The Ohio Sports Betting Industry is Facing Increased Scrutiny from Regulators

The business of sports betting in Ohio is only a few months old, and yet, regulators are already cracking down on a number of industry practices.

This increased scrutiny is ramping up in a number areas. Mostly, though, the Ohio sports betting industry is drawing intense ire from state officials for their advertising procedures.

As a result, The Buckeye State is attempting to implement policies and punishments that dissuade business practices they deem exploitative and harmful. Will they be successful? What will these enforcements even look like? What does this say about the overarching future of Ohio sports betting? And what about the future of sports betting across the rest of the United States in general?

Let's dig into all the details.

Who Will Be Impacted by New Ohio Sports Betting Policies?

Most assume that it'll be sports betting operators who are impacted by Ohio's gambling crackdown. They're not wrong. They're also not totally correct.

Bettors themselves will also be affected by the state's attempt to rein in an industry they believe is rife with issues. Most notably, Ohio will reserve the right to "bar gamblers if they threaten or harass athletes after lost bets," according to an explosive report from The New York Times' Eric Lipton and Kevin Draper. The Buckeye State is not alone in their efforts to police abusive behavior directed at athletes. There is a sports betting bill in West Virginia that seeks to do the same. Other states have seriously discussed the issue during the latest round of legislative meetings, as well.

Even so, the majority of Ohio's focus has lied—and will continue to spotlight—the exposure of minors to sports gambling. The state doesn't want betting operators having such readied access to a market they're not legally able to service. Their path to prevention begins with advertising. Sports betting companies have been allowed to sign partnerships with collegiate teams and universities, where the majority of students aren't yet of gambling age (21). This says nothing of the access companies gain to minors simply by flooding the market with television and online advertisements.

Many have wondered whether this is actually an issue. Don't sports betting operators have their regulations in place, after all? They do. But key stakeholders believe that's not enough.

“Folks are waking up to the need to intervene and not wait a decade and have the full brunt of harmful effects of this, particularly on minors,” Matt Schuler, executive director of the Ohio Casino Control Commission, told The New York Times. “The industry will certainly never police itself.”

The Sports Betting Industry is Spending a Boatload of Money on Advertisements in the United States

If the latest spending reports are any indication, Schuler's concerns aren't just well-founded. They are 100 percent accurate. Consider this excerpt from Eric Lipton and Kevin Draper in The New York Times:

"An estimated $1.8 billion was spent advertising online gambling last year in local markets in the United States, according to BIA Advisory Services, an industry data aggregator, up nearly 70 percent in just one year, contributing to a sense among certain state regulators — and many sports viewers — that the airwaves had become too saturated with sports betting ads."

A 70 percent increase in spending on advertisements over the course of a single year is absolutely bonkers. But the number tracks when you consider the market climate. It doesn't matter how you consume sports—via your cable provider, from a streaming service, through YouTube highlights and recap packages, etc. Regardless of how you watch games, you're going to encounter some form of sports betting advertisements. 

What's more, sports betting operators don't really have the incentive to slow down. Nearly three dozen states have now legalized sports betting in the United States. Prospective clientele isn't only on the rise, but so is the competition. More and more odds providers have entered the market.

The list of top online sportsbooks operating in the USA has expanded to include smaller domestic companies as well as juggernaut corporations who primarily work abroad. Sportsbooks now feel the pressure to rake in business over their competitors by any means necessary. Advertising is among the most effective ways to accomplish that, which is why you can't go anywhere, or do anything, without running into a billboard, video ad, podcast read or something else that contains a promotional code sponsored by a specific sportsbook.

Regulators Are Already Cracking Down on the Ohio Sports Betting Industry in a Big Way

Additional regulation of the Ohio sports betting market sounds good in theory. It obviously makes sense to create the safest environment possible. But many remain skeptical states—including Ohio—can effectively get the job done. The undertaking is considered too vast, and plenty of people question how committed officials will be to penalizing an industry that is generating, in some cases, hundreds of millions of dollars in revenue each year.

For their part, Ohio appears to be making good on their end of the bargain. Granted, not all of their new policies are in place yet. Some are still waiting approval. But Ohio has already rolled out a number of measures aimed at taming sports betting advertisements. And to date, The Buckeye State has doled out over $800,000 in fines to gambling operators that stray from the criteria. That may be a drop in the bucket to most of these companies. It's also not an insubstantial amount when you consider that legal sports betting in Ohio only went live on January 1.

And if you think the state is only targeting lesser-established operators, then think again. According to The New York Times, Ohio recently fined DraftKings, one of the most popular betting platforms in the United States. As part of an investigation, DraftKings "acknowledged it illegally claimed bettors could make “free” bets and mistakenly mailed out 2,582 advertisements to state residents under the legal betting age of 21, urging them to download its mobile app and claim $200 in free bets."

Whether Ohio's new sports betting policies will have the intended impact is a matter of course. The industry isn't going to change overnight. Nor is it going to change by the actions of one state. Others need to follow suit. If nothing else, though, it seems safe to say that Ohio is prepared to lead the way when it comes to winnowing down the influence and access sports betting operators have on people under the age of 21. 

Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs: