The early returns for Nebraska sports betting have arrived. And they’re not great.
The debut of sports betting in Nebraska ended up taking place in June of this year. Just recently, the state released figures for the opening days of the launch. Exact numbers weren’t provided, but the Omaha World-Herald’s Joe Dejka wrote about the overarching takeaways:
“Nebraska’s baby step into legal sports wagering last month didn’t bring a windfall of revenue to state and local coffers. The revenue numbers reflect the proceeds from just nine days of betting at a single casino in Lincoln. While tax revenue collected from the state’s racetrack casinos rose overall in June compared to May, the WarHorse Casino in Lincoln saw a dip in gross proceeds for the month, despite its exclusive launch of sports wagering, according to state records. Grand Island Casino and Resort saw a dip, too.”
So, uh, what gives? Should The Cornhusker State be worried about the future of sports betting? Or are these early returns easily explained away and nothing over which to lose sleep? Could it actually be a little bit of both? Let’s get into it.
Poor Timing Played a Role in Early Nebraska Sports Betting Revenue
Optimistis will be quick to point out that the timing of the Nebraska sports betting launch did not do the state any favors. Retail gambling services debuted in June, which is a notoriously slow month for sports betting. The NFL season is still months away at that point. Meanwhile, betting on the NBA Finals as well as betting on the NHL Stanley Cup is wrapping up. Major League Baseball and Major League Soccer are the only higher-profile North American leagues playing out their schedule in June, July and most of August.
To that end, any Nebraska sports betting revenue data should be taken with a metric ton of salt. It will be more interesting to see how they fare between September through the end of January. Those are the prime months for betting on the NFL and betting on NCAA football, which are two of the biggest North American gambling draws. In particular, betting on the NFL playoffs and Super Bowl (late December through early February) and betting on the college football playoffs and National Championship (mid December through early January) are mission critical parts of the calendar. Nebraska sports betting should be judged on how it performs during that span.
State officials have said as much after the underwhelming launch results came out. But this raises the question: Should Nebraska sports betting have built their launch around the football season calendar? Many other states have done this in the past. Last year, sports betting in York debuted just in time to capitalize on NFL playoff betting odds. The folks in charge of launching Ohio sports betting did the same, ensuring the services went live on January 1. Kansas sports betting, meanwhile, took it a step further; their operations rolled out on September 1, 2022, right in time for the start of the 2022 NFL regular season.
Granted, not every state has built their sports betting launch around the football calendar. But most have taken tentpole events into account. For example, March has historically been a semi-popular time to launch. This allowed states to capitalize on March Madness betting.
This would seem to imply Nebraska dropped the ball. But not everyone agrees. Denny Lee, chairman of the Nebraska Racing and Gaming Commission, even said he’s happy about the timing of the launch. By going live during a “non-peak” period, he believes Nebraska’s services will run more smoothly as the state enters busier portions of the calendar, such as the one we’re in now.
So, Does That Mean the Early Returns from Sports Gambling in Nebraska Don’t Necessarily Matter?
Please forgive us for hedging, but the answer here is both “yes” and “no.”
On the one hand, it’s true that the initial returns mean very little relative to the calendar. Legal sports betting in Nebraska will certainly take off in the coming weeks and months, as we get deeper into the professional and college football schedules. The state should only be concerned if September, October, November, December, January and February revenues tank relative to expectations.
At the same time, we cannot just dismiss the less-than-modest results from the recent report. If nothing else, they show the limitations of legal gambling without allowing residents to bet with online sportsbooks in the United States.
Industry experts are constantly parroting the growth of mobile wagering for a reason. We live in a world increasingly reliant on technology and remote services. Online sports betting is now the primary mode of legal gambling for Americans. Heck, it’s even the primary mode of illegal gambling when taking into account how many bettors still flock to well-known offshore sites.
For the time being, online sports betting in Nebraska is not allowed. They only permit on-site wagers. What’s more, they also don’t allow betting on college teams playing inside the state unless they’re participating in a tournament, playoff or championship. When considering how popular the University of Nebraska football team remains inside the state, this is yet another factor that could repress sports betting revenue.
State officials no doubt will have taken all of this into account when formulating internal expectations. Whether they also factored it in when projecting month-over-month and year-over-year growth remains to be seen. Regardless, as long as Nebraska sports doesn’t include a mobile option, the state’s revenue will likely always pale in comparison to others.
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