As a proud Michigander, it hurts to even type this: But Ohio has handed my state another L.
And like its famous college football program, the Ohio sports betting market is the envy of a lot of states, not just us to the north.
The competition between operators will be fierce, the playing field will be level, and Ohio players will reap the benefits. State lawmakers even did a better job ensuring responsible gambling measures will be in place in Ohio.
You Buckeyes have shown the way with patience in the past and have provided for future flexibility down the road. I don’t compliment folks from Ohio very often, but your system is the best in the nation, plain and simple.
As for me, at least I was in the Big House on Nov. 27 for 42-27 to help ease the sting.
Staggering numbers expected from Ohio sports betting
The legal sports betting framework in Ohio paints a bright picture for the future of the industry in the state.
This is according to a PlayOhio analysis, performed by data specialist Eric Ramsey, an expert on policy and data in sports wagering in North America who has been widely cited by media outlets.
PlayOhio projects that a mature Buckeye State market could produce $9 billion to $12 billion in wagers, as much as $900 million in gaming revenue, and $90 million in state taxes annually. The high end of that range would represent larger numbers than any legal U.S. market generated in 2021.
To be clear, these numbers won’t put Ohio at the top of the U.S. heap. But at least in the short term, Ohio appears poised to emerge as the second- or third-largest sports betting market in the country.
It would sit clearly behind New York, but perhaps compete with Nevada, New Jersey, and Illinois for the silver medal.
But what this framework does is maximize Ohio’s earning potential for the market, tax revenue for the state and gives players every opportunity to get wins of their own.
Why is Ohio’s sports betting market the best?
The new law is all-inclusive, bringing together existing casino stakeholders, its professional sports teams and the state lottery program.
Highlights include:
- Competitive online environment: The availability of multiple online betting brands is the No. 1 indicator of success for other U.S. markets. If it follows the national trend, Ohio’s betting apps will ultimately account for more than 90% of the state’s total betting volume.
- Participation from existing stakeholders: Buy-in from a state’s land-based gambling industry is often key to passage for a sports betting bill, and that was the case here. The path to an agreeable framework was perhaps smoothed by the fact that most of its gaming enterprises also have broader, national ambitions.
- Minimal restrictions on markets: Policymakers took a permissive approach to the types of available wagers they’ll allow. A diverse betting menu is a key ingredient in the effort to maximize revenue by channeling existing bettors into the newly regulated marketplace.
- Moderate taxes and fees: The financial hurdles to entry are scaled in a way that is appropriate for the market and the operators that support it. By imposing modest costs on the industry, officials have put sports betting proprietors in a position to maximize both their own investments and the value they can offer to customers.
There are notably no college betting limitations in the Ohio law. Such restrictions, endorsed by the NCAA and present in at least 19 other U.S. jurisdictions, are misguided from a policy perspective and generally ineffective for their stated purpose.
Wagering is allowed on all professional and collegiate sports, as well as esports and the Olympics. The only events expressly prohibited for betting are those involving primary or secondary school students. Beyond that, the law gives the Ohio Casino Control Commission broad discretion over the wagers it chooses to allow in Ohio.
The conference committee also removed provisions that would have empowered sports leagues to request the exclusive use of their official data for settling certain types of wagers. Operators may instead use any approved source of data.
My favorite stipulation is one Michigan missed
Michigan’s highlight for its early days of online gambling has been the boom of the online casino industry. Michigan has set up the best framework for online casinos, and Ohio would be wise to follow down that path as soon as possible.
But for all Michigan has done for the industry, the state isn’t feeling the love outside of the required tax payments and a nice entertainment option for citizens. Read: The online gambling industry didn’t bring a lot of jobs here.
In Ohio, Type A proprietors are required to maintain a Type B sports gaming facility or other place of business in Ohio as a condition of their licensure.
For companies without an existing presence in the state, a secure data warehouse or some other tech/office space may suffice. There is no fixed limit on the number of brands (or “skins”) each Type A licensee may deploy into the marketplace, though there are limits on the number of supply contracts.
Every major operator in the country will seek licensure in Ohio, fostering the sort of competition that is essential to generating wagers in significant volume. It also means dozens of companies providing jobs in Ohio because the law basically requires them to do so.
Tax take should help offset Ohio problem gambling
I’m also jealous of Ohio’s responsible gambling measures. In Michigan, the law had fixed numbers ($500,000 each from sports betting and internet gaming) annually earmarked for responsible gambling prevention.
In Ohio, the state has earmarked 2% of the 10% state tax take to fight gambling addiction. That makes sense. The more Ohioans lose from sports betting, the more resources will be available.
PlayOhio estimates that could be $1.8 million — more than triple what Michigan takes from the sports betting market.
In addition to exclusion lists, the state is also training clinicians to deal specifically with sports betting addictions and are undergoing an educational campaign for the problem gambling hotline so residents don’t use the number for customer service issues as much.
Modest 10% tax rate will make Ohio attractive for business
A modest 10% tax rate and an allowance for some promotional deductions will enable these operators to offer pricing and bonuses that they may not be able to offer in more financially burdensome markets like New York. The inclusion of professional teams and sports venues in the Class B category will shore up the retail aspect in a way many markets neglect.
At maturity, Ohio’s sports betting product should boast one of the broadest rosters of operators in the nation. I’m excited to drive down Interstate 75 to Toledo and try them out after launch.
This framework provides a firm foundation for operators to build what should be one of the nation’s largest, most dynamic sports betting markets. The state’s sports landscape and the affinity for land-based gambling among its residents and visitors additionally bode well for the future of sports betting in Ohio.
This new sports betting policy is the best in the country, free from any significant flaws or limitations that could stifle Ohio’s industry.
As much as it pains me to admit it.
