The Herd with Colin Cowherd - The Favorites - The Battle For Legal Sports Betting

Episode Date: May 27, 2022

The federal ban on sports betting was struck down by the Supreme Court 4 years ago this month. Since that decision, nearly half of all states and Washington D.C. now permit legal sports betting in some form. To get a summary of all the legislative flury that's taken place since 2018 and to hear insights on the legal road ahead, hosts Chad Millman and Simon Hunter invite on Action Network industry reporter Sam McQuillan (@Sam_McQuill) to the show. Sam provides the latest news on where the latest legalization efforts stand in California, Florida and across America. #HerdSee omnystudio.com/listener for privacy information.

Another podcast from some SNL late-night comedy guy, not quite. Unhumor me with Robert Smygel and Friends. Me and hilarious guests from Bob Odenkirk to David Letterman help make you funnier. This week, my guest, SNL's Mikey Day and head writer Streeter Seidel help an a cappella band with their between songs banter. Where does your group perform? We do some retirement homes. Those people are starving for banter.

Listen to humor me with Robert Smigel and Friends on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. Imagine an Olympics where doping is not only legal but encouraged. It's the enhanced games. Some call it grotesque. Others say it's unleashing human potential. Either way, the podcast's Superhuman documented it all, embedded in the games and with the athletes for a full year.

Within probably 10 days, I'd put on 10 pounds. I was having trouble stopping the muscle growth. Listen to Superhuman on the I-Hard Radio app, Apple Podcasts, or wherever you get your podcasts. On the Look Back at it podcast. From 1979, that was a big moment for me. 84 was big to me. I'm Sam Jay.

And I'm Alex English. Each episode, we pick a year, unpack what went down, and try to make sense of how we survived it. With our friends, fellow comedians, and favorite authors. Like Mark Lamont Hill on the 80s. 84 was a wild year. I don't think there's a more important year for black people. Listen to Look Back at it on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. The Favorites podcast is presented by Fandual Sportsbook.

There's no better place to make every moment more than with Fandual. I bet with Fandual because they're safe and secure. They offer great odds and markets across the NBA, NHL, and more. And because it's fun to combine multiple bets into same game parlase. So if you're new, just download the Fandwell Sportsbook app to get started now. Sign up with promo code favorites so they know I sent you. He must be 21 and over in present in Arizona, Colorado, Connecticut, Indiana, Michigan, New Jersey, New York, Tennessee, Virginia, West Virginia, or Louisiana. Gamble problem. Call 1-800-next-step or text. Next step to 533342 in Arizona. 1-800-G or visit Fanduel.com slash RG in Colorado, Indiana, New Jersey, and Virginia, 1-888-789-777, or visit ccpg.org slash chat in Connecticut, 1-800-2707-1-17 for confidential help.

Michigan, 1-877-770 S-T-O-P in Louisiana. Call the Tennessee Red Line 1-800-8-9-9-9-7-89 or visit 1-800-Gambler.net in West Virginia. Welcome to the favorites, the podcast from the Volume Podcast Network. I am Chad Milman, Chief Content Officer of the Action Network. It is May. We are winding down the conference finals in the NBA. My BFF, my companion, my compadre, professional better, Simon Hunter. What is going on, buddy?

We got a lot of activity. And the rest of this show will be dedicated to some of the most burning questions for betters across the country. Don't give it away yet. Don't give it away. Just say hello. Hey, Chad. Yeah, it's a fun time in the year.

Since our last show, I've had a lot of people reach out to me about coming to Germany about coming to Chicago. I mean, we're at a world tour show, Chad. So, yeah, I know you're feeling. Who called you about Germany? I'm just getting like random DMs and messages about coming to Germany. And I was like, did we even say we want to go to Germany? I think we were just talking with the Seahawks.

Well, A, when I say, remember, I'm old. So when I say call, I use that as a euphemism, a broad euphemism for getting in touch with. I could say DM, I could say texted. I could say who snapped. you. I could say who my spaced you. Could say a lot of things. I just say call. It's an umbrella term. That's right. Now, if you are old, I mean, there's no denying that. Generationally. Did you get any offers from anybody who's willing to host us in a suite

for the Bears Eagles game in December where we both want to go to see our teams play, but I am too old and fragile to sit outside in December in Chicago. I know my limits. No, it was more like you and Chadne to come get to. drunk with me before the game or come party with me before you guys going. I was like, hey, maybe we will, but Chad might be a little too classy to be standing out in the cold and the freezing cold drinking, but I would be down in Soldier Field. The Germany one's fun. Basically, I think a guy knows I love BMWs and he DM me and he works for BMW in Germany, and I'm all in. Like, this guy, like, I got money to burn. This guy's telling me he'll come out

there and show me the whole factory and the works of BMW. I'm probably going to take him up on that offer because that's been a dream of mine. So again, Chad, everything I give to you, you give me back tensfold. All my dreams keep coming true because of these great fans. We're going to get together in a couple of weeks and we can celebrate our love for each other. I'm going to be in Philly in June. I called you earlier this week. We're going to go to a Philly's game that night. We're going to see the Phillies and the Diamondbacks. You know I'm doing the night before? The night before I'm seeing Coldplay at the link. What a week for Simon. Dude, that is a great week. You know who's on the way to see Coldplay right now?

Our good friend Colin Wilson, he is driving from Oklahoma to Chicago. I was just on the phone with him. And he's on the way to see Coldplay in Chicago. I heard it's an amazing show. So did I. So I had to buy tickets. I mean, I heard it's, I, yeah, got to do it. A buddy of mine in the Bay Area and my sister in the Bay Area, both went to see him in the Bay Area and independently text me the next day, they said it's ridiculous. Like, it's so good. You know what else is good? Tell me. Warriors and Five. Who said that a couple weeks ago? Was it, was it Chad Milman, wise guy, who moves lines, who can see what's happening on the court who understands recency bias? And when two NBA experts are saying to him, hey, this is why Dallas can do well in this series. I'm saying,

that's great. Warriors in five. Chad Milman is proud of himself. God, I hope you're right because I have a lot of money riding on it. Do you? Would you get a plus 500 or something like that? Or like plus 352. I bet it after game one. I was just like, I think Chad might be on something. Dallas just looked way out of their element. And then once it was up 30, I got a little nervous there

because it looked like it was going to be actual sweep. But luckily they did what they should have done. And they're taking it back home. Sometimes I'm so good at this. It's almost uncanny. And the other day I was driving my 15-year-old son and two of his buddies from someplace. And we were talking about the Mavericks Warriors game. And the Warriors were up 3-0 and the game was that night, game four.

And they said to me, who do you think is going to win? I'm like, the Mavericks. This is a no-brainer. Like there's no way the Mavericks aren't going to win this game. The Warriors don't do sweeps. They do gentleman sweeps. That's true. Yeah, statistically you're right. They usually just ended it at home.

So listen, Simon, four years ago this month, the Professional Amateur Sports Protection Act, which had made sports betting illegal, was repealed by the U.S. Supreme Court. That was a game changer in a lot of our lives. At that point, I had already left ESPN. I had left ESPN in September of 17 to help launch the Action Network. So we were seven months into it. We were three months into a business at that point, four months. We had launched in January. We took a flyer.

We took a gamble. We wanted to be there when the business started. It happened much sooner than we thought. All I remember about that day is the number of texts that flooded in from friends saying, oh, my God, sports betting is legal. Are you freaking out? I remember I was on the phone with Matt Mitchell, said I had to go. And I remember my mother-in-law texted me and said, oh, maybe it wasn't a terrible idea to leave the SPN.

That to me felt like real vindication. You needed that, huh? I did. Desperately, desperately needed it. Four years later, the business is exploding. States are legalizing. What did we do at action? We recruited, poached, stole, hired, whatever you want to say from Bloomberg.

A multinational media outfit. Credibility at the wazoo. But we'd become so big. McQuillan, who was covering a variety of things for Bloomberg, including sports betting, came to join us at action to cover the legalization beat what's happening with legislation everywhere all over the country. He's killing it. Breaking stories nonstop. He knows more about what's happening in every state and with the bills that are being passed or not passed in every single state than just about anybody out there. And today, Sam is joining us on the podcast,

level setting where we are in the landscape of legalized sports betting. Sam, thanks for coming on, buddy. Happy to be here. Finally make my appearance on America's favorite podcast. Thanks for having me. Oh, look at that. We didn't even prompt that, Simon. There's a lot of things to discuss. And there's probably four categories. Matt Mitchell in a pre-production slack broke it down for us. There's four categories. Fully online, this means you're in a state where online,

and in-person betting is available, in-person only, betting permitted at brick-and-mortar locations only. That's idiotic. Why anyone would do that? Then they're really not even trying. In process, the state legislature in each state is progressing towards some form of legalization and then fully offline. Because remember, passable being repealed just meant that any state could do what it wanted

to do. There was no federal law instituted by Congress that says, okay, this is what it looks like around the country. it is full on states rights. Every state can do how they want to do it. The states that have done it the best, New Jersey, for sure. And you could argue New York, which in the span of five months has become the biggest betting state in the country.

What do you think about New York right now? If you're New York and you just want money and taxes, you've done a great job. I think they've taken them like $200 million in their first four months. first month they took in $65 million, which blew every record out the water, which is crazy for your first month. Newark was sort of a situation where the former governor, Andrew Cuomo, who's now resigned, wanted, he was like, we'll only have sports betting if we make a ton of money out of it. So they ended up passing with a 51% tax, much to operators dismay. It ended up passing, but they set up shop there anyway. There was a ton of promotions to start,

but we've already seen companies sort of scale that back, say, hey, maybe this is untenable. We don't know if we can do that. Executives from BETMGM and Caesars have spoken about, you know, cutting back their marketing and saying, hey, this is going to be passed down to the consumer. It's not sustainable. But the fact of the matter is we haven't seen it passed down the consumer yet, the money it costs. And we've still seen, you know, companies come in and want to take up as much as the market as they can. Because what really happens when you break into a state is there's sort of this mad scramble.

I'm sure you guys have seen all the advertisements everywhere to soak up as much of the market as you can. And then sort of the game plan is maybe a year or two years, we'll scale that back once we have the customers, cut the promos. So New York is really great right now for the state. It's bad for the operators because they're giving away so much money to the state. But we haven't really seen the actual impact of that on the better yet. So definitely a huge appetite to bet in New York, but it kind of remains to be seen how to end up. Well, the way they've been passing along, actually, is in New Jersey sale line is minus 110. In New York, that same line might be minus 130 on all the books. I most interesting thing to me about the New York is it feels like it was a good test to show how important opening weekend is to get your book open and operated where Fando I look at the numbers.

They have this huge lead above DK, Cesar's, all these other books in that state. Just because that first weekend Fando was up running with I think it was like a match up to a $2,000 promo is what they were doing. Yeah, there's a lot of money. That's really worked out for them. And now you hear them crying being like, oh, these 51% tax, like they knew that going in. So I do think they're going to have to redo it just because there's only going to be two or three big time books. But if the state's going to keep getting money and these operators stay there, maybe they won't because they're just saying, you know what? Who cares? We have the biggest betting state in America. Why will we change anything? So do you see anything change anytime soon?

So when they passed it, there was optimism between a lot of lawmakers. You know, we can lower this on the back end. We just want to get this done because Cuomo wouldn't allow it to happen without the 51% tax rate. Now that he's out, you know, the new governor, she's been a lot more sort of welcome. welcoming to adding gaming to the state. She just signed a bill that's going to authorize three new downstate casinos, which as a New York native is pretty wild to imagine that happening. But they tried to lower the tax rate during the budget this session and we're ultimately unable to. The two lawmakers that have really been championing it have been saying, you know, we're going to convince the legislator to change it and make it better as things go. You know, you talked about the product being worse for the consumer than in New Jersey.

But the fact of the matter is until New York starts losing revenue, if I'm a lawmaker, I really have, I don't care if the books are making less money. I don't care if people are getting worse lines. That's not my bottom line as a lawmaker. I want to make as much revenue for the state as possible. And New York's been killing it. You've seen a little bit of a drop in the past couple months, but it's still so much more compared to the other states,

the money they're getting. And that really is just because of the high, high tax and how many people are in the state. So the bottom line is until we see that money drop and the state make less, it's not going to change. And it'd be really tough to. They're definitely going to try, but no time soon, I don't think it's going to change. New York has done it right for the consumer. And when I think about that, I only think about can I do it from my phone and how many markets are available, right?

I'm in Connecticut. I can do it on my phone, but I've only got three operators. I've got Draft Kings. I've got Fandul. I've got Bet Rivers. In New Jersey, low tax rate, tons of operators, and I can do it from my phone. Illinois, finally doing it right after letting more operators in and allowing consumers to do it online. What states right now are in Category A, which is the fully online category?

So there's about 20 states plus Washington, D.C., which are fully online, meaning that you can bet on your phone, on your computer, and you don't have to go in person to sign up. Nevada is the only place where you have to go in person to sign up still, but they're special because they're Nevada and they've been doing it forever. So it's New Jersey, Pennsylvania, New York, Illinois, Michigan, Virginia, Colorado, Indiana, West Virginia, Rhode Island, Arizona, Oregon, Connecticut, New Hampshire, Louisiana, Tennessee, Wyoming, Arkansas, Iowa, and Washington, D.C. Like 20 states fully online, that's a lot, 40% of the country. How many more states? can we expect to be fully online? The real question I'm asking is, how many states overall

is it possible to get fully online given how many are in person only and how many won't ever allow it? That's a great question. You alluded earlier to in person being idiotic. Why would they do that? You know, like you have to travel miles in some places like North Carolina to go bet at a casino. I think it's three hours from Charlotte to North Carolina's closest casino. which is pretty tough, but one of the good reasons they do that is because it's much easier to pass in-person betting only. And now North Carolina is actually looking at, okay, now that we did this in person seems to be working, you know, the sky hasn't fallen apart. Let's expand it online. And there's a big appetite for that there. So some of those in-person states, there's about

10 of them. They're looking at, okay, now what's the next step? Can we go online? There's about six states, which are fully offline, which means that they'll probably, unfortunately, in the next couple years not past sports betting. Those are your Utah's, which in Utah, there's not even scratch off tickets. I don't think the idea that they'd be open to online gaming is pretty far-fetched. Idaho is in that category as well as Alaska, Hawaii and Oklahoma, which have a lot of sort of strong religious presences in the state, which are opposed to gambling. Then you have Texas as well, which has been some more optimism there. Governor Greg Abbott is opposed to sports betting. He's up for re-election, I believe in November, one of the candidates he's running against

Veda O'Rourke, you might have heard him. He is for sports betting. So I don't know if that's really going to sway the election that sports betting has a single issue voter. But the good news is there's optimism there and they'll probably renew a bill sometimes soon. So yeah, that's about, you know, six states where it'll never happen. And there's about five where we're just waiting. Maryland has launched their retail casino operations. But it's been a little over two years since voters legalized sports betting in Maryland. And there's still no timetable. for when it's going to go online. They kept pushing back, pushing back the date. They're in the sort of regulation process now, which is what happens after a state passes a bill. Operators need to be approved. Applications need to be looked at. There need to be background checks. It's all very involved. And Maryland has consistently kicked it down the road. They're waiting on some special study. We don't know when that's going to happen. Ohio is also going to, they've already legalized. They're going to launch by the end of the year they announced last week. It'll be sometime around late December, January 1st at the latest. So that's another state that's going to jump online, Ohio.

Obviously, a big sports state and home to a lot of people. So that'll be big for the operators. And then Kansas and Maine recently, they're the only two states so far this year that pass sports betting. Kansas, I think they're optimistic they're going to go on by football season, which would be great, great timing. And Maine probably take a little bit longer. And then we're still waiting on Nebraska, which is already in person, but they're yet to launch online. So hopefully that comes next year, maybe the year after. The playoffs are heating up and you can make every game feel like game seven on Fandual Sportsbook and official partner of the NBA.

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Imagine an Olympics where doping is not only legal but encouraged. It's the enhanced games. Some call it grotesque. others say it's unleashing human potential. Either way, the podcast's Superhuman documented it all, embedded in the games and with the athletes for a full year. Within probably 10 days, I'd put on 10 pounds. I was having trouble stopping the muscle growth.

Listen to Superhuman on the I-Hard Radio app, Apple Podcasts, or wherever you get your podcasts. A win is a win. A win is a win. Yep, that's me. Cliver Taylor the 4th. You might have seen the skisks of a win. hits, the reactions, my journey from basketball to college football, or my career in sports media.

Well, somewhere along the way, this platform became bigger than I ever imagined. And now I'm bringing all of that excitement to my brand new podcast, The Clifford Show. This is a place for raw, unfiltered conversations with some of your favorite athletes, creators, and voices that not only deserve to be heard, but celebrated. One week, I'll take you behind the scenes of the biggest moments in sports and entertainment. And the next, we'll talk about life, mental health, purpose, and even music. The Clifford Show isn't just a podcast. It's a space for honest conversations, stories that don't always get told, and for people who are chasing something bigger.

So if you've ever supported me or you're just chasing down a dream, this is right where you need to be. Listen to The Clifford show on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. And for more behind the scenes, follow at Clifford and at TikTok Podcast Network on TikTok. Do you remember when Diana Ross double-tap little Kim's boobs at the VMAs? Or when Kanye said that George Bush didn't like black people. I know what you're thinking. What the hell does George Bush got to do with a little Kim? Well, you can find out on the Look Back at it podcast.

I'm Sam J. And I'm Alex English. Each episode, we picket here, unpack what went down, and try to make sense of how we survived it. Including a recent episode with Mark Lamont Hill, waxing all about crack in the 80s. To be clear, 84 is big to me not just because of crack. I'm down to talk about crack all day, but just so you're not.

But just so y'all know. I mean, at this point, this is the second episode where we've discussed correct. So I'm starting to see that there's a through line. We also have AIDS on the table right now. Now you're finishing that sentence. Yes. I don't think there's a more important year for black people. Really?

Yeah. For me, it's one of the most important years for black people in American history. Listen to look back at it on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Look, that's how cute. I feel like there's one state in this conversation that matters. It will blow New York out of the water. And that's California. When is it going to happen?

What is it going to look like? Yeah. So California, yes, most populous U.S. state is about 19 professional sports teams there and a ton of sports fans. I get hit up with questions all the time. When is California going to legalize? The answer is it could happen at the end of the year. There's two ballot propositions, which people are going to be able to vote on

during the November election that would each legalize sports betting in a different way. One is being pushed by the state's native tribes, which right now have sort of a monopoly on gambling in the state. They want only to have sports betting at their casinos on their property, which makes sense if you're the tribes. And then the other is being pushed by the online operators, which are your fan duels, bet MGM,

draft kings, they want to be able to operate in the state. So what's happened is each group is openly campaigning against the other's proposal saying why it's bad. Online proposal is going to give a ton of money to homelessness, mental health services. That's sort of the way they've been championing it. Tribal proposal, their main issue is saying, hey, don't let these out of state companies come in the state. Once they come in, we'll never be able to get them out. They're going to want eye gaming in the future, which is going to hurt our bottom line. So combined between both groups, they've spent $175 million so far. And we're not even close to November. So if you live in California, you've probably noticed these ads saying, not saying, hey, vote for this thing,

saying, hey, don't vote for that one. Don't vote for this one. Which a lot of people are concerned is going to create sort of a cannibalization effect where people are so confused. They think sports betting is bad. Everyone's been telling them that. They're going to vote for neither. So what could end up happening is both could end up passing, which would allow online betting and betting on tribal lands. That's sort of your best case scenario, but it's going to be really complicated. And you're going to see more advertisements. It's going to get uglier. It seems like every week both groups release some sort of serve in a poll saying why the others is worse. And then you've got card rooms and other tribes that are involved in the mess as well. It's really, it's really a crazy

situation. But if online gambling does pass, lucky for California, different than New York, it'll be about a 10% tax rate. Operators that wrote the proposition were very smart to include that because I have no doubt in my mind if the tax rate was left up to the legislature, they'd say, hey, New York is making a ton of money. Let's just do it the way they did it. So if it passes, it'll be really good for the operators. But it's still sort of a 50-50, no idea what's going to end up happening there. Look, we're very invested parties in this emotionally, not from a lobbying perspective or anything like that. But our business did very well when New York went online,

when Michigan went online, when Colorado went online, when Illinois went online, our traffic increases, our revenue increases, California coming online, in the way that the operators are pushing in the ballot referendum would be massive for Action Network and massive, by the way, for all the other media companies that are covering gambling and all the operators. I'm going to let Simon ask a question next, but I do want to get your opinion, handicap it.

What happens in November? Oh, God. When is sports betting? What happens in November? And based on that, when are we live in California? Oh, man. So every time I make odds, I'm always wrong about them and I feel like a fool. But I'd have to say, join the club.

You'll fit right in on this show. I'd have to say, plus 250 that online gambling gets. passed just because of how uncertain it is, probably a better chance that only tribal gaming gets passed, but maybe around plus 150 there. And then as far as when you'll be able to sports bet, if they both pass, I think only God really knows the answer to that question. We've seen some states like Maryland take nearly three years. We've seen some states like New Jersey take nearly three weeks. California, I'm sure, is going to have a lengthy regulation process. They like to be very thorough, if you want to put it that way, about all their new laws and industries are bringing in.

So I'd imagine it would be more on the longer. Maybe sports betting online in California by mid-2024 for being optimistic, late 23. Everyone out there that if you're like me and you love to invest, I mean, I love investing. It's dark days right now in the gambling world. If you're if you've been buying gambling stock, a lot of these stocks are below what they, I mean, opened at. I know pens below, DKs below. If you need to take a step back and look at everything this man just lit out for you, Ohio isn't online yet.

California is not online yet. Texas isn't online yet. And to me, what I want to ask you about is Florida. What the hell is happening in Florida? Like it feels like it kind of just went away. They literally had sports betting. People were betting on their phones, in their homes, and then it's just gone. Yeah.

What's the update on Florida right now? So there is no real update on Florida. You're right, it was up for about two or three months. And basically what they did there was the state passed the law. The governor signed it, which allowed one tribe to have a monopoly on gambling. There are many tribes in Florida. They didn't like it. They didn't like that one tribe got exclusivity over it.

So what they did is they took it to court. They challenged it. There is a law called IGRA, which is the Indian Gaming Regulation Act, I believe, which has to do with Native American tribes and what they. how they control gambling. So they sued under that in district court, a district judge. They effectively paused the operations in Florida indefinitely. There's probably going to be an appeal, but it's in the court system's hands right now. So there's no timeline for the hard rock app to go back up. It's really sad because this could have probably been easily avoided if the state just allowed

all the tribes to partner. I'm not really sure why they gave a monopoly to one because it got challenged and struck down. So yeah, Florida is tough times ahead. There was a, there was a push to get sports betting on the ballot this year that failed. They didn't get enough signatures. And they won't be able to do that next year because of political rules. So it'll probably be at least until 2025 until you see any glimmer of hope in Florida. Just pure corruption. That's literally what you're talking about there. But yeah, my whole point with the whole stock thing, though, is just that I'm with people that I'm freaking out about it. But I still think it's, it's not full panic mode where it's like these things are going to grow.

It's still just very early in this whole sports betting thing. Like Chad just talked about New York is the biggest state we've added recently. We've seen what's happened with them. They've really blown up. So to me, I get the panic in the whole sports betting community with everything. But I just see there's just so much room for growth. It's just people want everything to be what it was during the pandemic where everything was all inflated. But I think now we're kind of at a balance here where it's like, okay, it's correctly priced and it'll go up from here.

So I would just love to hear where your view is on all. all these different sports books and their stocks because I constantly see it online, people talking about, well, sports betting is up. All these states are up. Why is the stock keep dropping? Yeah, no, that's a great point. And it plays to a lot what Chad says is that we are not anywhere close to the ninth inning of sports betting. We're maybe in the fifth, sixth inning. You know, we haven't even, we've had 70% of the states legalized, but as I said before, about only 20 or fully online. And what happens when, you know, a new state like New York legalizes is these companies lose a shit ton of money.

They go in. You see the ads everywhere. You see J.B. Smooth on your television talking about being a Caesar. You see, you know, Jamie Fox. Like, you see, they spend, these celebrities are expensive. You see, if I'm in D.C., I see advertisements everywhere. When a new state legalizes, that's not when the companies are going to make money. That's when they're going to lose a ton.

So we saw that MGM. We saw Sears scale back the promotions. It's gotten a lot of criticism as, as to your point, you're just spending money. When are we're going to see growth? but this is sort of a long-term hold kind of thing. I'm not by no means a financial advisor or whatever. These companies aren't going to be profitable for a long, long time still. The idea is right now get as many customers as possible,

spend all the money, get them to use your apps, convince them that your app is the best. Once California legalizes, they're going to lose even more money like New York. It's going to be insane. And people are going to freak out about the stocks. But, you know, it's a long-term thing. That's the whole idea of the business is, you know, eventually, hopefully we'll be profitable. But right now it's spend, spend, spend.

I feel like between my salary, my 401k, I got enough money tied up in the gaming industry. I don't need to go by the what could be perceived as depressed stocks in the public markets right now. I'm out of that game when it comes to gambling stocks. Well, you don't have 40 years to wait for them to build back up like me and Santa. Yeah. Look, my horizon is different. I'm in the back half of the game, I got to be thinking about retirement. I got to be thinking about, you know, buying a house in Florida.

I can't be thinking about, you know, 10-year horizons. I got five, maybe five left. Are you totally ill or something? I'm just old, Sam. That's going nowhere. He's addicted to it. I'm old. I can't keep up in this racket.

young bucks like you. All right, we talk a little bit about this. Florida fucked it up. Illinois, fucked it up for a long time. Louisiana, cockamamie rules tied a lot of the horse racing bullshit to betting and did it perish by parish. In every instance,

there is a self-interest on the part of the politicians who are putting these laws together that buddies have their hands out, relatives have their hand out. I'm not exaggerating to say that there is not even, as you said, Simon, corruption or even malfeasance. It's just incompetence. Like so many of the people who are making these decisions about how to design what gaming should look like and what sports betting should look like are just bad at it. Welcome to politics, Chad.

Yeah. They're just so compromised and bad at it. They don't think about what's good for the customer. they are only thinking, how can I personally extract value for something? And it's just, it's tremendously frustrating if you're in this business. And I think it has an impact on the stocks, too, because so many of the state-by-state issues, you change it everywhere you go. New York is charging so much.

New Jersey is charging less. New Jersey becoming more mature. New York is getting harder and harder to require customers. I mean, there's no just positivity in every single market. that said, long-winded question, who is doing it perfectly? So I don't know if there's a good answer for who's doing it perfectly. You know, you alluded to New Jersey, which has let many, many operators come in the state, kept the tax rate relatively low, which has been good.

You know, we've seen New Jersey be one of the top states. When Pennsylvania, they were one of the earliest, when they, you know, contemplated their law, they were contemplating a 36% tax rate, which ended up passing. And the operators said, oh, no, no, no, that's too high. will never be profitable, you know, the cost is going to get passed down to the customers. We can't do that. A couple of years later, Pennsylvania is, you know, one of the states they've seen the most money in. And now you have, and then you have states, I mean, 36% compared to New York's 51% is, is nothing. There's more states that are doing it terribly wrong than states that are

doing it terribly right. We can talk about Washington, D.C., which is where I usually am calling in from. They only let one operator, their state lottery, run online betting. And in terms of you've seen your average line on a game, probably minus 130, minus 120. I have to pinch myself sometimes when I see plus money on the juice. It's really, it's just terrible. And their app went down during the Super Bowl, leaving people with no other options to bet. If you're a state, don't rely on one mobile operator. Chances are they're going to take advantage of the customer.

Chances are they will go down during a very important time like the Super Bowl. We've seen a lot of states to allow operators to deduct or rather write off any revenue tied to promotional bets. That's stuff like free $25 bets on your next game or whatever, free $50 or 50% odds boost on this thing. We've seen a lot of states do that recently, which has whittled down the revenue they expected. Some states have looked at sunsetting that where after a few years, once the operators, supposedly acquire the share of the market they want to through all these vast promos, the state stopped letting them deduct for that. So there's really no one state that's done it perfectly. I mean, you can look at Nevada. I'm sure people think they're doing things well,

but it's more so what not to do, what states to avoid. We've seen a big obstacle to be states where there are tribes like Florida. It's probably a good idea not to piss off any tribes like you've seen in Florida with them suing and blocking the law. You have other states like Minnesota where they tried to pass something. And for years, tribes have been opposed to sports betting because what they considered would have let racetracks and casinos and non-triks get on the action. And they were going to pass, you know, a tribal monopoly bill. Once they said, hey, let's amend that.

Let's let the racetracks participate. The tribes filled it with a huge lobbying presence. So there's a lot of different things you sort of have to navigate. and every state is complicated in its own way. But I would say as many operators as you can, keep the tax rate relatively reasonable. It doesn't have to be super low, but don't make it super high.

Otherwise, you might see the effects of that come in later. And the rest of it is just learning. We have to see what's going to work well in these states. What's not, New Jersey's been great because it's done all those things I mentioned. All right, Sam, that's a pretty good roundup. I think what you're saying is be customer-friendly and let's root for good news in California.

Let's root for good news in Ohio. I feel very informed. I'm very informed. That's my job. I'm much smarter about betting right now than I was before. I don't know if I can make a better prediction than Warriors and Five, but, you know, I feel like at least I know what's going to happen next in every state. Who's going to be in the finals?

Why don't you shoot your shot now? Is it Denver's Boston? This has been a tough one. I've been thinking about it a lot. You know, I watch every game. I listen to NBA radio in the morning. I'm a huge NBA fan. Definitely going to be the Celtics and the Warriors.

And I'm having a hard time seeing who wins. Wow. The Warriors are just so good and they're so deep. And the way Steve Kerr has gotten Moses Moody and Jonathan Kaminga to get real quality minutes, Jordan Poole, obviously has been playing well throughout the playoffs. Like, you know, he's just giving young. players who are super athletic, real time on the court, that's going to be invaluable in the finals. So I'd love to see Boston win it. I love their coach. Love what the team did this year.

I like teams that are patient and turn around. I like the way they built their team. I'd have to go Warriors and Six. Thank God. Boston fans are the worst. They have enough championships. Stop giving Boston more championships. I don't mind Boston fans. I don't mind. That's been the podcast. This has been the favorites from the volume podcast network. I am Chad Milman for Simon Hunter, for Sam McQuillan, our legal reporter. Follow Sam. In addition to finding his stuff on actionnetwork.com and in the Action Network app, follow him on the Twitter. At Sam underscore McQuil, M-C-Q-U-I-L. For producer, Matt Mitchell, download us from Apple Podcast from Spotify, wherever you get your podcast, rate, review, subscribe, give us five stars, say anything you want.

Feedback is a gift. Until next time. Love you. Another podcast from some SNL, late night comedy guy, not quite. Unhumor me with Robert Smygel and friends. Me and hilarious guests from Bob Odenkirk to David Letterman help make you funnier. This week, my guest, SNL's Mikey Day and head writer,

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