Episode 27

Shane Mercer [00:00:00]:

How do you kind of look at the current regulation landscape across the continent?

Brett Abarbanel [00:00:06]:

How long is your podcast?

Shane Mercer [00:00:08]:

Yeah. Hello and welcome back to another episode of Behind the Lines, the only podcast out there purifying the sports betting industry. I'm your host, Shane Mercer. That guy over there, Andrew Pace, the founder of inplayLIVE, only one of the greatest sports betting communities on planet Earth. And we have got quite a show lined up for you with a very special guest. This show is all about educating you, the better, the average recreational bettor, or the professional sports bettor. And today we have just the person to do it. It's a professor. Funny how that works out, eh? She is incredible with the University of Nevada's Las Vegas Gaming Institute. And it is a really, really interesting conversation, so stick around for that. But first we're going to bring you some news and notes. And before we do that, I'm going to remind you all to like download, subscribe, follow us on all the socials at inplayLIVE. And if you want to be a part of the conversation or you got a sports betting story you want to share, please tag us in the comments below. We will follow up with you. We'll be happy to share your story here on the podcast or even bring you on the show, potentially. All right, so, Pace, with that out of the way, we've got quite a few moves happenings taking place in the sports betting landscape. Let's start with one of the bigger ones that I think we've seen probably this year. So let's recap. Barstool was sold or bought by Penn Entertainment. Now Penn Entertainment has essentially sold the brand back to David Portnoy and with a non compete clause. And now they've reached this $2 billion deal with ESPN. It's one and a half billion dollars in cash with another $500 million in stock options for ESPN to buy shares of Penn Entertainment. And ESPN is launching ESPN Bet in the fall. What a deal. What an sort of incredible advancement in this landscape to have probably the biggest sports broadcaster in the world now also be a sports book.

Andrew Pace [00:02:28]:

Wild stuff, man. Absolutely wild stuff. It's interesting because we brought up Dave Portnoy now on like five different episodes I feel. You know, we were just talking about the benefit potentially of the Kambi lines no longer being available to certain states so that they now have access to the score lines because of the change that had sort of undergone. And then obviously the insider stuff relating to red tape in the industry and licenses being denied and things like that, which obviously gets into some of the discussion that we're going to get in today as it relates to regulation. Yeah. And know incomes. Disney, right? Disney to the rescue. And when you package it all together and we've talked about advertising and kids being parents and children being upset that their kid feels like they need to use Bet MGM because Connor McDavid is telling them to bet with Wayne Gretzky on one of the ads. And obviously the regulation that we've seen ensued from that in Ontario with some of the advertising laws that have changed and are changing. And then you take Disney, like Disney is the company of the know and getting in major into the sports betting world and trying to compete in that space. I mean, I think there's a natural fit to a certain extent from the standpoint of being a major sports broadcaster and picking up on this trend. They are a little late to the party, but I say better late than never, especially as a sports bettor that now has a major player coming in to compete against the DraftKings and Bet365's of the world. So from that standpoint, I'm always excited, I'm always intrigued, but we just saw Fox Bet fold up, pack up shop and call it a day. And Fox Bet would be Fox major broadcasting company, much like ESPN in the world of sports. Obviously not the same company, but yeah, they're going to shoot their shot. And obviously Fanatics a big player now as well, that they create jerseys and apparel for the sports industry as a whole that goes, hey, we want a piece of this sports betting pie. As you know, you got some books closing down, you got other books opening up. And I always try to look at everything from the most positive perspective possible. ESPN, they're not going to be using the score lines. They are going to be using the score lines. The scorelines aren't offering very many markets. They got a whole bunch of work to do to compete. Who are they going to use for their lines? Provider Barstool was using Kambi. Do they go back to Kambi? Probably not. Are they going to acquire an odds company like DraftKings did buying SB Tech? There are some that are available for purchase that have very much been looked at. Fanatics bought I can't remember the name of the company, but the ODS provider that was providing lines for Fox Bet. So it's all very in tandem with this sort of storyline. And I go, hey, look at what DraftKings did when they became serious and bought SB Tech. If you're giving me another player at that level, I'm very excited to see what they offer and what kind of lines we can get with them.

Shane Mercer [00:05:49]:

In your reaction there, you also brought up the fact that we're always seeing sports books closing up shop while other ones open. Well, we also have another big news story to sort of unpack here, and that is Wynn bet shutting down in Arizona, Colorado, Indiana, Louisiana, New Jersey, Tennessee, Virginia, and West Virginia. It will still continue to operate in Nevada and Massachusetts. While it's New York and Michigan, the standing in those states is still under review. So you might still be able to get Wynn Bet in New York and Michigan. It is still in Nevada and Massachusetts, but just about everywhere else in the US. It is now gone. The company saying that the decision was driven by demands for marketing spend to acquire sports betting customers. So essentially it sounds like it just couldn't keep up with FanDuel DraftKings and the other big sports books of the world, right?

Andrew Pace [00:06:54]:

Yeah, that's an interesting take on it. I think that honestly, there's just some things touched on in our interview that make this conversation much more relevant. So I'd love to comment on the Wynn Bet and the Fox Bet closures as it relates to some of those topics.

Shane Mercer [00:07:10]:

All right, well, we will talk about more of the sports betting landscape on the other side of this interview. But first, let me just tee it up. So dr. Brett Abarbanel. Super fascinating individual. She's the executive director of the International Gaming Institute out of University of Nevada, Las Vegas. All she does is think about sports betting, gambling, igaming and she really looks at this intersection between online gaming. So just think of know your Candy Crushes of the world, know a battle royale or whatever other silly games you might have played on your phone. I'm probably dating myself with some of those references because I don't play a lot of these games, and I'm sure there's some really cool new ones out there, but if you've ever played those, you probably know about how. Hey, if you spend so much money, you can get so many crystals to spend on, I don't know, weapons or something like that, to then go and defeat other people. And there's this whole element to it that does involve a certain element of gambling in this gaming world. But her and I, we sat down, we chatted more about the sports betting realm, which she also has a vast wealth of knowledge in. And so why don't we play that for you now. Dr. Bret Abarbanel, executive Director, the University of Nevada, Las Vegas International Gaming Institute. Thanks so much for coming on the show. Really happy to have you.

Brett Abarbanel [00:08:37]:

Thanks so much, Shane. It's really wonderful to be here with you.

Shane Mercer [00:08:40]:

Well, it's great to have you on. And I want to just start off with this whole idea of responsible gambling. A lot of people say gambling is irresponsible by nature. What does responsible gambling mean to you?

Brett Abarbanel [00:08:53]:

Well, first, I wouldn't say gambling is irresponsible by nature. I'd say it's risky by nature, which doesn't necessitate irresponsibility. Right. People take risks in everything that they do. So when we talk about responsible gambling, I always say, okay, you know what? Let's talk about gambling as a whole, because how can you be responsible in something if we don't actually know what you're being responsible in? So the spiel that I always give and it's interactive, so you get to play along. Shane, congratulations for volunteering is to pose this. What do you Shane, what do you think of when you think of the word gambling?

Shane Mercer [00:09:29]:

Oh, well, I think know people playing games where there's a certain, I guess, advantage that works against them. So that playing a game where the house has an advantage over you and you know that you're probably going to lose money over a certain amount of time.

Brett Abarbanel [00:09:52]:

I love that you've gone for this really academic answer. You've worked really hard to have like a textbook type response to what I've said as most of the time someone will be like, oh, like a slot machine. But you've gone for this very detailed and thorough and sought out response, which I really appreciate. Right. So some people do say like slots. Maybe someone will say, oh, the poker game I play in on Friday nights, right. Sometimes people will come up with something else. Right. So the sports that you bet on, how often do you see them flip a coin at the beginning of the game? Yeah, well, all football games, is that gambling? Did you think of times maybe when you were playing a board game against somebody and the stakes had gotten really high and maybe it wasn't monetary stakes. Right. But like pride at winning and then you had to roll a die for your turn.

Shane Mercer [00:10:40]:

That happens all the time in my house with my kids.

Brett Abarbanel [00:10:42]:

Yeah, and the kids always win. Right.

Shane Mercer [00:10:45]:

I play to win.

Brett Abarbanel [00:10:48]:

You play to win. So the kids do always win then. Or my favorite kind of joke response that I get whenever I ask this question is marriage. It's a gamble. Right. So sort of at its base, gambling is this idea that you're risking something of value on an outcome that's uncertain. And when we think about it that way, almost all of our familiar activities use elements of gambling. Right. When you get into your car at the beginning of the day and commute to work, or if I'm at home right now. But let's say I had decided to do this podcast from a coffee shop, I'd be gambling on the strength of the WiFi while I'm here chatting with you. All sorts of things are things that we take risks on these days. If you get on a plane and fly through New England, you're gambling on the weather, not having a ground stop. So there's all sorts of different things in our life that really are gambling in that sense. Right. Risking something of value on an outcome that's uncertain. But we all think about gambling differently, right. You've described it in a way that's different from the way a lot of other people describe it. You think about it differently than I think about it. Right. And largely that's because we think about gambling differently because we don't see things as they are, we see them as we are. This is something that expands way beyond the scope of gambling. But it's how I like to think about the way that we all approach different risk taking. So when it comes to responsible gambling, then the idea of responsible gambling is this concept that you're doing that gambling, you're doing that risk taking in a way that works for you. It's not going to move you beyond if you're doing gambling in a monetary sense, it's not going to move you beyond your bankroll or what your wallet can handle. It's in a mental health sense. It's not doing risk taking in a way that's going to move you beyond something that you feel so uncomfortable doing that it's going to perhaps tear you apart. It won't ruin your life to be making these wagers or taking these risks. So when we think about it really broadly in terms of responsible gambling, that's the broader way of thinking about it. The term responsible gambling in some ways is a little bit silly because it's not necessarily reflective of what it actually should mean. The term itself comes from responsible drinking. That term was around, I believe, this term, at least in North America, generated from the American Gaming Association, looking around and saying, okay, how do we put a word to this thing? And we say, oh, you know what? We're telling people to drink responsibly. Let's tell them to gamble responsibly too. And the term has been through shifts. Responsible gambling is not just a kind of generic term. If you look to the UK. For example, the term has very already, very quickly, widely switched over to something called safer gambling, which in itself is pretty self explanatory, but also completely changes the way we might approach this. Responsible gambling has been accused of kind of sounding like only the individual can make that choice. The individual is the one that is responsible for what's happening to them, whereas safer gambling almost flips that on its head in sort of a sense of, well, we have to protect people from whatever they're doing while they're gambling, so we have to make it safer for them and all of that. The onus of that responsibility moves away from individuals and fully on to the person or organization who's offering that gamble. So this is where you very quickly learned, Shane, that when you ask long winded professor what they think about a certain term, you will get an equally long winded answer because of simply who we are. Again, even just answering questions. If you don't see it as it is, you see it as you are.

Shane Mercer [00:14:48]:

Right. Very interesting. And I'm used to long winded answers from professors. I interview a lot of people. We're all good there. And I'm glad because it gives us more to talk about too, because there's a lot to dig into there. So this idea then I want to get at this idea then of safer gambling, responsible gambling, however you want to term it, and shifting the onus what onus does a sports book or an operator have?

Brett Abarbanel [00:15:12]:

That's such a good question, because this is the next favorite thing that everybody has regarding academics, which is our favorite answer is, it depends, of course.

Shane Mercer [00:15:24]:

A nice gray answer. Yeah.

Brett Abarbanel [00:15:26]:

Oh, it is. It's perfect. We love it. We love that one. I grew up with one of my parents, was a professor, and so that was just a constant. It depends. What do you think? Right, right. But it is it does depend. It depends on who you are. It depends on where the book is. It depends where you are around the world, because different cultures and communities have different views on what responsibility might entail. We actually did a study a few years back that was called who's Responsible for Responsible Gambling? And if you look at North Americans, almost exclusively because you guys are based in Vancouver, right?

Shane Mercer [00:16:03]:

We're in Canada. Yeah. inplayLIVE is based out Vancouver. You know, it has community members across North America.

Brett Abarbanel [00:16:12]:

Okay, so across North America. Perfect. I'll stick with North America then. I didn't want to accidentally get the place wrong. That's one of my least favorite faux PA. So in North America, then, the responsibility was vastly, vastly, vastly placed on the gambler themselves. It didn't get rid of the view that there's responsibility due to the sports book or to the casino. It didn't get rid of the idea that there's responsibility that may be due to, say, the government who theoretically exists to protect its consumers. And I say theoretically only because I know many, many people have different views on what government duties are and should be. So I won't delve too deeply into that. But a lot of this also comes down to great once we kind of figure out who holds some of that responsibility. What does that responsibility entail? Because for a long time, responsible gambling was such a basic thing, right? It was so compliance based, the regulatory agencies would say, okay, you need to show us that you have some sort of responsible gambling program, and we would, like, slap a helpline on an advertisement and say, look how amazing this is. Here is our responsible gambling program. If you have a problem, you can call it, and somebody will help you. And I don't want to completely undermine helplines because they help. That's indeed the goal. When you call those numbers, there are people on the other line who are incredible and who indeed will help you. But it's not something that can be so completely inclusive as to prevent problem gambling. Right. And the idea of responsible gambling is the idea of prevention. You're offering the tools that somebody might need to gamble responsibly. Another term that might be used is gamble healthily. Gamble. Normally, which sounds like a strange term, but that really actually is, when you think about it, kind of in psychology speak, it's simply a scientific term. So there's a lot of these things that come into play. And I also want to emphasize when I say tools, I don't just mean like a self exclusion tool that exists whether physically or digitally or what have you on an app or a website. It might just be a tool that you generate for yourself. Let's say you have for many years and this is sort of more the sports betting term. Have your own bankroll, right? You keep track of everything that you do. That's responsible gambling. We just don't put a label on it because it's not something necessarily that's come up or necessarily has the need to throw all over an advertisement. And this is continually evolving just to kind of come a little bit full circle here on the language concept, which is we don't have a silver bullet, we don't have an exact answer. There's still a lot of learning that's getting done not just by gamblers, but also by academics, by public health organizations, by regulatory agencies that often now are updating regs to start including responsible gambling practices in them. It's not something that will be a one and done. It's something that has to continually evolve because we're constantly learning more and more about it. I have a great example of how this massively failed. Oh, I have two great examples of how this massively failed even. And since we're here, you're going to hear both of them and if you're going to cut out some of them later, that's totally okay. So the first one is it's a North American example. Oops, we didn't think about that. Which is in limit setting. Right? I know. This is something that comes up all the time. We talk about it all the time in our world. I know you guys have talked about it on this podcast because I pulled it up and prepared by listening to these. So one of the interesting things that happened was when poker was first legalized in Nevada and we first started seeing some of these sites crop up and one of the things that was required was to be able to offer some of these limit setting tools. And of course, one of these limit setting tools is how much do you want to bet in a given day? Now, the problem was someone could get way through a hand. So let's say you're playing Texas Holdum and you get to the turn and you max out your maximum wagers for the day your limit hits, and then you're suddenly locked out of betting on the river. But that may actually then force you to be unoptimally playing because betting on the river would have been the better, safer, more responsible choice given what the EV was. I haven't given an exact example for whatever cards are out on the table or what your hand is, but that had happened a couple of times. And so what was interesting to see were the operator saying, okay, well, you forced us to make this available. So we've made it available, and then they got the failures and brought it back before the gaming control board and had that updated to make sure that we didn't have more of these unintended consequences in the future. The next example is of unintended consequences and accidental errors is a more cultural example. When casinos first opened to locals in south korea, because for a long time, they were only open to tourists and non locals or non residents, rather. One of the things that they wanted to do. Again, how do we make sure that we are minimizing problem gambling? What sort of things should we offer? And so they came to a place that had a long history of coming up with these sorts of ideas, and that was las vegas in the state of nevada. We've had legalized gambling in casinos since 1931. And so we've been through kind of a few different roller coasters of experiments and things that didn't didn't work. And so, of course, the big genius solution was, you know what's really great is if you put a free helpline everywhere, and you plaster that number all over the place and you make sure that anybody who needs help can get it immediately, put that number everywhere. So they spent this was probably early to mid 2000s, they spent over a million dollars us putting this thing into place. And it was a huge failure. Nobody called it because unlike in, say, north america, where we're loud and we like to share things, we like to overshare things, it's very different in korean culture. You're very, very protective of things that might give away personal and private information about you, about your family. If you call this number, you don't know who's on the other end of the line, and they might share this, and it might be incredibly embarrassing for this sort of information to come out so immediately the number had to be completely reworked. It still does exist, but in a very, very different format today regarding privacy protections and the information around that. But it's one of those examples of when I say it depends who you are, where you are. What does this term mean? Because for every person, every community, every culture around the world will have a different approach and different needs with regards to just even something as simple, if you will, as responsible gambling practices.

Shane Mercer [00:23:46]:

Okay, I want to ask you then, because I think when you brought up the term limiting, you were sort of referring to the idea of the player imposing their own limits on themselves. Yes, but what about the practice of limiting where the sports book limits winners? What are your thoughts on that? Should winners be allowed to play?

Brett Abarbanel [00:24:11]:

So we've totally changed direction then, is what you're telling me.

Shane Mercer [00:24:15]:

You brought up the term limiting and you referenced our podcast, and when it comes to our show and our audience. It's the practice that it's the practice of the sports books limiting winners that we often discuss.

Brett Abarbanel [00:24:30]:

Yeah, no, I think I appreciate the segue and I certainly recognize it. Don't let me totally mock you there. Well, it's an interesting business practice and it's one that has existed for a while and it's taken on a number of different forms and now we're starting to see it. What feels like was more frequency and probably for multiple reasons. One of them is that now that we can do this sort of thing digitally, we can do it at scale and so we're seeing a higher volume of this sort of thing happening. We also have, thanks to our digital world, a much more easily accessible communications platform. So it's also getting talked about more broadly and networked more broadly. And it's the sort of thing that I've always found very frustrating. I understand why from a business perspective that this exists. I understand it not just in terms of a goal of not losing money, but also in terms of how a general betting market needs to exist with regards to ensuring a book can make money, because books work on pretty thin margins and so I find it understandable what they do. Though I have to say I've always found it an incredibly frustrating practice because I think that it just angers customers. It's not the sort of thing that typically brings in a crowd, right. If you know that you're going to have issues placing wagers. I think it also causes issues when it comes to the big argument that continues to go on in the industry regarding trying to get rid of illegal operators, because illegal operators are doing this, at least as is reported, at a much lower rate. You don't see a lot of people complaining about getting limited on huge international and offshore, I'll say operators, whereas we keep seeing it on and on and on and again here in North America. So I think it's an incredibly frustrating thing. You're not going to get the same sort of anger out of me as I'm sure we're getting out of a lot of different sports bettors because I try very hard to approach this from all the different angles, but I can certainly speak to the very clear and understandable anger that comes up when this is something that you do, whether it's casually or for a living. I know plenty of professional sports bettors who suddenly find themselves getting hamstrung because they're not able to do what they want, which is bet on a legal site, a licensed site, at the levels that they would like to wager in order to maintain their own state of living.

Shane Mercer [00:27:04]:

And I appreciate your academic objectivity to the conversation here, but I guess it sort of gets to this fact, this idea actually, that the sports books sort of try to promote, or at least the ones that engage in the practice of limiting we tend to call them soft books that engage in this practice of limiting. They also promote this message that sports betting is just for entertainment. You're not here to make money. You shouldn't be coming to us with the idea that you're going to make money over the long term. But is this like a type of conditioning, conditioning the customer to prepare to lose?

Brett Abarbanel [00:27:45]:

In a way, yes. Whenever I hear these sorts of things, it feels to me like the combination of 20 different voices coming to a marketing department saying, hey, make sure you include this perspective as well. So, for example, as like a single voice, right, the marketing department and this is going to be a real example, but I just won't name names, but it's Googleable where a marketing department put up an ad on Twitter basically saying, this is a shoe in. Go bet your child's college fund. And everyone at the time I happened to know one of the people who worked in that same company's responsible gambling department, and I sent him a text and sent him the link and there was a very immediate oh, shit moment going on there. And I don't follow up and say, oh, tell me exactly what happened. But they definitely retracted it, pulled it back. And to my understanding, the person who had been working in marketing and had posted this did not even realize what the potential ramifications that could be for the message that was being sent out to the public. At the same time, you're probably getting voices coming in from, say, government relations where there are people who've stood before gaming control boards saying everything is great, don't worry, we're not saying free bet anymore because you've told us that. That clearly is not correct because in the end it's not really free, you have to play through or we're not offering other language that has been identified as particularly offensive, something like that. And then they are also showing up in the marketing department saying, hey, we need to be more honest. We're being told we can't tell everybody that you're going to win every time, which frankly they shouldn't. Right. That's not a guarantee that a gambling company can make. And so let's make sure that we're setting the level and making sure that people better understand what might be going on. So in that sense, yes, I think there's a bit of expectation setting going on, but at the same time, it is a business. They want to be able to make it appealing to people while also trying to be honest about in the end. Right. If we go back to the beginning here, that somebody who places a bet on their site is risking something of value on an outcome that's uncertain and that's again, the generic term. Right. I know that when we talk about sports betting, it gets a little different. It's not the same thing as pushing a button on a. Slot machine. There is an element of analysis that goes into this sort of thing. You can make educated bets, right, in the way that you can't necessarily make an educated bet when you're just pushing a button on reels on a slot. And so those things come into play too. But in the end again, I apologize, I've diverted a little bit here. But in the end, when we think about what do all these things mean, a lot of that is kind of trying to tie into setting realistic expectations, whether that's for the business itself or because it's something that builds into the compliance needs for whatever jurisdiction holds their license or wherever they hold the license with a jurisdiction.

Shane Mercer [00:31:09]:

So let's talk about that then and the current landscape of regulation in North America. How would you describe it? I mean, I would call it a sort know patchwork in development. But how do you kind of look at the current regulation landscape across the continent?

Brett Abarbanel [00:31:28]:

How long is your podcast?

Shane Mercer [00:31:30]:

Yeah.

Brett Abarbanel [00:31:35]:

Well, it's a patchwork, right? It goes back to kind of the history of gambling in the United States. And this very much is a state's rights issue. This is how everything was decided in a very simplistic manner. This is how everything was decided in the end in the US. With regard to PASPA being overturned and how each state can go about doing that. And then, of course, in Canada as well, it's provincially regulated. There are some federal level rules and regulations that cover this entire concept. But more broadly, this is a state level concept and that's how it has been growing. It's been largely a matter of that of protecting states rights. And so each state has been able to make its own choices on how it wants to proceed. With sports betting, this ends up getting confusing. Of course, each individual state has its own something going on. They have whatever particular interest needs to be promoted. Some states are not so concerned, but very concerned about being the first to do X. And so they'll work very, very hard to ensure a specific element is included in their state. And all of it, then it is patchwork is a great way to describe it. And there's pros and cons to having it in this manner.

Shane Mercer [00:32:52]:

I want to ask you, are there any jurisdictions that you see out there that are doing it right or doing it in a way that you think creates a level playing field, a fair playing field?

Brett Abarbanel [00:33:05]:

What do you mean by fair playing field? For whom is it fair?

Shane Mercer [00:33:12]:

That it's fair for both operator and I'll say operator with the term soft book in mind because I think when we get to Sharp books, it's a different kind of a ballgame. And I think a lot of the Sharp books are already sort of on a path to a fair playing field, but fair for both the soft book that wants to turn a profit with their very thin margins, but also fair for the customer who's using the book.

Brett Abarbanel [00:33:40]:

It's hard to say because it's sort of like asking me to pick favorites. It's always a tough thing for me to do, right? When you're an academic, you're meant to be playing this fairly and I don't think there's any jurisdiction who's doing things perfectly. Right. Every jurisdiction will always have things somewhat unusual in their own way. I would say that those that might be doing it best would really be the ones that are doing something dynamically rather than statically because there's never really going to be a best that lasts forever. We're always going to be evolving. And a lot of that ties into that same digital space that we talked about before. We can't necessarily say, yes, this is good, this is good, stop. We're good for the rest of time. And so to have regulations or even to have laws that allow for dynamic change as we know more as certain things become clear, right. Some of these unintended consequences that I talked about in the past, if we're able to recognize when those are happening and then update rules and regulations to accommodate for that, that would be a best practice rather than any that would be my answer. More so than any specific jurisdiction that I think is doing things really well.

Shane Mercer [00:34:54]:

Who should have more influence?

Brett Abarbanel [00:34:58]:

In the end? I mean the regulator, right? They're the ones determining or are you talking about influence on the regular?

Shane Mercer [00:35:01]:

Who should have on the regulator. Exactly.

Brett Abarbanel [00:35:07]:

That is a very fun it depends question too, because often that's something that is dictated by whatever laws have created that regulator, the goals for that regulator. So for example, you'll hear Tim Miller, who's the executive director of the gambling commission in Great Britain, you'll hear him talk about how based on the goals of his commission, he wants Britain to be the safest place in the world to gamble. Now, we don't have to talk about what that phrase means because I've talked about it with him and I still don't understand what exactly he means by that. But that is a good example of kind of what a regulator's goal might be. And then because of that, they might weight, I won't want to say value, but they might weight the opinions of certain entities more. Right. If you're in a jurisdiction where business is a particularly important thing, right, they want a business to be successful and therefore generate tax dollars to support that jurisdiction. They may place a higher weight on what the operator wants. If you're in a jurisdiction that has a heavy focused on, say, consumer protection and fairness for consumers, they will almost definitely be weighing more of what consumer feedback would be.

Shane Mercer [00:36:18]:

I guess my thought would be, shouldn't the regulator that is a function typically of a government, a state government in the US. Here in Canada, a provincial government it's usually a government agency. Shouldn't it put greater weight on the needs and desires of the consumer?

Brett Abarbanel [00:36:41]:

It's not a universal thing, like I said, right? Because maybe it's not always the consumer. That's necessarily the most important part of what that regulatory organization is doing. Like I said, in some cases it is, right? They want the consumer to be at the forefront of this. They are the most valuable kind of stakeholder within this discussion. But for others it's more about broader needs for their jurisdiction. And usually broader needs means the need for more tax dollars, which means they're going to look to ways to ensure that there's a thriving business, to ensure that there are more tax dollars. Now, thriving business can mean many things. It doesn't necessarily mean protecting the businesses of that jurisdiction. It may also mean making sure that the businesses have a sustainable business which requires happy customers. And so all of these things tend to come into play. I think that you're definitely coming at this from your perspective, right? We don't see things as they are necessarily. We see them as we are. And I totally get that, right? When I put on my bettor hat, I'm always like, this is crap. What on earth is happening over here? And when I put on my broader business thinking cap, I try to think more about what these are. And when I put on my academic cap, I have to say, all right, everybody has a say. But I think that that's important because all of these even in places where, to use your example right, about the consumer, even in places where there might be a heavier emphasis on, say, generating tax dollars, that doesn't mean the consumer doesn't have a voice. But it may mean that you need to be in a place where you're making that voice more heard. So whether that's something like showing up at board meetings, those are typically posted online and people can show up these days they're streamed. You can log in and watch them or listening to them. And I believe, and I don't think I'm going to exclude anybody in this, every single state and province or provincial public meeting requires public notice and allows for public statement. So if you want to go there and do that, I would definitely encourage that. But I want to emphasize that.

Brett Abarbanel [00:38:52]:

Just because we, when we put on our various hats, think that we are the most important and I know exactly what you are feeling because I have definitely felt that exact thing. Unfortunately, it's just not always the way that the business or the regulator is going to be viewing the priority of stakeholders within their jurisdiction.

Shane Mercer [00:39:12]:

Dr. Brett Abarbanel, executive Director, the University of Nevada Las Vegas International Gaming Institute. What a great conversation. I would love to have you back on again because I think there is so much more that we can dig into that, know, expand far beyond one podcast episode.

Brett Abarbanel [00:39:31]:

Well, thank you Shane.

Shane Mercer [00:39:34]:

Have yourself a great day. Thanks so much.

Brett Abarbanel [00:39:36]:

You too.

Shane Mercer [00:39:37]:

All right, Pace. So that was Dr. Brett Abarbanel, a really colorful character to say the least, but what a fascinating conversation. I really enjoyed it. But what did you think of what she had to say?

Andrew Pace [00:39:48]:

Well, I mean I was kind of picturing her as a professor and I'm in university and I'm thinking to myself like, if compared to some of the professors that I had she would have been an entertaining person to listen to if I was for some reason taking a course from her. So definitely entertaining. She obviously is knowledgeable on the topic. I mean you devote your career and your life to something, you're going to have obviously a whole bunch of different angles to listen to. And for me personally, I'm always of the mindset that if I am representing the gambler, the consumer, however you want to say it, whether that's a losing player that I can educate to improve, that I can offer tools. To that I believe to be real, responsible gaming tools. As opposed to what we've touched on before, what the books offer, which I don't believe to be real, responsible gaming tools. And if I want to influence regulators in any capacity, the different stakeholders in their opinions are extremely important to not only be able to understand, but to actually agree with in a number of different contexts in order to provide perspective that evens the playing field from the standpoint of saying, like, you're right, I'm wrong. That's a terrible way to debate someone or to get any productive change done, but rather saying, I can appreciate that these are the angles that you obviously are coming from with respect to regulation, with respect to limiting winners, with respect to the whole landscape. And this is why we believe that those steps are important going forward and how we believe they could be better handled to actually sort of round things out a little bit. And at the same time I feel like she very much is neutral. She recognizes that there are different perspectives based on different situations and each stakeholder in those situations sort of has their own validity with respect to the whole discussion. So yeah, great to have that perspective on. I would love to be on with her to challenge her on a few things and see where she comes back at us with, but yeah, great to hear from that perspective.

Shane Mercer [00:41:54]:

Yeah, I would absolutely love to have her back on the show. She does do a very great job at just sitting right on the fence without necessarily taking one side or the other which as an academic at an institution like that you kind of have to do that right to a certain extent. And she's in Las Vegas as well, right sort of gambling mecca of the world. So she's right in the middle of it all the time and is constantly engaged in those conversations and those debates. So you know, she does sort of come at it from this sort of holistic point of view. But I do think that there's probably a certain aspect where you have to stop and ask yourself, well hold on, wait a minute though. Shouldn't there be protections for the customer? Shouldn't that customer protection kind of trump profits?

Andrew Pace [00:42:46]:

Yeah, I think psychologically speaking, there's definitely some overlaps with sort of that side of things that she brought up that I wouldn't say I don't agree with. I would say I would just challenge like right out of the gate. She asked you what your definition of gambling was. For me, gambling is engaging in behavior that is going to lose you money over time. And she talked about different stakes beyond monetary ones. Typically speaking, when you refer to gambling, you are referring to putting up some sort of it doesn't have to be monetary, but putting up some sort of risk or item that actually implies that you will lose over the course of time. Gambling, the G word as we say, it does have a negative connotation to it. So when you bring up risk, there's always a conversation of risk versus reward. When you look at the investing landscape and you go, okay, I want to put money away for a certain period of time, but I'm really not comfortable with the swings of the stock market. What are my options? Money market funds and GICs and savings accounts and all these other sort of things that actually have guarantees. So what is the risk that you're taking? Well, it's opportunity cost associated with what you could have been doing with your money. It's whether or not you're going to beat inflation. There's a huge risk associated with whether the buying power of your money isn't going to be able to buy that same amount once you actually pull that money out of the investment, even though it did all remain intact and grow. And then obviously getting into purchasing of stocks where if the company doesn't do well, you don't do well. And the list goes on and on into things like commodities and art potentially really high risk things, cryptocurrencies, all these sort of things. But I think there's a fundamental difference between the word gambling and the word investing. Every single day when we walk outside you're taking risk. Risk that you don't get hit by a car, you get in a car. It's not a safe form of travel relative to other form of travels. I don't believe that to be gambling because that doesn't produce a net loss over time. But that doesn't mean you aren't taking risk. Investing is where you're taking risk with the intent of making money over the long term. Gambling you take a risk and is your intention to win? Yes, but I believe that fundamental difference is that investing you will in theory, make money over time or gambling, in theory, you will lose money over time. And actually, her making that comparison reminded me of our advertising episode, Shane, where we brought up the fan duel ad and the FanDuel ad tried to gamify or gamble FY, for lack of a better term, your life, where you're betting on that the bag didn't rip. And what's different with that fan duel ad and the actual reality is I have been out with buddies where you handicap live events in your life. We've handicapped at Super Bowl parties. What the next commercial will be if the first person shown in the commercial will be male or female, what type of ad it will be what the ODS are for certain circumstances on a golf course that you live handicap, I bet you you won't get out of the sand here. I bet you will or will not make that putt right. So that would all technically, I think, go under the umbrella of gambling. But in order for it to be gambling, in my opinion, you have to put up some sort of potential win or loss in that circumstance. And hopefully a lot of the situations that I just described would be more fair wagers because there is no vig. It's you and a buddy making a bet that hopefully you're not trying to hose your buddy on. Hopefully you're not that kind of person. You're actually just trying to make a fair wager between two people from the standpoint of excitement and entertainment. Where the losing over time comes in, obviously, is games and systems with some sort of vig and cut that the house is going to take over time that statistically makes those wagers be ones that profit the house over that course of the time and lose you money. But of course, that definition, she would be like, oh, well, that lacks context. Someone else might think something that's totally different from that. But for me, that's the fundamental difference with kind of going if you're taking any type of risk, then you're gambling. That being the mentality that would imply that we are in fact gambling at every turn and corner of our life in any capacity whatsoever, which then obviously from a philosophical standpoint, implies that there really isn't anything wrong with actually gambling. I kind of laughed at that because it made me think of that FanDuel ad. But overall, yeah, I think there is that fundamental difference, and that's why I view myself as an investor in this space as opposed to a gambler, because I do make a profit over the long run.

Shane Mercer [00:48:03]:

Ya you know, I think there's a key word sort of missing between the two. Right. And I love know my mind right away went to that FanDuel ad as well, which he was talking about that, because it's like, did you take this from FanDuel? Or maybe the FanDuel took it from you and heard you speak at some point before because it was right in line, right? You never know. But the idea of taking risks all the time in your life yes, we all do all the time but it's part of a plan and I don't think gambling, I don't think I've ever heard the terms gambling plan, here's my gambling plan and here's how I'm going to win. But investment plan is everywhere all the time and so that idea of planning to make a profit in a systematic way is the fundamental difference there, right? Whereas we just take a bet for fun, pure entertainment purposes that might be gambling, right? No plan involved. It's just on the spur of the moment, it's with your buddies like you set out at the golf course or something like that. There's no plan and there's no plan to do it again in the future to make more money. Right? Whereas what we do in the sports betting landscape is very well thought out, planned, meticulous. It sort of removes a lot of the other sort of downside risk. I thought that was a really interesting part of the conversation between terms.

Andrew Pace [00:49:30]:

Totally.

Shane Mercer [00:49:33]:

Okay, well I know that you wanted to get to the topic of Wynn bet which we talked about at the beginning and sort of bring it into context based on the interview and the conversation.

Andrew Pace [00:49:42]:

Well yeah, I think that gets to kind of she brought that up initially. But I think the risk reward conversation and gambling versus investing conversation is a really good segue into regulation. And when you look at stakeholders and obviously there's more than what I'll just say right now, but from the standpoint of the sports books themselves that need to make a profit, the consumers, the customers of the sports books of any capacity, whether they're winners or losers. And then obviously the regulators sort of being the major parties associated with the current landscape and the future landscape. That's where this whole discussion comes in, obviously, that you brought up with her as it relates to a winning player. So let's refer to that as someone who's investing and doing this for profit for the long term and where they fit in this equation. And then obviously the moral side of things as it relates to is it right to cater only to losing players? And how can you call yourself someone who promotes responsible gaming as a sports book or a regulator provided that you actually don't allow winners to play? So that whole discussion is obviously one that we've brought up a number of times here. But it's interesting then to get that perspective also when we know that there are certain sports books that don't limit winners that are profitable. So when you put this whole equation together and then you bring in regulation and then obviously the actual reality of survival. So Winbet and Fox bet and I have no idea how Winbet is done. But what I do know is that they're one of the most successful gambling names in the world. They obviously have win and encore on the Vegas Strip. They have one of the world's most renowned golf courses on the Vegas strip there and certainly someone that you probably wouldn't envision failing for lack of a better term, in this space. The flip side to that though is when this all started. Everything from the regulation aspect of it in North America, but also knowing that there's decades of history of regulated sports books that are in the UK and other parts of the world. When it came over here, you had the offshore model of how they treated customers. And she brought up using the terms like free bets and all that kind of stuff, the marketing verbiage, and obviously put the college kids fund, that marketing message that went out. But as a general statement, all of the offshore related tips, tactics, bonuses, rollovers, free bets, limiting players, affiliate marketing, a lot of the things that we've done episodes on roll into the regulated space pretty much unregulated. Yes, there's regulations and that's where you're like, this is a little bit like the wild, wild west out here. What is the regulation actually doing? And that's where you bring up the stakeholders and she goes, well, it's the tax dollars that ultimately are the major upside or gain of the regulation. Why was sports gambling and gambling online regulated in North America and across these different states and provinces? Well, it was done to produce tax revenue. So if they are not protecting the consumer for that reason, the onus of helping the government with an added new revenue stream then falls on the gambler or the losing player. It's so unbelievably, backwards and wrong. And then I think about, okay, what's happened in the last five years? We look at like cancel culture and some of the online practices that have been, sorry, some of the practices of companies that have been exposed online because of the fact that you came from an era where you were getting away with systematic. So many different things have sort of been canceled and exposed. And certainly what I'm referencing is nowhere near as dark as some of the things that we've seen come out over the last five years. But we live in a world right now where there's only so much you're going to be able to get away with before these practices start becoming mainstream. So that brings us to inplayLIVE and some of the influence that we've had, and she talked about, oh, they're not allowed to use that term anymore. We were influential in that change from the standpoint of being some of the key interviewees of the major articles that went out on the largest publications that then the regulators saw and realized, okay, this is bad, we can't get away with this anymore. But they were not changing that because that led to losses and taxes in their pocket. So the more that the story is told and put forward so that people do recognize what is happening in this space, the greater these changes start to sort of roll out throughout these regulators and the less and less it becomes like this sort of wild wild west environment. So the flip side to all that is where was all of this before regulation? Billions of dollars were wagered offshore through private bookies before regulation. Well, guess what happens? The consumer goes screw this, screw this sports book. Why would I bet with them? These offshore books in my bookie will take my action. I'm not recommending that that's the better alternative. And we'll be like, oh, use a reputable sports book. Well, who's to say the offshore sports books are less reputable than these regulated ones that are in bed with the side of this that's benefiting the losses. And a lot of these offshore sports books welcome sharp action because it makes their lines better, makes their lines sharper and it balances the handle that they have on any given game. So you look at that whole sort of landscape, and you go so you're offering -105 ODS on both sides of a game which is a really low vig that you really only find on offshore books. You don't find that in the regulated landscape. And we're helping balance the action on your sports book and we're no longer allowed to play because we hit the winning side of it. But the house still won. I'm sorry. That is bullshit at the highest level. So I am very much a believer that this message does need to go out in a way that does protect the consumer. And obviously we've talked about actual responsible vetting tools and one of the things that she brought up was the term bankroll and how that was something that didn't need to be thrown in advertising or all over advertising. There's a reason for that because the term bankroll implies that you're not deploying your whole deposit at once. The term bankroll implies that there's a systematic approach to what you're doing as it relates to tracking and taking wagers in a way where you are being responsible. So why do you think they're not advertising the term bankroll? Because people will be like, what does that mean? And how does that work for me in context of my hundred dollars that I would just put on a parlay this Sunday on the NFL instead of going oh no, I should only be doing one to $2 bets. And why? And all of a sudden that $100, even if you lost it all lasted you a much longer time.

Shane Mercer [00:57:18]:

Yeah, none of those terms thrown around in the advertising, no bankroll, no money management, no unit sizing, no tracking, none of that stuff. You're never going to hear about that from any of the sports books because hey, that's not in their interest, right? And it's not part of their message as part of from the conversation, though, I did feel a certain level of optimism in the sense that she believes that the regulators will mold, will change, will grow, will develop, and that this isn't a place of stagnation in any shape or form. It's a very dynamic marketplace that we're seeing and that the more often you end up in the pages of the Washington Post or the Wall Street Journal and on TV, on the news and that kind of thing. And the more people talk about these poor practices of the sports books, the more likely it is for lawmakers to want to change the regulation in their jurisdictions and perhaps put in better protections for the consumer, which is us, the sports bettor. So I was able to take away that little piece of positivity from the conversation.

Andrew Pace [00:58:33]:

Oh, I mean, the whole conversation is positive. It's just I'm looking at it from our lens, obviously. And for me, that stuff motivates me because to take what you just said, where you go, this is the positive takeaway. And then you apply that to what has already changed within the industry because changes have happened. You keep putting the message out there, you keep finding people to join your army. And if you are a listener of this podcast, you have to actually recognize that you have a responsibility to help this movement. And obviously you can go over to inplaylive.com. You click on our Free Tools link and inside of the Free Tools link is a list of every single state and province's regulator and the process on how to actually appeal some of the things that have happened to you. And that's a great way to go about things, but you will see time and again how infrequently the regulator cares until it's actually been put in a different forum, like a major publication.

Shane Mercer [00:59:40]:

All right, any other last thoughts before we say goodbye?

Andrew Pace [00:59:44]:

Well, Shane, I have a whole series of new discussions now that football, preseason football is back. I have crazy messages from sports books, so we don't have time to get to it today. But I think on transitioning out of that, I've put together some pretty incredible stuff that we're going to need to put out there for our listeners, but obviously also in line with that. So I would just say from the standpoint of malpractice or anything that you believe to be unfair that's happened to you in the sports books that you would bring to your regulator, you can also feel comfortable to reach out to us with those things. We can bring them up on the podcast. We have connections that can help get those particular issues published as well. And that obviously leads to a greater future for all of us and also for the next people to come through so that we can continue to purify.

Shane Mercer [01:00:40]:

The landscape and that's what we're working towards. But as Pace mentioned too, stay tuned. For more episodes because, yes, it is preseason football, which means real football is just around the corner and we are going to be talking a lot about the NFL season. Obviously, as sports bettors, we are very excited about it and there's a lot to dissect in this in just the NFL betting landscape. And even the sports books themselves, they plan their calendars around the NFL season in a major way. In fact, with this big merger between Penn and ESPN, that all sort of right aligning just in time for the NFL football season. So we will have some episodes coming out that focus on the NFL season. So stay tuned for that. And Pace, I just want to say I'm very much looking forward to meeting you in person, meeting the entire inplayLIVE pro group in person in Vancouver. That's right, we are all getting together for a big community event, the inplayLIVE pro retreat. I can't wait, Pace. It's going to be awesome.

Andrew Pace [01:01:41]:

That's what it's all about, buddy.

Shane Mercer [01:01:43]:

All right, buddy, till next week. Keep beating those books.

Andrew Pace [01:01:45]:

Cheers.

Shane Mercer [01:01:46]:

Thanks for tuning in to another episode of Behind the Lines. Remember to like, download and subscribe. We are on YouTube, Apple, Spotify and everywhere you get your podcasts. Have a betting story or want to be featured on our podcast, drop a note in the comments below. And if you want to join inplayLIVE, use promo code 'BEHINDTHELINES'.