Geoff Freeman, the American Gaming Association’s new president and CEO, admits that sports betting is not high on his list of priorities. But he believes a cultural shift in America’s views on sports betting and gambling overall is occurring, which could lead to expanded legalization in the future.
Freeman became only the second president and CEO of AGA in July, replacing Frank J. Fahrenkopf, who had led the AGA since its founding in the mid-1990s. Freeman visited with BettingTalk to discuss the AGA’s priorities and the future of sports betting in the US.
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What advice would you give sports bettors who are interested in helping the push for expanded legalization in the US?
In general, my comments probably won’t be very reassuring or uplifting for them. While the industry is watching closely what’s happening in New Jersey (sports betting case), there are many other higher priorities on our agenda right now. The issue of sports betting and expanding legalization to other states is not one that has been put front and center on my radar screen by the industry. There’s absolutely an issue. I think we’ve all seen the numbers of upwards of 90 percent of sports betting is done illegally. It’s not in anyone’s interest to have illegal gaming going on, but there are a lot of forces at play here. And this isn’t an issue right now that we’ve chosen to make a high priority.
What are the AGA’s priorities right now?
The issue of online gaming is a very high priority. The other issue that I expect to be a very high priority is more of a focus, and that is to determine how we can better define the value of our industry. What we’re confronting with the expansion of our industry is there is still a good deal of misinformation about what this industry does and the value it provides. When you read the article in the state of New York and read the articles in Massachusetts, places where gaming is coming, there’s still a lot of misinformation about what this industry is and the value it provides and addressing that is a top priority of the AGA.
A negative perception of gambling still exists in the US. Some people think there is nothing good that can come from gambling as an entertainment option. What can be done to change that perception?
You’re right that that perception exists. And it’s incumbent on us and those who participate in this industry, your readers and others, to make a better case of what this industry is and the value that we provide. We’ve got a lot of work to do on that front. We’ve got our work cut out for us. With that said, as you look at what our industry is doing, particularly on the casino side, the multi-faceted entertainment centers that we offer, where a large majority of our revenue is coming from non-gaming activities. I think there’s a cultural shift and a generational shift taking place, where the people who see that begin to see the industry for what it is. However, there’s still a generation or more that continue to have the previously illegal aspects of this industry front and center in their minds. That’s something that we need to tackle.
The National Gambling Impact Study Commission estimates that $380 billion is wagered illegally on sports annually in the U.S. That seems like a very difficult estimate to be accurate with. From your knowledge, what statistics were used to come up with that estimate?
Your guess is as good as ours. We’ve been looking into that. The commission did a lot of interviews that are not documented when they were making that estimate. We’re not sure where that exact number comes from. I would agree with your point that this is a very difficult thing to estimate. What we all know is that hundreds of millions of dollars is being spent on what is considered illegal sports betting. I would suggest that is not good for any of us in this industry for people to be enjoying our product in an illegal manner. That’s why in the long run, each of these issues need to be addressed.
As I said at the outset, though, we have a long list of issues that need to be addressed. There’s a lot of illegal gaming going on in this country, from the internet sweepstakes cafes to the offshore operators who are still offering online gaming here in the United States in an illegal fashion. We have to address each one of these in times.
Q: What are the issues that you are most wary about as legal online gaming expands in the US?
On one hand, online gaming here in the US is an unknown. We haven’t yet seen how this interacts with a brick-and-mortar operation that we all want to see thrive. I think all eyes are really on New Jersey at this point. People are eager to see what the effect will be. We’re all watching with great anticipation and great excitement of what could be, but it’s something we’re going to have to track closely. On the other hand, online gaming is alive and well in Europe. To the best of my knowledge, we’re not seeing sudden increases in gambling addiction or other issues. I think a lot of the ‘sky-is-falling’ concerns are overblown. Now, all the great optimism may be overplayed too. We’ve got to watch and see how this plays out. We want to make sure consumers are protected. We want to make sure illegal operators are kept out of the country.
What is the AGA’s role in attempting to prevent offshore operators from offering services in the US?
That’s a very important question. Gaming here in the United States is obviously a privileged business. All of our members go through a rigorous licensing process. They are held to the highest regulatory standards to make sure they are protecting consumers and are operating in the most reputable manner. The AGA will aggressively seek to prevent entities, whether online or offline, who don’t want to play by the rules that are set up for gaming in the United States. I think there are various ways we can go about doing that. Individual states have said that we’re willing to have gaming, but we’re only willing to do it in a very regulated manner. And anyone who doesn’t want to play by those rules will be a target of the AGA and the industry in general. And they should be.
There is a lot of frustration from the sports betting side of things about regulation. It’s hard to figure out why the NFL and other major sports leagues are against regulation and are OK with keeping the vast majority of it underground. How can we change that perception and show them that regulation of sports betting and gaming overall is a positive step?
I’ll be the first to admit that I don’t understand the point of view of the major sports leagues. I wake up Saturday morning, and I turn on an English Premier League game. Not only am I going to be watching some good football, I’m going to be watching teams running around with Bwin and other gaming names on the front of their jerseys. It’s happening already, and these (European) leagues have found a way to make it work. I think in our society, we have seen time and time again, that regulating something is the best way of eliminating a black market and making sure things are done in a reputable manner. I really don’t understand the point of view of the leagues. I look forward to learning more about it. I have to imagine it’s much more complex than I can understand. There must be something I’m missing, because common sense certainly suggests that regulating this is the best approach.
Do you believe sports betting will eventually be legalized in the US, and if so, in what time frame?
I’m not going to wager a timeframe on it, but the country continues to progress. Things we consider unsuitable today may become more than suitable in time. I read a story the other day about the massive shift that has taken place with people’s comfort level with marijuana. There’s a massive social shift taking place, and I wouldn’t expect sports betting to be left out of that.