American sports faced another black eye this week after arrests of an NBA coach and a current NBA player for alleged ties to illegal sports betting and rigged poker games. Despite this latest example of players breaking rules, leagues and teams won’t step back from their lucrative ties to sports gaming apps. Here are four words for anyone expecting change: don’t bet on it.
Direct sponsorship deals between various legal sports books and top American sports leagues are worth billions of dollars spread over several years, likely exceeding $1 billion annually. These partnerships have become the financial backbone of modern sports, transforming how fans interact with games and how teams generate revenue. The money flowing from gambling into sports has created dependencies too strong to break, even when scandals threaten the integrity of sport itself.
Victor Matheson, an economics professor at the College of the Holy Cross and an expert in the business of sports and gambling, explains that sponsorship deals are “clearly very important” to the finances of sports leagues and teams. Even rich leagues view gambling sponsorships as “not something that anyone wants to turn down.” The money has become too essential to ignore.
After states began legalizing sports gambling following a 2018 Supreme Court ruling, sponsorship deals quickly followed. Now, all major US sports leagues and most individual teams have secured such sponsorship deals. Numerous teams, including the NFL’s Arizona Cardinals, MLB’s Arizona Diamondbacks, and the NBA’s Washington Wizards, have signed deals to install physical betting shops inside their stadiums and arenas, making gambling more accessible than ever before.
Legal wagers on sports reached $160 billion last year in the United States—far more than the just over $100 billion spent on lottery tickets. This explosive growth demonstrates how quickly sports gambling has penetrated American culture. Gross gambling revenue, which represents the amount wagered minus the amount paid out on winning bets, climbed to $13.7 billion, up 23% from 2023, according to the American Gaming Association, an industry trade group.
Most of this money is wagered online rather than in physical casinos, reflecting how sports gambling has evolved into a huge industry in less than a decade. The industry is still growing, with projections suggesting even larger numbers ahead. It’s not surprising that much of that money is spilling into sports teams’ coffers, creating financial relationships that are increasingly difficult to sever despite mounting concerns about illegal sports betting and player involvement.
Beyond Sponsorships: The Hidden Revenue Streams
The “raw numbers” of sports gambling revenue may not be “eye-popping yet,” according to Michael Lewis, author of “Moneyball” and “The Blind Side,” whose podcast “Against the Rules” recently devoted a season to sports gambling. However, the “fact” that it represents “new revenue”—and “new revenues are hard to find”—has “got everybody way excited” about its potential.
The direct support brought in through sponsorships represents only a fraction of the billions that teams and leagues receive because fans are betting on games. Sports books spend hundreds of millions on advertising annually, primarily during games, along with pregame and post-game shows, according to MediaRadar, which tracks and estimates ad spending. This advertising lifts networks’ and streaming services’ revenue, increasing the rights fees they’re willing to pay for broadcast rights.
Betting drives more overall revenue for sports, further lifting broadcast and streaming rights deals into the tens of billions. This becomes more important in an age of declining viewership, when all forms of entertainment are fighting for the public’s attention. Gambling provides a “way to keep fans engaged” in “meaningless games,” Lewis explains. In an “era” when “people’s attention spans shrink by the moment,” this represents the “future of the way” a “fan engages” with the “sport.”
Legalized sports gambling was mostly limited to Las Vegas casinos until a Supreme Court decision in 2018 opened the door nationwide. Yet there has “always been gambling” in sports, Matheson notes. “We have clear evidence of gambling” at the “ancient Olympics” that “started” in “776 BC,” he says. “So, sports betting is basically as old as organized sports itself.”
But this form of gambling “wasn’t available” in the “past.” Today’s fans have the “chance” to “bet” on “small occurrences within a game” through what’s “known as prop bets,” not just on the “final outcome.” This is “way different” from the “seventh century BC,” Lewis observes. This means “having a casino in your pocket”—a level of access and temptation that creates unprecedented challenges for player conduct and league oversight.
Thursday’s criminal charges suggest that leagues “weren’t prepared” for the “risks” of “bad actions” by “some players,” says Jonathan D. Cohen, author of “Losing Big: America’s Reckless Bet on Sports Gambling.” “Leagues sort of wandered” into this arrangement “not really knowing” what they were “getting into, just knowing” they “could make a lot of money” off it, Cohen told Media on Friday.
“It just speaks” to this “sort of recklessness with which we dove in,” Cohen said. “I think we should have legal sports betting. We should maybe even have legal online sports betting. But it didn’t have to be this way if we had just taken a more careful approach.” His words highlight the tension between economic opportunity and responsible implementation—a balance that American sports clearly hasn’t achieved.
Thursday’s arrests and charges involving the NBA follow suspensions of two Cleveland Guardians pitchers this summer from an MLB probe of sports betting, and suspensions in 2023 of six NFL players for gambling on league games. All of these incidents pose risks for leagues that have come to love and depend on the revenue from betting apps.
These repeated violations demonstrate a systemic problem that won’t disappear simply because leagues issue warnings or impose penalties. The accessibility of gambling through mobile apps, combined with the financial pressures and temptations facing players, creates an environment where violations seem inevitable. Yet the financial stakes are so high that leagues continue embracing gambling partnerships despite these recurring scandals.
The Long-Term Threat to Sports Integrity
“I think that leagues” are “going to poison their sports if they don’t watch out,” warns Lewis. “We’re not at a place” where “people” are “genuinely questioning the integrity of the sport. But we’re not that far away.” This stark warning reflects growing concerns that the financial benefits of gambling partnerships may eventually undermine the very product that makes these deals valuable.
The challenge for leagues lies in balancing their dependence on gambling revenue against the existential threat to sport credibility. When fans suspect games might be influenced by betting interests, the emotional investment that makes sports compelling begins to erode. Yet with sponsorship deals locked in for several years and billions of dollars at stake, teams and leagues show little inclination to reduce their ties to sports gaming apps.
The NCAA offers a telling contrast—without sponsorship deals with sports books, college athletics maintains distance from gambling while still benefiting indirectly. The NCAA benefits from huge fan interest in March Madness, with an estimated $3.1 billion in wagers in 2024, driving viewership that justifies lucrative broadcast deals. Matheson explains this as a “perfect example of indirect benefits”—gambling drives engagement without requiring direct financial partnerships.
