About that 'Integrity Fee'

Who gets the vig?

Jeremy White
May 16, 2018 - 2:39 pm

Photo: Trevor Ruszkowski - USA TODAY Sports

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About that “Integrity Fee” 

It’s a funny thing to see all the professional sports leagues jump in line to work with both federal and state governments when it comes to legalized gambling in the U.S. In the span of a few short years we’ve gone from gambling being the third rail, and something that represented sports equivalent of the death penalty with Pete Rose, to a new revenue stream and something soon to be a huge part of the American experience.

I spoke with Brett Smiley, Editor-in-Chief of Sportshandle.com about the quick change we’re seeing from the major sports leagues.

As soon as the Supreme Court decision came down, legalizing sports gambling as many had expected, the leagues sprung into action. Brett says it was quite calculated.

“This is here, we respect this decision," Smiley said on WGR. "Basically they want a cut of the action is what it boils down to. They’re pushing for this. They don’t know what to call it. They want to charge a royalty on all sports book operators. 1-percent off the top may sound small but is actually about 20-25% of what a sports book typically keeps. A lot of states, New York included, have not been too warm to that.”

But why would the states, or the federal government agree to that? Here we see that these pro sports leagues are simply reaching out to get a piece of that money that’s bet on their games. As soon as gambling is legalized and the “vig” is rolling in to both the sports books and the government, should there be any reason to give any of it back to the respective leagues?

Does the league have a point here? That they’re owed some money for producing a product that is gambled upon?

“No legal grounds whatsoever," Smiley said. "This is case law that’s been decided. Information, scores, and whatnot are public domain information. There’s no proprietary right in that. So it’s basically a request at this point.”

Which means municipalities will have to face a simple question…

“Why should we take what would be taxpayer money for what we could use for roads and schools be giving it to the leagues?”

Great question. Can anyone out there think of why the billionaire owners, and the league that generates billions of dollars without gambling, needs to get any of this money? Seems to me what we have here is the sports world ready to not #sticktosports and instead go to Congress to try to get favorable laws written.

Should we expect that members of Congress will take contributions in exchange for a “federal framework” that favors the massively powerful league at the expense of…well…everyone?

These leagues get millions of dollars in taxpayer money. There are stadiums financed, and tax breaks, and on and on, and here municipalities have an opportunity to generate some more income through the existence of these teams and leagues... and the leagues are going to reach their respective hands out.

“Now that each state has the ability to license who they want to license and come up with to a tax rate that is agreeable to all sides… some states are putting in a teacher’s pension fund. Some states just a general fund that would go to infrastructure,” Smiley said.

Here’s hoping that these leagues get the old “talk to the hand” from government here. You’ll excuse me if I lack a little faith in that regard.

***

Match-Fixing

Brett goes on to point out that the sports that do occasionally struggle with match-fixing are lower-level events. Tennis and golf can occasionally run into trouble, and while there have been some cases at the top levels, it’s highly unlikely.

Flatly put, team sports with monstrous salaries and never-ending coverage don’t present a great opportunity to attempt to fix a game. The money you’d need to do it, and the likelihood you’d succeed are quite low.

If the league wants gambling money, go into business. How likely is that?

“I don’t think any league is going to want to get that close to it. What they’re going to try and do is sell the data," Smiley said. "The integrity fee has got the headlines, but they’re going to basically have the states put into their laws that the sports books that are licensed have to take their data from the leagues, so that’s one way they’re going to try to monetize this.”

The league has tried to do this with fantasy football and daily fantasy as well. It was only an investment into some of those companies that changed that, and Smiley reports that the league is currently trying to get out of those investments.

So no true threat to the integrity of the game... and no reason to think these leagues are dying for this money while there is a mountain of evidence that the public sector is... so yeah.

This "Integrity Fee" can buzz right off.

***

Your betting experience

I’ve been to two EPL games, both at The Emirates to support Arsenal. (Make your jokes here.)  

Betting in soccer is totally normal. “As normal as getting a beer” Smiley added. What’s it look like?  Kinda like quickdraw… so here’s a betting sheet courtesy of my friend and yours, Nick Mendola:
 

Fun, right?

 

[email protected]

@JeremyWGR

 

If you missed the interview this morning, listen to it below:

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