Verizon Communications is considering entering the sports betting market if American laws change this year, according to a report by Bloomberg. Citing sources familiar with the matter, the report says that the telecom giant is speaking to experts on the subject to discuss the potential of an online sports betting operation.
While Verizon did not comment on the report, there are reasons to believe the company would have an interest in online gambling. When the company purchased Yahoo for $4.5 billion, it took control of a large fantasy sports operation with tens of millions of users. That includes a daily fantasy sports operation that is active in most US states.
Verizon’s Massive User Base
Currently, that daily fantasy operation lags far behind DraftKings and FanDuel in the DFS marketplace. However, Verizon has some big advantages going forward that could make it a serious sports betting competitor.
That starts with the corporation’s massive user base. There are more than 100 million subscribers on the Verizon mobile network, and Yahoo has about 1.3 billion users. Verizon also has streaming rights to some NFL and NBA games, which could be used to facilitate in-play betting.
The NBA and Verizon have also invested $25 million to create new fantasy products, including fast-paced quarter-by-quarter games. NBA Commissioner Adam Silver sees such initiatives as a way to keep fans invested and engaged in games even when the on-court action isn’t exciting.
For all of the potential in the idea, there’s no guarantee that Verizon will follow through on this effort. One of the sources quoted in the Bloomberg report noted that Verizon had previously looked into online gambling, but backed off after concluding that it would be difficult to compete against existing casinos.
But there are ways the company could get around that hurdle. For instance, the company could look to acquire an existing sports betting operator, which would allow it to quickly enter the market.
Supreme Court Ruling Critical
As with many gaming firms looking at the potential of the US sports betting market, Verizon’s plans hinge on a pending Supreme Court case. Justices are currently considering Christie vs. the NCAA, in which the state of New Jersey wants to overturn the Professional and Amateur Sports Protection Act (PASPA) and allow it to regulate sports betting.
If New Jersey is successful in court, each state would be allowed to choose if they wanted to regulate sports betting individually. At least 17 state legislatures have seen bills introduced to do just that, with some like Pennsylvania and Connecticut having already passed laws that will take effect should federal law change. The latest state to talk about regulation is West Virginia, which will consider a bill developed in consultation with the state lottery.
According to many legal experts, the odds are good that the Supreme Court will rule in New Jersey’s favor. Based on the oral arguments heard in December, the majority of justices seemed to question the validity of PASPA, suggesting the law could be struck down. A ruling is expected sometime this spring.
