The American Gaming Association has written an open letter to the Maine Gambling Control Unit (MGCU) which suggests that its tentative set of regulations governing sports betting ads are overly restrictive.
The rules, provisionally announced in January, would bar sportsbook ads that offered promotions or bonuses, outlaw all TV ads except those which take place during a live broadcast and prohibit "professional or Olympic athletes, celebrities or entertainers" from appearing in such ads.
According to the AGA, the national trade body representing the U.S. legal gaming industry, these restrictions would unnecessarily and unfairly undermine the ability of legal sportsbooks in Maine to compete against illegal and offshore operators.
"As Maine has recognized, legal sports betting enhances consumer protections and helps promote transparency and game integrity, while also supporting job growth and generating tax revenue," said AGA President Bill Miller in a letter made public on Tuesday.
"However, to realize these benefits, it is important to avoid policy decisions that – even if well- intended – will ultimately undermine the ability of the regulated marketplace to compete against illegal sportsbook operators."
Sportsbooks compete with illegal operators
In a study released in November, the AGA estimated that Americans place $511 billion in bets per year with illegal, untaxed, and unregulated operators at a cost of $44.2 billion to legal operators and $13.3 billion in lost tax revenue to state treasuries.
The gaming body has consistently argued that a legal, regulated market provides consumer protection and responsible gaming, and generates state tax revenue which can be used to fund programs to treat problem gaming.
"The AGA urges the Maine Gambling Control Unit to remove the restrictions on advertising contained in the proposed regulations, which – if adopted – will undermine a critical tool that the legal industry uses to inform the public about licensed operators, further empower illegal sportsbooks, and limit the success of the legal market in Maine," read the letter from Miller.
"Legal sportsbook advertising has an essential role in drawing bettors away from the predatory illegal market to the protections of the legal, regulated market," added Miller.
State regulators dial up the pressure
State regulators also find themselves under pressure to rein in sportsbooks that have inundated the public with non-stop ads during sports broadcasts in particular.
The New York State Gaming Commission has just announced that it is considering the imposition of tougher rules regarding sportsbook advertising that would ban the use of promotional language such as "free" or "risk free" and outlaw any ads targeting underage residents.
In addition, the Massachusetts Gaming Commission has issued strict regulations that ban all sportsbook ads aimed at minors or under-21s and saw Commissioner Brad Hill complain over what he believed was an overly wide package of wagering options.
Meanwhile, Ohio state regulators levied over $1 million in fines in January for ad policy violations by BetMGM, Caesars, Barstool Sports, and online sports betting giant DraftKings which was sanctioned a second time by the state Casino Control Commission.
Maine gaming industry's viability threatened
Maine first issued draft rules for online sports betting sites on January 11, five months after its legislature passed the bill that legalized mobile sports wagering in the state, but the proposed rules are engaging in the kind of regulatory overkill that the AGA believes would merely work in favor of illegal and offshore operators.
The ad restrictions could well turn Maine into a pariah state among the leading U.S. sportsbooks.
With a tiny population of 1.4 million residents, Maine authorities estimate that online sports betting will only generate an additional $3.8 million to $6.9 million in revenue on top of the $64 million that Maine casinos and other legal gaming outlets produced in 2022.
Milton Champion, Executive Director of Maine's GCU, does not expect online sports betting to be available until the summer. Although the vetting and licensing process could in theory see sportsbook licenses being issued as early as April, the regulatory timeline could also extend as late as January 2024.