Abstract
It was understood that professional sports leagues, teams, and athletes would want a significant portion of the revenue generated when states began to legalize sports gambling. The leagues, teams, and athletes are stakeholders and legalized gambling on sports is impossible without their cooperation and partnership. This cooperation would come with a price, although there was no model or playbook to follow. This would be the first open partnership between professional sports and the gambling industry. This commentary examines how the National Football League, under the leadership of Commissioner Roger Goodell, engineered a scheme designed to enrich the league and its team owners while simultaneously creating a significant and still developing risk to public health.
The National Football League (NFL) business partnership with the gambling industry is an existential threat to public health which is metastasizing across professional and collegiate sports. It is imperative that Congress become actively involved to address this significant risk of harm.
DraftKings, an official gambling partner of the NFL, epitomizes this dangerous risk of harm. Currently, DraftKings is using the NFL to cross-promote a $2,000 “online casino sign-up bonus” designed to lure and hook new players. The “bonus” offered by DraftKings requires people to gamble and risk $40,000–$400,000 in the online casino within 30 days merely to potentially qualify.
Immediately upon the conclusion of Sunday Night Football on NBC, the network airs a commercial for its official gambling partner, PointsBet Sportsbook. The commercial features future NFL Hall of Famer Drew Brees challenging people to make more “in-game wagers” and Mr. Brees offers the false and dangerous promise of “risk-free bets.” To be clear, there are no risk-free wagers. Mr. Brees is knowingly misleading the public and any money gambled and lost is gone forever and squarely in the hands of the gambling industry.
We are left to wonder whether NFL Commissioner Roger Goodell, or any of the 32 team owners, contemplate the risk of harm inherent with an inducement to gamble as much as $400,000 in less than 30 days. Are Commissioner Goodell or any of the owners concerned that the NFL image is being used to entice people to gamble more with the entirely false promise of $2,000 risk-free wagers? More importantly, the question is whether Congress is aware these dangerous and predatory promotions are being pushed on the public by the NFL and its gambling industry partners.
How did we move from the NFL spending decades opposing gambling to the league and its gambling partners invading every home in America on televisions, phones, computers, tablets, and soon, voice-activated remote controls? The answer to this question reveals a dangerous and likely illegal business scheme engineered by the NFL. This scheme is driven by greed and avarice and is designed to wildly enrich the league and its 32 team owners. Unfortunately, this unquenchable thirst for wealth and power disregards the significant risk to public health. The time has come for Congress to act. Ethical reform and regulation are necessary to prevent significant harm to children, families, and the public.
For decades, the NFL eschewed any relationship with legalized gambling. In 1990, then Commissioner Paul Tagliabue testified before Congress and described the NFL's decades long opposition to legalized gambling: “We strictly prohibit NFL club owners, coaches, players and anyone else connected with the NFL from gambling on NFL games or associating in any way with persons involved in gambling. Anyone who does so faces severe disciplinary action by the Commissioner, including lifetime suspension.” 1
More specifically, the NFL was vehemently opposed to state government becoming a partner with the sports gambling industry: “States and the private gambling industry should not be permitted radically to alter the character of sports leagues' products and to expropriate those products for their own commercial purposes.” 2
The very next year, Commissioner Tagliabue again addressed sports gambling and the risk of harm to children. In an unequivocal statement, the commissioner affirmed, “we do not want our games used as bait to sell gambling … we should not gamble with our children's heroes.” 3
Testifying before the House Judiciary Committee, Commissioner Tagliabue pleaded with Congress to protect children and families from the harm that would occur if states were permitted to legalize sports betting: “legalized sports betting sends a terrible message to our youth. Sports are very important to millions of our young people. Youth look up to athletes. Our players cannot be expected to serve as healthy role models for youth if they are made to function as participants in gambling enterprises.” 4
In a prescient statement Commissioner Tagliabue predicted legalized sports betting would “promote gambling among young people” and result in an increase in gambling among teenagers by sending the message it is a normal form of entertainment. In 2009, current NFL Commissioner Goodell expanded upon these concerns and reaffirmed the NFL's opposition to legalized gambling when he wrote, “The negative social impact of additional gambling cannot be minimized in a community.” 5
By 2017, the NFL abandoned any pretense of concern for youth, family, community, or public health. On the surface the NFL maintained the illusion of opposition to legalized sports betting. Meanwhile, motivated by the potential for billions in gambling revenue, the NFL made the transformative and conscious choice to become a full business partner in the gambling establishment. When the Raiders moved from Oakland to Las Vegas, Commissioner Goodell effectively punted, “Society in general has a little bit of a change with respect to gambling in general. We've seen that. I think we still strongly oppose legalized sports gambling. The integrity of our game is No. 1. We will not compromise on that.” 6
On May 14, 2018, the United States Supreme Court issued its decision in Murphy v. NCAA 7 and held the Professional and Amateur Sports Protection Act (PASPA) unconstitutional as an infringement on states' rights under the Tenth Amendment to the Constitution. Contrary to widespread belief, the Court did not pronounce sports betting legal throughout the land. Similarly, the Court did not revoke the authority of Congress to regulate gambling on the federal level. Additional action by Congress would be required to regulate gambling from a public health perspective.
During this same time, medical science was working to better understand the risk of harm presented by gambling. In 2013 the American Psychiatric Association recognized gambling as an addictive product and classified gambling disorder as an addiction on the same level as heroin, opioids, alcohol, cocaine, and tobacco. 8 The World Health Organization (WHO) made a similar pronouncement, and, recently, the WHO estimated that 350,000,000 people each year demonstrate signs and symptoms of a problem with gambling or gambling disorder. 9
There is a high correlation between gambling problems and risk of suicide. Research confirms that risk of suicide is more prevalent with gambling than any other addictive disorder. One of every two people struggling with gambling disorder contemplate suicide, and one in five attempt suicide.
Immediately following the Supreme Court decision in Murphy, the NFL approached the players' union and offered to renegotiate the league collective bargaining agreement. This “gesture” was previously unthinkable in a league with a history of more than a half century of labor unrest. This was not a sign of goodwill. Rather, this was a prerequisite to the creation of the league's gambling strategy. To gain the cooperation of the players, the new collective bargaining agreement includes a still-undisclosed arrangement for the league to share gambling revenue with the union and players. This makes NFL players financial partners with the gambling industry with direct incentive to encourage people to gamble.
Next, the league rewrote its governing constitution and removed all prohibitions against relationships with the gambling industry. In the wake of this policy change came an open season and wild west environment for the NFL and its team owners to pursue newfound wealth by embracing the explosive growth of legalized gambling. While it was understood the NFL would explore gambling options, not even the most jaded skeptic could have predicted the extent to which Commissioner Goodell would embrace a new paradigm and develop a gambling strategy placing revenue, power, and wealth above public health.
Commissioner Goodell's gambling strategy is an elaborate vertical scheme with the NFL at the very top. The NFL utilizes its brand, games, statistics, and the players themselves as tools to extract enormous licensing payments from the gambling industry. This scheme, based on the gambling industry paying billions to the NFL, ensures that gambling companies must aggressively market and promote more harmful and addictive gambling products. The NFL is a full business partner delivering virtually non-stop gambling on NFL football, and this constant access to action is at the epicenter of why gambling is such an addictive product.
The NFL effectively auctioned its brand to the highest bidders and the results are staggering in size and scope. In total, the NFL reached agreements with seven gambling companies. The NFL named Caesars, DraftKings, and Fanduel as “Official Sportsbook Partners” and these five-year agreements are valued at more than $1 billion. 10 The league then reached agreement with FOX Bet, BetMGM, PointsBet, and WynnBET to become “Approved Sportsbook Operators” and has yet to disclose the value of these additional deals.
The agreements with the seven gambling companies are central to the NFL's strategy to maximize gambling revenue; but only the tip of the iceberg when it comes to the risk of public harm. Concurrent with these seven agreements, the NFL named Genius Sports LTD as the league's official data and statistics partner. This six-year deal pays the NFL $120 million annually and gives the league a significant equity ownership interest in Genius. 11 The NFL then invoked its financial power and monopolistic position to demand that the seven official gambling partners obtain all NFL statistics and data exclusively from Genius. This forces the seven gambling partners to pay Genius hundreds of millions each year to obtain access to the NFL statistics and data needed for gambling.
This is also the most dangerous aspect of the NFL gambling scheme. Genius disseminates statistics and data to the gambling companies in real time. This permits the seven gambling partners to promote the highly addictive “in-game wagering” and take bets on every play in each NFL game. This ensures increased gambling revenue, and losses by the public, with betting taking place every 40 seconds or faster.
The NFL and its gambling partners capitalize on the most addictive and dangerous aspect of gambling, the non-stop action. This drive for access to non-stop action is at the heart of the gambling industry business model. It is also the reason gambling has been recognized as an addictive product. As with any drug, substance, or addictive product, access to action is a direct cause of harm. The faster the access to action, the more that people will gamble. As a matter of mathematical certainty, the faster that people gamble, the greater the financial losses and public harm suffered.
The Goodell scheme does not end at the league level where revenue is historically shared equally by every team regardless of market size. To keep individual owners ever more satisfied, Commissioner Goodell issued an edict permitting each team to negotiate separate deals with any of the seven official gambling partners.
For example, in Philadelphia, Jeffrey Lurie, owner of the Eagles, has named DraftKings as the team's “official sports betting partner.” DraftKings immediately opened betting lounges inside Lincoln Financial Field and gambling QR codes are displayed on scoreboards throughout the stadium. The QR codes during games allow people to make instant bets on the next play without leaving their seats. Sports as family entertainment are vanishing. Live sporting events are now the equivalent of watching the roulette wheel spin and the dice fly.
Philadelphia is not unique. Similar deals have been struck in Arizona, Baltimore, Detroit, Indianapolis, Las Vegas, New York/New Jersey, New Orleans, Pittsburgh, and Tennessee, with many more still to come. Things are even more incestuous in Virginia. The Washington Football Team is being lured to move to Virginia and has been rewarded with a coveted gambling license. Thus, in Virginia the Washington Football Team is now a sportsbook owner taking bets on its own games. The bookie controls the game, what can possibly go wrong here?
The NFL acts in conscious disregard for public health and the scientific reality that gambling is an addictive product. The league extracts billions from the gambling industry by selling the league image, game statistics, and the right to use NFL football for gambling purposes. This is where the risk of public harm begins to explode as the gambling industry must recoup the billions it is spending. The gambling industry has no product to sell. The industry simply markets and promotes faster and more addictive gambling products to extract increased betting action from the public.
The equation is simple. The greater the frequency and intensity of betting by the public, the more people will lose. This is the economic certainty of gambling. Equally certain is the more the public is enticed to gamble, the greater the risk of harm to children, individuals, and families; the very harm the NFL spent 75 years professing to protect.
We need look no further than television and social media to see the public health risk of legalized gambling. The public, including America's youth, are being bombarded with a tsunami of gambling advertising. The seemingly endless supply of gambling advertising is replete with dangerous, false, and misleading promises of “risk-free bets,” and the predatory “sign-up bonuses.” The risk-free bets never return money lost. Instead, they fuel gambling accounts with credits to chase losses. Gambling companies use “risk-free bets” to keep people in action. Imagine a bar enabling a patron with extra drinks to keep the drinking action going. Society would never tolerate such dangerous conduct. With the NFL, it is part of the gambling strategy.
What has transpired in the last 12 months is nothing short of shocking in size, scope, and risk of public harm. The NFL has implemented Commissioner Goodell's gambling scheme without public or government scrutiny. The broadcast media has a huge financial incentive to champion the growth of legalized gambling without consideration of public harm.
Comcast, CBS/Viacom, Disney, and Fox are broadcast partners and have financial ownership in the gambling industry. CBS has recently named William Hill as its “official sports betting partner.” Fox controls FOX Bet sportsbook. NBC/Comcast has a significant equity interest in PointsBet and has named the company its “official sports betting partner.” Disney has equity positions in multiple gambling companies and aggressively markets gambling through its ESPN brand. Disney recently announced it is seeking more than $3 billion dollars to license its ESPN brand as a gambling company. 12 The broadcast networks also have huge financial interests in the advertising revenue related to the massive expansion of legalized gambling.
The NFL itself is attempting to distract the public and government regulators. The NFL recently announced a significant contribution to the National Council on Problem Gambling (NCPG). The NCPG promotes itself as an advocacy organization; however, it has a direct financial relationship with the gambling industry. We would expect independent advocates to block addictive gambling products such as “in-game wagering” and to oppose dangerous schemes like the NFL gambling strategy. Unfortunately, the NCPG is complicit with silence regarding these issues and recently accepted more than $250,000 directly from the gambling industry to fund its annual conference which promoted industry self-regulation commonly known as “responsible gaming.” 13
The NFL/NCPG collaboration is an investment in delivering treatment services to people suffering with gambling disorder. While treatment is vitally important, the model embraced by the NFL and NCPG is ethically flawed. It is an attempt by the NFL to purchase favorable media coverage. The NFL diverts attention away from the dangers of its gambling strategy and replaces it with accolades for funding treatment. This is the flawed moral equivalent of big tobacco saying permit us to aggressively market cigarettes and we will donate money for chemotherapy and hospice.
If the NFL, its gambling partners, and the NCPG want to ensure access to treatment they should join with independent advocates and fight to have gambling disorder recognized by Congress as an addiction on the same level as heroin, opioids, alcohol, cocaine, and tobacco. This would mandate that treatment services be covered under every health insurance policy and would serve to guarantee access to care for all who need or desire it.
At present, greed and avarice are on full display, and in total control. There can be no doubt this is resulting in unnecessary and irreparable harm to public health, and this will continue to intensify. This is an entirely unsustainable model, and the time has come to explore and examine the power and influence being exerted by the NFL and the gambling industry. Left unchecked this danger will grow exponentially. Technological advances will soon bring instant access to gambling in our living rooms with the television remote control. Each phone, tablet, and portable electronic device now delivers access to sports and casino gambling. This certainly begs the question of when enough might be enough.
Public health, social justice, and harm prevention mandate that the NFL's scheme be exposed and subject to discussion, reform, and much needed regulation. This is a matter of significant national importance, and it will require the work of independent advocates to bring these issues to the attention of Congress.