Industry Reports

MLB Executive Believes 0.25% “Integrity Fee” Would Be Fair Sports Betting Revenue Share to Get

The Major League Baseball (MLB) still insists on collecting a so-called “integrity fee” from US states which have made sports betting legal. As previously revealed by Casino Reports, the Executive Vice President of MLB, Kenneth Gersh, has shared his belief that it would be fair for the professional sports league to receive 0.25% royalty fee on every bet made in the states where sports betting has been legalized.

It seems that the barrier between sports and gambling in the US has collapsed. May 2018 saw the US Supreme Court finally announce its ruling in the New Jersey sports betting case, which ended up with the long-lasting sports betting ban being lifted. Since then, a number of US states have already legalized the new form of gambling and started offering sports betting as part of their gambling sectors.

Historically, professional sports kept a certain distance from possible connections with gambling until 2009, when the owners of the National Football League (NFL) decided to give the green light to licensing agreements with state-sponsored lotteries. Since then, similar agreements have been signed between lotteries and the MLB, National Basketball Association (NBA), and the National Hockey League (NGL).

With sports betting being brought to the legal gambling landscape in the US, an increasing number of professional sports leagues have become interested not only in signing more sponsorship agreements with gambling operators but also in getting a piece of the sports bets made in the country, saying that professional sports to bet on would not exist without them.

Professional Sports Leagues Could Get US$4.2 Billion by Sports Betting

MLB is not the only professional sports league which has claimed a portion of the newly-opened sports betting market of the US. The NBA has also claimed a chunk of the integrity fee, despite the fact that the Association has inked a sports gambling marketing deal which is already bringing it some money.

As previously revealed by Casino Reports, the MLB has initially required a 1% integrity fee of the overall amount of money being placed as bets on sports events. The state of New Jersey has already rejected that request, so the league has decided to reduce the required fee to 0.25%.

It is all about money. According to a recent survey commissioned by the American Gaming Association (AGA), legal sports betting services could contribute US$4.2 billion to the four major sports leagues in the US every year. These findings, as well as the great potential of the US sports betting market, has expectedly poured fuel on the fire, with professional sports leagues now being more eager than ever to get their “rightful” piece of the pie.

The research found that the largest chunk of the additional US$4.2-billion annual revenue that could be brought to professional sports leagues in the US is going to be received by the NFL and is likely to amount to more than US$2.3 billion. The rest of the money will be divided between the other three major leagues – the MLB, the NBA and the NHL.