After the United States Supreme Court lifted the federal ban on sports betting in May, professional sports leagues in the country have been working hard to put protective measures in place. Most of the leagues initially distanced and, in some cases, even opposed it but on realizing the inevitability of its regulation, they had a change of heart. This all began through lobbying for the so-called controversial “integrity fee” that has not sat well with many of the state’s where sports betting is to be launched.
Since the attempts to have their “integrity fee” have turned out to be fruitless, the leagues have since adopted separate approaches, all meant to ensure that they are able to protect their own interests – for instance, the NBA and MLB are still fighting for the integrity fee but the NFL has opted to issue its own set of guidelines.
The NFL’s guidelines included provisions to protect its intellectual property – this will require the sports betting operators to pay licensing fees in order to be allowed access to valuable league data. According to a Nielsen Sports report that was commissioned by the American Gaming Association, if the NFL’s gets its way, it is projected to make up to $2.3 million annually from sports betting activities.
It’s All Fan-Driven
Nielsen Sports’ projections of the NFL’s annual revenue are based on a survey of football and sports betting fans. It is also worth noting that some assumptions were made. For instance, the survey assumed that regulated sports betting across the United States will boost media rights fees due to increased interest in the league’s games, sponsorships by sports betting operator and the purchasing of official league data. Also, the report factored out the integrity fee perhaps because of the uncertainty of its future.
“Legal, regulated sports betting will create huge new revenue opportunities for sports leagues – and the NFL could be the biggest winner of all,” said Sara Slane, the senior vice president of public affairs for the American Gaming Association. “Once legal sports betting expands across the country, the NFL could take in more than $2 billion a year, reinforcing how much sports leagues stand to gain from increased viewership and private partnerships with sports betting operators.”
The Nielsen Sports report states that greater fan engagement and viewership will significantly boost the NFL’s total annual revenue by 13.4 percent which will amount to $1.75 billion in new revenue from increased consumption of the NFL’s products.
Legalized sports betting in various states across the country will help the NFL to generate an additional $573 million in revenue – this will be from the sale of league data to data providers and sports betting operators. In addition to this, the projections also stated that the sports betting operators may spend close to $450 million on advertising and this will directly boost the league’s rights fees by the same amount. Finally, an additional $92 million in sponsorship revenue and $30 million data is projected for the both the NFL and its teams.