Will Online Gambling Really ‘Follow Right Behind’ Legal Sports Betting?

That same case — Christie vs. NCAA — could open up a groundswell for online gambling, as well, if you believe one New Jersey regulator.

Sports wagering leads to online gambling?

Oral arguments in the New Jersey sports betting case take place on Monday.

New Jersey — which already has online casinos and poker — also wants to offer sports betting. The state is challenging the federal prohibition on sports wagering. (The Professional and Amateur Sports Protection Act only allows single-game wagering in Nevada.)

Should New Jersey win its case, it will likely be able to start taking sports wagers in 2018. David Rebuck, director of the NJ Division of Gaming Enforcement, will be at the center of that rollout, if it happens.

Rebuck believes that the case could have ramifications far beyond sports betting — and NJ — however. Here’s what he had to say, according to the Associated Press:

“If we win sports wagering, online gaming will go to every state that adopts sports betting,” said Rebuck who predicts a favorable sports betting ruling could help internet gambling “explode” across the nation. “As soon as sports wagering is legalized, online gambling will follow right behind it.”

Clearly, other states want sports betting

In the event of a New Jersey victory, this much is clear: A lot of other states are going to follow them into the realm of legal sports betting.

Whether it will immediately head online is a matter of speculation. But we do know what some states have planned on the sports wagering front:

• Pennsylvania — in addition to legalizing online casinos and poker in October — also had a provision that would allow it to offer sports betting. The interesting caveat: Sports wagering would take place both online and in brick-and-mortar facilities.
• New York has also legalized sports betting at its commercial casinos if PASPA is struck down. Wagering would not take place online under the current law. The state has also considered online poker in recent years.
• A number of other states will likely follow with regulations and laws of their own. Connecticut and Mississippi have already gotten started on this path, with states like West Virginia likely to follow. Whether any of these states would take sports betting online is unknown.

New Jersey’s law is simply a repeal of its own sports wagering prohibition, but it’s also almost certain to have online and mobile sports betting alongside its iGaming and iPoker products quickly, should it win.

The chicken and the egg with sports betting and online gambling

While sports betting will get a quick rollout in a lot of states with a New Jersey win, how those states will approach the sector is not at all clear.

Rebuck paints a rosy picture for iGaming. But in reality, taking sports betting, casinos and poker online in states will likely face challenges in every states. The same stakeholders that have been slow to adopt iGaming — or push back against it — could push back against online sports betting.

That’s despite the fact that online gambling has had a proven additive effect to revenue in New Jersey. And Nevada sports betting has grown leaps and bounds since sportsbooks in the state started taking mobile wagers.

While it certainly makes sense to take gaming online for a variety of reasons, states have been slow adopters. Only PA, NJ, Nevada and Delaware have iGaming so far.

Why not online?

It’s a no-brainer for states with existing gaming to roll out sports betting in their land-based facilities. But online may not happen instantly.

I broke down some of the reasons why sports betting could happen slowly — or quickly — over at Legal Sports Report earlier this year. The concerns include:

• Casinos don’t have a consistent message and aren’t on all on the same page on online gambling. And that’s not to mention other gaming interests in states.
• There is still a steep learning curve for lawmakers on online gambling. That was evidenced even in a forward-thinking state like PA, which is taxing online slot machines at a ridiculously high rate.
• Legalizing sports betting AND online gambling at the same time is a massive gaming expansion states might not have the stomach for (despite the fact that we saw it happen in PA).
• Lawmakers at the highest levels of government are still spewing nonsense about online gambling.

Still, Pennsylvania taking casinos, poker — and potentially sports betting — online should be a wake-up call for gaming states that don’t want to be left behind.

If you do sports betting online, you might as well do the rest

Rebuck is right from this standpoint: If you’re authorizing online sports betting, there’s little reason not to add online casino and poker.

We already know that cannibalization of land-based gaming by online is a myth, from the examples of New Jersey and Nevada (and the rest of the world, too). If you’re going to allow your state’s gaming interests to have online sports betting, you should let them have full online casinos right next to that.

Taking only one form of gaming online makes little sense. States in this scenario should be giving their casinos and tracks a full suite of gaming options to choose from online. This is the model from regulated markets in Europe (and for offshore online casinos and sportsbooks, for that matter). Users can bet on everything in a single online portal.

Will that logical argument actually help sports betting pull along online gambling? It would be nice if politics and government worked that way. In reality, it’s not a sure thing that states instantly adopt online gambling when they give sports betting the green light.