Wanna bet? Answers to 10 key questions about sports gambling in Ohio – Crain’s Cleveland Business

It's been just over two months since Gov. Mike DeWine signed House Bill 29, legalizing sports gambling in Ohio. Since then, it's a safe bet that you've asked or heard someone ask this question:

"So, when can I place a bet?"

Adam Suliman can relate. The vice president of Sports & Digital Gaming for JACK Entertainment gets that question a lot and not just from reporters.

"My friends and neighbors certainly ask me frequently, but I've answered them enough that they've left me alone at least for this past weekend, but I'm sure I'll be asked again

this weekend," Suliman said, laughing. "I try to explain to them that this is gambling, and it needs to be regulated, and there are rules that have to be put in place, and this is something that this state has never done before, so we have to do it the right way.

"I think when you put it like that, folks understand. Nobody wants an industry to go out there and not do well, so getting it set up the right way is absolutely what we need for any gambling product."

To that end, this article will answer 10 common questions about sports gambling in Ohio, with help from Suliman; Matthew Schuler, the executive director of the Ohio Casino Control Commission; and Eric Ramsey, an analyst for the PlayUSA.com network, which includes PlayOhio.com.

1. So, when can I place a bet?

No later than Jan. 1, 2023, but probably not sooner.

When DeWine signed the bill on Dec. 22, there was hope that the rules and regulations could be in place in time for, say, football season or the World Series, but that's not likely, Schuler said.

"As soon as they passed the bill, folks were like, 'Why can't we game?'" Schuler said, laughing. "The Jan. 1, 2023, start date was done by the General Assembly in a very specific way. They had consulted with us and walked through the statutory process, so it was a very deliberate date. It wasn't just picking a convenient date and letting the commission drift into it. We walked through kind of a best-case scenario of what kind of time would be needed to meet the statutory requirements, and they set the date."

The bill actually passed Ohio's General Assembly on Dec. 8. Had it passed sometime later, the start date would have been 12 months later, Schuler said.

2. Where will I be able to place a bet?

Lots and lots of places, with Ohio state Sen. Kirk Schuring calling it the "most comprehensive sports gaming law in the U.S." The bill allows for 25 Class A licenses, which are for mobile and online operators; 40 Class B licenses for brick-and-mortar locations such as sportsbooks; and 20 Class C licenses, which are for self-service kiosks like the lottery terminals you see in bars.

"It's probably the best set of sports betting policies in the country," Ramsey said. "Ohio is on a really, really firm foundation."

3. What will I be able to bet on?

Lots and lots of sports. The NFL and the NCAA men's basketball tournament are the two big ones, but Ohio will allow bets on everything from pro sports to college sports to the Olympics to esports.

"What we're seeing in the United States and other countries around the world who have experienced this long before us is that sports betting is not as seasonal as it once was," Suliman said. "The amount of wagering that has taken place on the NBA this past season has rivaled the NFL. And a big part of that is the product offering that is available now versus 10 years (ago) in the United States. In a mobile and online environment, it's very easy to show customers what's available. We have statistics that explain the market that they're betting on.

"So if you're talking about tennis, for example, not a lot of folks would know the participants, but we can give them enough information about the participants that they can feel confident about the wager that they're placing."

4. What should I know about the rules and regulations process?

OK, you probably didn't actually ask this question, but it's still an important one.

Ohio has a business-friendly process that allows for input from the stakeholders, Schuler said. Once a rule is approved by the OCCC at a public meeting, it then goes to the Common Sense Initiative headed by Lt. Gov. Jon Husted and then the Joint Committee on Agency Rule Review.

The stakeholders and in the case of sports gambling, Ohio has more than 300 have two weeks to give responses before the OCCC then reviews them. The OCCC allows for two rounds of responses before approving them at a public meeting.

From the time it leaves the OCCC to the time the rule comes back to the OCCC for its final filing, it takes about six months, Schuler said. The OCCC sends out these rules in batches, with the first batch for sports gambling going out on Dec. 27.

"There's a lot to be done and it could probably be done quicker, but it's hard to fault Ohio for wanting to make sure all the 'i's' are dotted and 't's' are crossed," Ramsey said. "This is an industry that's going to be around for decades, so it's important to get it right."

5. How will most people place their bets?

About 80% to 90% will be online, with the majority of those on mobile phones.

Case in point: In November 2021, close to 95% of all bets placed in Michigan were made online, up from 76.3% in January of that year. In Pennsylvania, online bets make up more than 92% of the handle, while Indiana and New Jersey (both 91%) show similar numbers.

6. Who will be the major players?

FanDuel, DraftKings and BetMGM control about 75% of the market, with those three companies referred to as the Big 3 in sports gambling.

FanDuel and DraftKings got a leg up by first offering fantasy sports gambling, while MGM and Caesars (the fourth-biggest brand) are well-known due to their casinos.

7. How big will this business get in Ohio?

Estimates vary, but PlayOhio.com is bullish, believing it will generate between $9 billion and $12 billion in bets as soon as the market's third year, which would produce between $700 million and $900 million in gross revenue each year.

Suliman expects something more than $500 million gross revenue when the market matures.

"I don't know if it will crack the top five (nationally), but you can probably put it in the top 10," he said. "There's a lot of people in the state. A lot of sports fans."

8. How much tax revenue will Ohio get?

Not as much as you might think. The bill taxes net revenues at 10%, with 98% of the money going toward public and private schools and 2% for problem gambling programs. The legislature's researchers expect betting to deliver about $20 million in new tax revenues, and $10 million in licensing fees the first year.

"Broadly speaking and this is something we're slowly learning in the U.S. sports betting is not a big tax generator," Ramsey said. "There's no path to generating budget-changing tax revenue in Ohio. At most, you're talking maybe $100 million in new tax revenue, which isn't Earth-shattering. If I have a small bone to pick with the policy, it's that they could have gotten away with a higher tax rate without ruffling any feathers."

9. Who has been active so far?

Among local sports teams, the Cavaliers have been the most aggressive. They've already signed deals with Fubo Gaming and Caesars, with the latter partnering with the team on a 10,000-square-foot sportsbook that will be built inside Rocket Mortgage FieldHouse.

The JACK Cleveland Casino and JACK Thistledown Racino will both offer Las Vegas-style sportsbooks at their locations, as well as online betting.

The key, Suliman said, is right-sizing those sportsbooks. Las Vegas-style doesn't mean Las Vegas-size.

As the saying goes, you don't build your church for Easter Sunday.

"It's a balancing act, for sure," Suliman said. "We have a great design and construction team here, and they've spent a ton of time traveling all over the country and trying to pull best practices from those regional markets. We feel like we've honed it in. It's not going to be a superbook like what you see in Las Vegas because if we did that, it would be empty a lot of time or feel empty even if you have 100 people in there. For us, it's about finding that balance."

Since so much betting will be mobile, companies like JACK Entertainment view the retail sportsbooks as something that complements the other betting options such as table games and slots, Suliman said.

"Now we have something else for customers to enjoy," he said. "Those game days, the NFL Sundays when the Browns are playing, those sportsbooks are going to be jammed. So for us, it's about how do you program (those) retail sportsbooks on those days when it's not obviously going to packed and still make it fun and exciting, and I think there's a lot of great ways to do that."

10. What are the odds on the Browns winning the Super Bowl?

That depends. Do you mean next season or in your lifetime?

If it's next season, the Browns are +3000 to win the Super Bowl, meaning you'd win $3,000 on a $100 bet.

If it's your lifetime, well, as Browns reporter Tony Grossi likes to say, "Smoker or nonsmoker?"

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Wanna bet? Answers to 10 key questions about sports gambling in Ohio - Crain's Cleveland Business