Many people initially questioned whether there was an actual need for legal sports betting in Iowa. Indeed, green lighting its use is now standard across the country. There is legal online sports betting in the United States for almost every region at this point. More than half of the USA, in fact, has approved some form of gambling over the past few years.
Still, because Iowa doesn't have the most booming professional sports market, many wondered whether implementing the ability to wager online would be worth the trouble. And it wasn't entirely clear early on. Though Iowa bagged more than $200 million in total sports bets during the first month it was legalized, most of that money came from on-site wagers. Experts actually pegged the revenue generated from online betting specifically to be somewhere around $6 million to $10 million—or roughly 5 percent of all sports betting business.
Fast forward to the start of 2022, and nearly everything's different. Iowa recently released their sports betting numbers from the month of January, and the returns are massive. They set monstrous records ahead of both the Super Bowl and 2022 March Madness tournament. More than $300 million worth of sports wagers were placed from January 1 through January 31, with a whopping $275-plus million of that business coming from online traffic.
Dramatic upticks like this aren't normal. And that begs the question: Is Iowa's record-setting January sustainable, or should they brace for regression?
Why Did Online Sports Betting Explode in Iowa to Start 2022?
Many factors contributed to the drastic uptick in online sports betting throughout Iowa to begin the 2022 calendar year. And while it isn't clear which reason is primarily responsible, most attribute it to the extra week of regular season NFL football.
That's a fair point to make. The NFL is the single biggest sports betting draw in the United States. By tacking on an extra week of games that count, the league increased sports-betting revenue by millions. Granted, exact figures aren't available to support this logic, but it's mostly common sense. The NFL replaced preseason action that isn't a betting draw with regular-season action that appeals more heavily to betting customers.
Still, one extra game isn't going to account for nine figures worth of extra business in the online betting sector. To be honest, no one sporting event can have that kind of impact. Instead, this is the culmination of a trend that has unfolded over time.
Call it patience. Iowa's online sports betting market was always going to continue to grow after its initial installment. People needed time to complete the process—to combo through reviews of the best online sportsbooks, set up accounts and get a feel for the new form of entertainment available to them.
Remember: It's not like we're saying this is the only month-over-month increase Iowa has seen. They rolled out the red carpet for online sports betting in September, and their total revenue stream has gradually ascended in every month since. The returns in January were merely the most absurd of those increases.
Will Sports Betting Continue to Surge in Iowa?
Optimism over the future of sports betting in Iowa is of course at an all-time high after another record-setting month of business. We're not here to neuter that rosy outlook. But Iowa must be careful to adjust expectations moving forward. They're not going to have a $275-plus million month in online betting all the time.
To be sure, there shouldn't be any drop-off in February. Those returns will include money invested in the Super Bowl, and that's always a sports-betting magnet. Iowa could also enjoy a similarly lucrative month in March, thanks to the interest in college basketball's 2022 March Madness tournament—a weeks-long event that will no doubt generate tens of millions in sports bets.
What happens after that, in April and May specifically, is anyone's guess. The NBA playoffs and, eventually, NBA Finals will dredge up sports betting business. But there aren't any tent-pole events or tournaments that take place during those months. What's more, there's a chance the 2022 MLB season gets delayed or outright canceled because of the current strike as the players union and owners negotiate a new collective bargaining agreement.
So, no, Iowa should not expect to set sports-betting record every month. At the same time, the future of online sports betting in Iowa absolutely remains something to be excited about. They were seeing steady growth even before now. Any and all concerns about a relatively slow start were significantly overblown, and there will inevitably come a time when the state settles into quarter-billion-dollar months, on average, across the entire year.
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