U.K. Bookies Beware: the U.S. Will Look After Its Own In Betting Revolution

The U.S. Supreme Court recently ruled that states have the right to decide for themselves whether to allow sports betting. While American gambling companies have celebrated the declaration of gambling freedom, bookies in the United Kingdom have been salivating at the thought of getting on board a U.S. sports gambling market estimated to bring in hundreds of billions of dollars in revenue yearly. However, before U.K. bookmakers begin the move across the pond, they need to consider they may not be welcome, and they might even lose their shirts by opening up shop in the United States.

Who would benefit?

Clearly, U.K. bookmakers who stand to benefit most have already established themselves on the U.S. mainland in the few states that have already legalized sports gambling. For example, William Hill PLC has had a small bookmaking operation in Nevada since 2011. The company operates bookmaking on land in small bet shops, as well as online in the United Kingdom. Other countries that William Hill PLC has gambling sites in are Ireland, Australia, and Gibraltar, which is a British territory. William Hill’s stock rose by more than 10 percent on the news of the Supreme Court’s verdict. In addition to William Hill, another company, Paddy Power Betfair, has a small gambling operation in the United States. The company owns a television network that televises horse races, and a pari-mutuel betting network active in 35 states. Paddy Power Betfair also has shops and online betting in the U.K., Italy, and Ireland. The company also saw its shares rise on the idea it would be able to expand its gambling empire further west.

With all of the talk of U.K. companies expanding further into the United States, it will be difficult to hold down the excitement. Many U.S. companies that are gambling enterprises have lobbied for changes in the sports gambling laws and they will expect to be granted gambling rights when states vote to legalize sports betting.

The U.S. Gambling Players

The U.S. market has several large players already in the gambling business.

• The Las Vegas Sands Group has resort/casinos in both the United State and Asia. Headquartered in Las Vegas, it is the largest gambling organization in the world, with annual revenue of $14.5 billion per year.
• MGM Resorts International, with revenues of nearly $10 billion, also owns casinos throughout the United States and Asia. The company is also headquartered in Las Vegas.
• Caesar’s Entertainment and Wynn Resorts, both with revenues topping $4 billion, and both headquartered in Las Vegas, have multiple casinos in the U.S. and Asia.

Unlike the British companies looking to get a stake in the action, the American companies were founded in the United States, made their money in the U.S., and have developed a powerful lobby in the U.S., something many British companies without a long history in the United States don’t have. As in every country, companies with ties to their homeland have an easier time getting through regulation and legislation, rather than companies from overseas.

For British companies to be successful, they may have to sell part of their holdings in the United States or enter into a partnership with an American company that is already doing business there. In addition, British companies may want to team up with Canadian companies that are more familiar with the U.S. and American laws and regulations. Also, Canadian companies already have a sports-betting operation that many Americans near the border have used for sports betting, and so they have name recognition in many areas not covered by the U.K. gambling companies in Nevada.

Whatever the U.K. companies decide to do, most likely it will not be easy … or cheap. They must proceed with caution.

Relevant news