How should we be thinking about sports gambling now?

Good morning, and thanks for spending part of your day with Extra Points.

Big day today. Let me share a quick announcement before getting to the newsletter.

Earlier this week, you might have noticed that Kyle Rowland, the lead writer for our sister publication, NIL Wire, accepted a new position at the University of Toledo. I’m bummed to lose Kyle, because he’s a friend of mine and I’ve really enjoyed working with him, but I love the hire for the Rockets. I’m confident he’ll do a great job in their sports information department.

We’ve been re-thinking where NIL Wire sits in our company for the last few months, as I think the editorial distinction between what our publications cover has become more and more blurred. Kyle’s departure makes me think this is a good time to try something different.

We’re going to merge NIL Wire into Extra Points and create one big publication, rather than operate two different ones. We believe this will create a better experience for our readers, and make it easier for us to pursue more relevant ad and sponsorship packages.

For all of you, that shouldn’t mean much of a change. Extra Points will continue to publish four-days-a-week, with two newsletters free, and two behind our $9/mo subscription paywall. If you have a paid subscription to both publications, we’ll merge your accounts and honor the lowest pricing (so you won’t be charged twice).

The only editorial tweak you’ll likely notice is that our free Friday post will be more focused on athlete-compensation and money related stories, and be a more aggregation-centric, rather than a full column. Kyle’s reported columns on NIL Wire will also be migrating over to Extra Points, and EP premium subscribers will be able to access them.

The migration process will start today, and NIL Wire subscribers should get their first edition of Extra Points on Friday. If any of you have any additional questions, feel free to drop me a line at [email protected]. Again, shouldn’t be a big change for EP readers, but also didn’t want it to be a surprise!

To me, the biggest news of the week, far bigger than even the expansion of the NCAA basketball tournaments, is the Brendan Sorsby gambling scandal.

For those that need a quick tl;dr, Sorsby was one of the most highly sought-after transfer quarterbacks of the last cycle, leaving Cincinnati to join a Texas Tech squad with national title aspirations. ESPN previously reported Sorsby was slated to make in the neighborhood of $5 million this year, one of, if not the, highest player salaries in college football.

But prior to joining the Bearcats, Sorsby reportedly bet on Indiana football games while he was a member of the team (only on the Hoosiers to win, and never in a game where he actually played), Beyond college football, Sorsby also reportedly regularly bet on Cincinnati Reds games and other professional sports, activities that would be against NCAA regulations. Earlier this week, Texas Tech announced that Sorsby is entering a “residential treatment program for a gambling addiction.”

There are a ton of angles to this story. There’s the potential recruiting skullduggery storyline between Cincinnati and Texas Tech. Who knew what and when? Is Cincinnati at risk of NCAA punishment for playing an athlete who was breaking NCAA bylaws? Who let the NCAA know about the activity?

Then there’s the on-field angle. According to the proverbial letter of the law here, Sorsby isn’t just at risk for a major suspension, but potentially a lifetime ban from college football. Will he play this season, or head to the NFL? Would Texas Tech risk additional punishments by pursuing an additional transfer? Can they still make the CFP without Sorsby?

And there’s an important legal angle. Cincinnati is suing over a buyout provision that was apparently not paid when Sorsby transferred to Texas Tech. Beyond an important legal test of the enforceability of said player contracts, Sorsby’s lawyers attack the very idea that these player compensation contracts are marketing deals, rather than what virtually everybody else recognizes but can’t write in a formal document: these are pay-for-play contracts for athletic performance, not publicity rights.

There’s plenty of time to write about all of those. But here, I want to do something a little different. I’d like to talk through how this story could, or perhaps should, change our thinking about sports gambling in the United States.

This isn’t the first major sports gambling story in a post-mass legalization world. Shoot, Damon Jones just plead guilty for his role in an NBA scandal, and dozens of college athletes were implicated in manipulating performance for the benefit of gamblers last season.

My pal Alex Kirshner, over at Slate, argues that a takeaway from this story should be that American society needs more friction around sports betting. Via his story:

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The sports betting industry has a way of painting every busted athlete as a success story for legalized gambling. The sportsbooks would argue that the player only got caught because of the highly mechanized, public nature of the betting market. This argument is both correct and disingenuous; the player wouldn’t have been caught if he were betting with a private bookie, but he also may not have been betting at all if he needed to find his own private market maker. Reasonable people will go in circles forever about whether specific cases are proof of the industry’s maturity or proof of its corrupting effect. Sorsby’s case is an unambiguous black mark for the entire enterprise of legal sports betting, though. Before computerized and heavily advertised online sports betting, it was not possible for a random college student to place mountains of small bets on individual events within a ballgame

Kirshner believes that part of the issue, with Sorsby or anybody else, is that it’s just too dang easy to bet from your phone. That lack of friction, plus the constant advertising from sportsbooks and the dopamine rush of winning a few bucks, leads to problems.

Is he right? Well, walk with me here for a second. I don’t have a completely formed thesis yet, but I’d be very interested in your thoughts as I try to nail down why there may be some problems here, and what we (as fans and industry professionals) could do about it.

Assumption #1: gambling has potential negative societal consequences to require some sort of regulation and/or social stigma…but outright banning is unlikely to be effective

Gambling is not a new industry…casting lots or games of chance predate the life of Christ, after all. Plenty of other societies, current and historic, have viewed the practice as some sort of social ill, even though gambling continued to happen.

I am operating on the assumption that gambling has enough potential societal negatives, be that addiction risk, a drain on family finances, connection to crime, mental health challenges, etc, that it should not be permitted without any sort of regulation or constraint. But I am also operating on the assumption that outright and total prohibition is unlikely to be successful, just as our country has learned from experiments in banning alcohol, some drugs, and other vices.

Perhaps you disagree! That’s okay! I’m open to other arguments.

But if we start at “okay, we can’t get rid of this thing, but we want some sort of constraining principles to limit the potential social harms”, then the question becomes…what regulations?