The 1% that could cause a problem with the USA Sports Book Industry. Only three months away from the June deadline and a decision on Sports Book in NJ and experts are already questioning its viability. Indeed, on March 15th J. Todd exposed a 1% request by the NBA that could sink sports book in NJ.
So what is the 1% for?
According to Todd, the NBA wants a cut of the Sports Betting action. Indeed, 1% to be precise. This was exposed when Dan Spillane submitted a proposal to NY Senate. At the moment, the NBA’s General Attorney formally confirm the support of the league but asked for a 1% compensation. This 1% compensation would be on top of every bet placed by punters.
Of course, for now, this would only apply to NY. But since NJ is leading the efforts to legalize sports betting nationwide, it’s a case we need to follow. And perhaps who knows if the NBA is successful in getting a 1% cut in NY, it’s likely they’ll ask for similar compensation in NJ.
What is the 1% for?
According to the news, The NBA is asking for compensation for any compliance related expenses. But also for any cost associated with the enforcement of the new regulation. All and all, if we make a direct 1 to 1 comparisons with last months figure and apply the 1% the NBA wants. Plus, if we extrapolate that Sports Book produced 30% of lasts month’s figures. Some believe that The Golden Nugget punters could generate as much as $23,000 to the NBA. (based on an estimation of $7,885,648 profit and accounting that Sports Book produced 30% of it.)
Now, at first, the 1% may seem very reasonable but if you further extrapolate the figures and apply them nationwide. Well… You get the idea… And above all, Spillane suggests that the punters bare the cost. And, THAT, could cause a problem which would affect its viability according to some.