Sports betting could pose a serious problem for gambling addicts struggling with the limiting pandemic restrictions, especially with its recent legalization in Colorado.
During COVID-19, increased anxieties following the loneliness of isolation have driven some to dangerous coping mechanisms. A recent study conducted by the CDC in June reported that 13.3% of participants had started or increased substance abuse to cope with the adverse effects the pandemic has on mental health. Alcohol sales have increased, with at-home drinking becoming a trend as restaurants remain closed or sparsely attended. Additionally, there is concern the virus will cause the opioid crisis to resurge.
Among the many addiction and substance abuse-related coping mechanisms that have become rife amid the pandemic, a new threat has emerged for gambling addicts. Living in an extended lockdown, the novel ease of online betting and its proprietor’s ruthless advertising strategies have left addicts prone to relapse. This is especially prevalent in the realm of sports betting.
One of the largest issues for addicts is gambling’s modern accessibility. With casinos closed and many sporting events on hold, traditional gambling is impossible. However, the industry’s shift to focus on online formats has given anyone with a smartphone the tools to participate. The National Center on Problem Betting indicates that online betting has risen between 30%-40% since the pandemic hit the United States.
Online betting is not only more accessible to those confined to their homes, but it is more addictive than traditional betting. In a study by the UK’s Gambling Commission, 2.5% of those who gamble are likely to develop an addiction to online sports betting. This is compared to 1.2% in regular gambling.
Sports betting platforms are aware of their online appeal. In 2015, major sports betting corporations like FanDuel and DraftKings spent $74 million and $131 million respectively on advertising, outspending the entirety of the beer industry that year. The oversaturated advertising market in 2015 led to consumer backlash and sparked conversation on Twitter. The two aforementioned companies ran an ad every 90 seconds during the NFL’s opening three-week period.
After the 2015 uproar, daily fantasy companies received the message and lessened the aggressive nature of their advertising in 2016. However, affiliations with NFL teams and the recent FanDuel partnership with sports-media personality Pat McAfee seem to indicate that the companies will be a dominant presence in the upcoming NFL season. Sports betting corporations have already pumped millions into advertising for the 2020 season, and the result is clear. Daily fantasy advertisements are nearly impossible to avoid with cross-platform exposure expanded to television, podcasts and social media.
Regulation has been a controversial subject when it comes to daily fantasy. Many corporations have opted for a form of self-regulation, attempting to preemptively combat consumer dissatisfaction before it arises. On Sept. 14, the American Gambling Association put out a responsible marketing code for sports betting. The release included provisions that discouraged marketing targeted toward those legally prohibited by age and messages that encouraged “irresponsible or excessive participation in sports wagering.”
The code failed to outline ethical practices regarding the number of advertisements that should be released and did not warn against oversaturation across platforms.
The absence of a neutral third party to oversee regulation proposes several problems for those drawn to the high-risk, high-reward format sportsbook operators depend on. Even with the AGA’s new regulations, self-policing on social media remains inconsistent. Users like Barstool Sports and McAfee seem to encourage irresponsible betting without consequence.
For Coloradans, the dangers of gambling pose a new threat. After the 2018 decision to allow states to vote on the legalization of sports betting, Propp DD—a measure to legalize sports betting in CO—narrowly passed with 50.8% of the vote this May. FanDuel and DraftKings spent $1.5 million backing the measure.
The measure’s main appeal was to raise tax revenue for CO, fund the $40 billion water management plans, the surplus of taxes going towards efforts to combat gambling addiction, local government and the Division of Gaming. The benefits of legalized sports betting are hard to ignore, and a path towards illegalization is not necessarily the answer. The taxes will be extremely beneficial to Colorado’s water management, and the public’s democratic right to choose must be respected. However, to protect the consumer, further regulations must be imposed by a third party.
Even with the delayed return of sports, gambling has not faltered. In Colorado, $25.6 million was spent in May, $38.1 million in June and more than $59 million in July. Table tennis accounted for the majority of the betting, and a recent rise in the popularity of eSports gave sports betting platforms a new avenue to pursue. Additionally, under Colorado sports betting law, there is no maximum amount that one can wager. This contrasts traditional gambling, where no more than $100 can be gambled in a single bet. Without regulation, many are left prone to irresponsible gambling and set up to lose.
In Europe, many countries have put regulatory measures in motion to limit the onslaught of aggressive advertising and impose a maximum on single bets. In the UK, Parliament members urged sports betting platforms to self-regulate during the pandemic, limiting wagers to 50 euros per day. The Ministry of Consumer affairs in Spain also proposed restricting gambling advertisements.
The February 2020 Royal Decree, if approved, will bring gaming advertising to a near-halt as a result of the “global health crisis.” The progressive proposition in Spain has led other countries in Europe to reevaluate their own regulations on advertisements. In a July report, a House of Lords Select Committee considered further increasing restrictions past a voluntary “whistle-to-whistle” ad ban, which prevents betting adverts from being shown five minutes before and after a live sporting event. The newly proposed recommendations seek to extend the 9:00 P.M. watershed, at which point anything goes, to eleven o’clock at night and remove ads from teams’ jerseys.
The industry’s rapid growth in the United States is set to surpass the UK hub in the coming years, and lessons should be learned so similar mistakes are not made. Currently, Colorado’s sports betting legislation only covers immediate concerns of misinformation, failing to address the effects an oversaturated market can have during the pandemic.
With the recent legalization of sports betting and the threat of the pandemic, many Coloradans have been put in a position of unique vulnerability. Confined to their homes, anxieties are heightened. As a result, the oversaturated advertisement market leaves them vulnerable to addiction that can be easily fulfilled by the accessibility of online betting. Though the legislation may be new—and is ultimately valuable to developing infrastructure—consumers would benefit from added regulation addressing advertising and imposing a maximum amount allowed for a single bet.
The sports betting industry is in a rapid state of growth, predicted to be a $94 million industry by 2024. Corporations like DraftKings and FanDuel make millions off users with each passing year because, as is true with any casino, the house rarely loses. But in times as tumultuous as these, wager limits and advertising restrictions are more than necessary to maintain the safety of at-risk individuals.
