The Business and Ills of Sports Betting

The Business and Ills of Sports Betting

As the football season begins,  millions around the world cannot wait to get back to their screens to watch their favorite teams and players get back to action. The excitement that follows the new season after weeks or more appropriately months of relative boredom in the absence of competitive matches, is something every sports lover will find very difficult to explain. As they prepare, betting companies are getting ready too. Of course they are ever ready for they never run short of those that patronise them.

Probably, I should just mind my business, but the fact is most individuals who put their money into these ventures hardly complain, so why should I? You can only hear complaints unless they have lost something big enough to be of concern to them. The little amounts they lose on installments hardly ever serve as a deterrent.

I wouldn’t want to get into the ethics of gambling, for it will lead to divisions  along the lines of morality. These kinds of debates are difficult to handle. One evening in a football viewing centre, a match between two teams in the English Premier League was going on. A middle aged man had placed a bet on a list of outcomes all of which was going as planned. He had placed an accumulated bet on about 10 different games of which 9 had clicked. He was watching the 10th game expecting the game to end as a draw so he could cash out about two million naira. In the 91st minute, the home team conceded a corner kick which was volleyed into the penalty box. After the two teams scrambled for the ball for a few seconds, a player tapped the ball into the back of the net. It was a win, and his bets has just been nullified. As he left to ease himself in a convenient corner he slumped. He had a stroke that left half of his body paralyzed.

Cases like this abound, and the pleasant stories too. Many of us must have heard stories of individuals who won millions in a bet. These stories sometimes serve as the reason why every one who places a bet on such events gets motivated to do so.

 Let’s take this hypothetical scenario as an event that could represent as close as possible a sports betting event.

Two men Mr A and Mr B  walked into a bar with $1000 each (a total of $2000). After gambling for hours, Mr A  comes out victorious and now has $2000 at the end of the day. Remember that at the end of the period the total amount of money between them remains the same as no additional income or revenue has been created. What merely happened was the transfer of money from Mr B to Mr A and nothing else. That’s not all. 

Also consider that valuable time was wasted which cannot be replenished. If two individuals gamble for two hours, they have expended 4 man hours, which is half of an individual’s productive day. It would be tolerable if that was the only case, but also consider the depletion of public utility that must have taken place in that limited time frame. Like electricity used, the chairs they sat on must have depleted by a fraction, whatever they used must have been less than what it was at the initial instance.

A venture that creates no additional income or revenue, but consumes time and depletes public utility.  Should this kind of venture be encouraged?  

On the other hand, proponents of gambling are of the opinion that since betting companies generate a lot of revenue and pay huge taxes to the government gambling should not be discouraged or banned. It’s easy to understand their perspective since money is taken from the “clueless” and given to the “clued” (betting companies and government)  who can invest these profits into economic ventures in the real sectors of the economy. Betting business also creates jobs for forecasters, website designers, computer operators etc and then the ripple effects of the indirect jobs created.

Many also argue that it curbs youth restiveness. That the hope of success (real or apparent) which keeps these gamblers perpetually or temporarily engaged can curb the kind of crimes which results from idleness and lack of hope. It gives them hope of a better tomorrow, apparently keeping them away from crime today. Young people have a lot of energy to expend, and the absence of avenues to expend this energy leads to youth restiveness .

According to an online report (legalsportreport.com), “The UK Gambling Commision  (UKGC) recently covering regulated gambling up to September 30, 2015. The figures show a total annual gross gambling yield of £12.6 billion ($16.3 billion), of which 29 percent comes from online gambling.

Total sports betting wagers came in at £9.518 billion ($12.32 billion). Gross gaming revenue from that was £1.499 billion ($1.94 billion) indicating a margin of just over 15.7 percent.”

Simply put, the sports betting business is a multi billion dollars business too hard to ignore.

As the debate goes on, the government  in order to regulate or maximize this trend may simply do the following :

1.Place a limit on the maximum possible  bet within a specific time frame.

2.Tax online betting companies appropriately or a little bit more.

3.Use the proceeds to invest in the real sectors of the economy.

I wish you all the best as you contemplate. 

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