Category
🥇
SportsTranscript
00:00Welcome back to Newswire.
00:05The state of Florida has now had sports betting for approximately a year, and that is going
00:11to continue, but it only will continue via the Hard Rock app.
00:15A monumental ruling yesterday for the Seminole Tribe for the state of Florida.
00:21Let's bring in Sam McQuillan for the latest on that.
00:24And Sam, this is not a huge surprise.
00:26I think we thought that this was not going to get overturned.
00:29This group, West Flagler, who was fighting to not even have legalized sports betting
00:33at all.
00:34They didn't want it.
00:35They ended up losing.
00:36And I guess the question I would have for you as we start here is, do you think that
00:40the Seminole Tribe will be willing to take on other vendors before 2051, which is when
00:46they have this exclusivity going?
00:48Yeah, Craig, that's a long time away.
00:52So a lot of things can change, obviously, in the next 30 years.
00:56But even before we get to that point, they've already suggested that, hey, maybe, never
01:01say never, we're willing.
01:03We're open to working with operators like DraftKings, FanDuel, even Penn that have in
01:09the past advocated and tried to expand sports betting in the state via the ballot.
01:15They've tried there.
01:16Obviously, the only successful way that sports betting was legalized and passed in Florida
01:22was through that compact with the Seminole Tribe that runs Hard Rock Bets.
01:28So that's the only thing Floridians have for now.
01:30But as you allude to, this ruling could open them up for future, maybe, partners, maybe
01:35sharing the state in some way.
01:37But they'd obviously want to get a lot of money out of that agreement, however, it would
01:41work.
01:42Yeah.
01:43And I think, Sam, when you look at it, the other part of this is that, do you think that
01:47the success that the state of Florida has, or at least the Seminole Tribe has, will relate
01:53to what could potentially happen in California, or is it an apples and oranges conversation?
01:59Yeah.
02:00It's always a little bit of apples to oranges, even when you're just talking state to state,
02:04and then you talk tribe to tribe.
02:06But California and Florida specifically, California has so many more tribes than Florida.
02:11What happened here is there was sort of a group of tribes that was kind of left out
02:15of the agreement originally, was upset about that, and then tried to challenge it.
02:19So the impact of this ruling, I would say, would be bigger than the actual success model
02:25that the people who are running the app have on California.
02:30The impact of this ruling essentially is saying that, hey, tribes, you guys should go in with
02:35more assurance, more power, knowing that the Supreme Court isn't going to take up a case
02:40like this.
02:41What they were challenging is saying, okay, just because you have servers on tribal land
02:46that accept bets from anywhere in the state, that doesn't mean that you're actually taking
02:50those bets on tribal land.
02:51It's kind of how they got around or worked around this gaming compact, which only allows
02:56you to take bets on tribal land.
02:58So if I'm a tribe in California, I'm definitely looking at the decision yesterday not to take
03:03up the case as a sign that maybe these things are legit, maybe this is a real path forward
03:08for us in the state.
03:09Now, this is kind of like a tentacle.
03:11It has rippling effects throughout the industry.
03:14If you're an operator like FanDuel or DraftKings, you're looking at HardRock and what they did
03:18partnering with the Seminoles saying, wow, this worked for them, they're making a lot
03:22of money out of it, we know we're the best at doing this, we're going to try to sell
03:26ourselves as that operator that really knows what they're doing to these tribes.
03:31So you saw gaming stocks soar about 6% most of them yesterday on Wall Street, which is
03:36really interesting because they've been down for a while lately, so it seems like the impact
03:40of this ruling has Wall Street thinking that DraftKings, FanDuel, maybe even Appen could
03:45go into a state like California, maybe a state like Minnesota, where it's not as high stakes,
03:49and partner with these tribes the way that HardRock has done with the Seminoles.
03:53And it's kosher, there's nothing to worry about.
03:55So there's a lot of moving parts here, but it kind of signals that maybe this is where
03:59things are going.
04:00Maybe Florida can now do iGaming eventually in the future, since they kind of have this
04:03blessing from the Supreme Court that says, we're not going to mess with this.
04:06So obviously, everything can change, especially in the next 30 years, but it's a good sign
04:11for Florida and then good sign for the gaming companies that want to take advantage of this
04:15route.
04:16Yeah.
04:17And speaking of Penn, I'm glad you mentioned them.
04:19There's a lot of discussion about them as well, they threw the ESPN logo on them, took
04:25it over from Barstool basically, and created ESPN Bet, just simply thinking, hey, look,
04:30we got this brand, we're going to succeed.
04:33I know you and I were both sort of skeptical of this, but the skepticism has even taken
04:37a deeper turn here.
04:39And I wonder what the future is going to hold here for ESPN Bet.
04:42Yeah, definitely, Craig, I would count you and I as among the biggest skeptics.
04:47And even our predictions, our skepticism has kind of been beaten by these bad results.
04:53ESPN Bet has only held around 6% of the market, and that's being generous in the past several
04:59months.
05:00So it's not taking off the way the company had kind of hoped for it, the way that CEO
05:05Penn Snowden, or the CEO of Penn, Jay Snowden, had said when they were making that huge bet
05:10on ESPN.
05:11Meanwhile, ESPN is really soaring in terms of their subscribers and numbers they have.
05:17I think they had about two thirds of Americans, they said, were subscribed or following ESPN
05:24in some way.
05:25Meanwhile, ESPN Bet only has about 685,000 monthly active users.
05:30So there's still a lot of room to grow there.
05:33How are you doing that?
05:35When is that going to happen?
05:36What does that look like?
05:37They've talked about NFL season as being their big, big key for when they're going to ramp
05:42up things, when they're really going to see the return on investment, whether that's diving
05:46into ESPN's fantasy assets, or just, you know, trying more promos, they have a lot kind of
05:50left on the table.
05:52They're trying to assure investors about.
05:54Investors, meanwhile, are calling for the company to sell because of these interactive
05:58losses where it's just been a lot of money being thrown at the wall, and not many results.
06:02Some speculated Boyd could be interested in getting into this, the Penn business, since
06:08they just appointed someone to their board with 25 years of experience, who has a lot
06:13of time working with gaming companies and acquiring gaming companies.
06:18They've said they want to acquire another company for the right price.
06:21So we'll see if the price point gets better with the lackluster ESPN bet results.
06:26We'll see how the ESPN bet agreement ties into that whole thing.
06:31But it could be another messy year in terms of companies changing hands.
06:35Obviously, last year, we had Barstool going away in favor of ESPN bet.
06:40We had PointsBet being bought by Fanatics.
06:42Last summer was a crazy summer.
06:44This summer could be just as crazy if Penn and ESPN sell to a company like Boyd.
06:49Yeah, no, it could be.
06:51And again, that would be a big disappointment, but it could be the right move.
06:54We'll see.
06:55All right, so this new Sports Integrity Partnership, Genius Sports, is involved in this more protection
07:01suspicious betting activity.
07:03I like to learn more about these stories because it means that there's more regulation and
07:07more people paying attention to sports betting, Sam.
07:09So tell us more about this.
07:11Yeah, definitely.
07:12Genius Sports is essentially the company that partners with leagues worldwide, whether that's
07:19the NFL, the Premier League, to provide betting technology monitoring services between the
07:24bets being taken on the league and the sports books themselves.
07:27So they're kind of an intermediary.
07:28And they announced yesterday that they're going to be partnering with the International
07:33Betting Integrity Association, essentially becoming a member.
07:36And they said that's going to allow them to beef up their protection and add more integrity
07:40monitoring tools to essentially catch bad behavior before it happens.
07:45This comes, obviously, after a ton of scandals we've had across sports betting lately, whether
07:51it's the MLB umpire Pat Hobart being disciplined for violating the league's betting policy,
07:57whether it's a lifetime ban that was handed down to the Padres infielder a few weeks before
08:02that and several other Major League Baseball players that were suspended, whether it's
08:07Shontay Porter in the NBA, whether it's Shohei Ohtani.
08:10I could go on and on with all the violations we've had lately.
08:14So it's nice to see a company getting, you know, getting into the forefront, trying to
08:18add more protection services.
08:20It's not exactly clear what they'll be doing, but they said that it's going to allow them
08:23to work together to essentially figure out a solution to solve all this madness that
08:28has plagued the industry over the past month.
08:30So we'll have to see what more they announce in the partnership, but hopefully good things
08:36to come in terms of integrity monitoring services.
08:39Yeah.
08:40Yeah.
08:41So integrity monitoring is obviously key.
08:42As long as they're professional athletes that are not following the rules, these are the
08:46safeguards that have to be in place for that.
08:47Thanks again, Sam, for coming on Newswire.
08:49Have a great rest of your week.
08:51Yeah.
08:52Thanks, Craig.
08:53You too.