, including
“spot betting” and “live betting”, the latter of which
has become the most popular form of Internet wager:
in 2009 it accounted for 70 per cent of all sports bets
placed online.
Although the gambling industry has wrung its hands
over whether to bundle horseracing into the “sports
betting” category, and generally keeps it separate,
Monitor Quest believes racing to be an important
constituent of both the sports and the sports betting
ecosystems – as well as a signal concern in the sport
integrity universe. Moreover, the “Sport of Kings” has
the distinction of deriving almost all its revenues from
wagers. In 2009, its legal global take was an estimated
$16 billion, or five per cent of the worldwide gambling
industry.
iv
__________
i “Shuffle Up and Deal”,
The Economist: A Special Report on
Gambling
(10 July 2010).
ii National Gambling Impact Study Commission,
Final Report
(1999) pp. 2-14
Report/2.pdf (accessed 18 February 2011). Because the
Commission based its estimated range on Nevada’s 1998
sport book handle of $2.3 billion, this sentence is frequent-
ly transformed into, and authoritatively cited as, a 1:100
ratio of legal to illegal betting in the United States, with the
lower end of the range dropped out, thereby sensationalis-
ing a number that is simply informed speculation.
iii In2010, thedollar has inflated to1.309 its 1999value. At that
rate of inflation, $2.3 billion in 1999 would today amount to
$3 billion. But according to the American Gaming Associa-
tion Nevada sports books handled only $2.57 billion or a 15
per cent real decline since 1999.
iv “Shuffle Up and Deal”,
The Economist
, quoting H2 Gambling
Capital, a consultancy that monitors the global gambling
market.
Global Revenues from Sports Gambling
THE DYNAMIC ECOSYSTEMS OF MAJOR SPORTS
© MONITOR QUEST LTD. 2011
GUARDING THE GAME Preserving the Integrity of Sport
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