Cool the ‘gamblification’ of U.S. sports

The 2024 Super Bowl set records in sports betting, with an estimated 68 million adults betting on the game. In the two weeks before it, nearly 1.8 million people signed up for online betting accounts — which are now legal in 30 of the 38 states, plus D.C., that allow sports betting.

The lightly regulated legal sports betting business needs more, and smarter, government supervision.

It’s one of the nation’s faster-growing industries. In 2023, it generated $10.92 billion in revenue, a 44.5% increase over 2022, according to the American Gaming Association.

With sports betting now taking place in the open, states can tax it; in the third quarter of 2023, sports betting yielded $505.96 million in revenue, according to the Census Bureau.

The downside is that spectator sports have been quickly and pervasively “gamblified,” as scholars of the phenomenon put it. Access to an addictive experience has been expanded, and legitimized, in a nation already experiencing multiple crises related to addictive behavior.

Like nicotine or cocaine, sports betting offers a transitory high and leaves the brain craving more. Research indicates that nearly 6 million Americans struggle with a gambling disorder.

Thanks to smartphones, gamblers can easily use sports betting apps that often keep them hooked. With detailed real-time data of user habits, the apps can nudge users to keep going when they are most likely to do so. DraftKings and PointsBet employ VIP hosts who develop personal relationships with bettors and give out thousands of dollars of credits to help customers get going again after a losing streak. As the Wall Street Journal recently reported, VIP customers at PointsBet were 0.5% of the overall user base but the source of 70% of company revenue during a recent two-year interval.

Such practices cry out for greater scrutiny at the national level. The United Kingdom prohibits the use of credit cards in both online and offline gambling and has significantly curbed VIP programs. Those are good ideas, from which the United States could learn, paying special attention to online betting sites.

However, the job of supervising gambling currently belongs to the states, which have mixed incentives, given how much they depend on tax revenue and given the competition among them for gambling industry investments. Pro leagues have gone all in on betting boosterism, establishing lucrative sponsorships and partnerships with sportsbooks.

The public’s apparent attitude — pragmatic acceptance of sports betting, with misgivings — bolsters the case for tougher regulation.