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For the longest of times — and to this day — Native-American tribes and operators have been at odds. At odds over who controls legal sports betting in many states across the country.
Take sports betting in Oklahoma, as an example. Tribes there have the sole right to offer casino gaming. However, they’ve chosen not to be at the negotiating table to expand into sports betting after the governor attempted to bring in outside operators — to the chagrin of local tribes who felt their exclusivity was being violated by the move.
It’s one circumstance of the high tensions, but believe us, it’s the same in other states. That’s why it was earth-shattering when both sides were on the same side of the table against another interest. You’re going to want to keep reading to get a low down on this unlikely alliance.
Sweepstakes Draws The Ire Of Both Sides
Victor Rocha is a name we’ve mentioned time and time again on this site. He’s a representative of the National Indian Gaming Association, a group that represents Indian interests in the state of California.
Anyway, Rocha recently had a webinar open to the public. It also included fellow team member Jason Giles, who is executive director of the National Indian Gaming Commission. But a third person was brought on and this is where things got interesting. Joining along was lobbyist Jeremy Kudon, who represents the Sports Betting Alliance. That group is essentially the mouthpiece of the “Big 4” operators — BetMGM, DraftKings, Fanatics and FanDuel, — who financially back it.
The topic of conversation? The latest craze of “unregulated, unlicensed and untaxed” betting — sweepstakes. Both the Indians and operators feel sweepstakes are taking a bite out of the gambling pie and doing so illegally. There was no dog-whistling here, the webinar was called and promoted as “Common Ground: Will California Tribes and Sports Betting Alliance Join Forces Against Sweepstakes Threats?” The keyword in that name is threats.
Let’s not forget just two years ago, Indian Country and SBA were campaigning against each other in the state. The Indians wanted sports betting on the ballot in the Golden State, while SBA didn’t (because it would only allow the tribes to offer it). SBA racked up a $500 million bill to fight the Indians but ultimately lost. But the Indians eventually lost on the ballot as Proposition 27 was overwhelmingly voted against. In the end, the ordeal was a black eye for both groups.
The point is: things got nasty in 2022. That’s why this joint webinar felt shocking. It goes to show you the “threat” of sweepstakes companies if it was enough to bring the two sides together for once. Let’s explain why they’re mad.
The Threat Of Sweepstakes
Sweepstakes were a massive talking point at the Gaming Global Expo in early October. Sweepstakes are pseudo raffles that contestants can join for an entry price. There’s a big prize at the end for a few lucky contestants. Of course, this can be viewed as gambling.
“I hope they see why in regulated states, why would you allow Fliff not to pay the $25m licence fee or the 51% tax that my clients pay [in New York] on every bet?,” said Kudon.
Fliff is a platform that’s big in the sweepstakes world. Though, they call it “promotional games” — not sweepstakes on their site, purposely, no doubt, to avoid any heat. Fliff is legal to use in most states, including those where sports betting isn’t legal.
Fliff is gobbling up a sizable part of the betting market — even if they’re not being categorized as that. Moreover, those sites must only pay income taxes, not extra gambling taxes like tried-and-true operators or Indian tribes. Of course, that aspect is where much of the ire comes from.
“This is the moment for all of the commercial operators and sovereign nations to band together and root this out,” Kudon said on the call.
Fantasy Pick Platforms Also Targets
Sweepstakes received the brunt of the criticism during the joint webinar. However, another talking point was “DFS 2.0” as Rocha called it on the webinar.
Companies like PrizePicks and Underdog Fantasy, and Fliff again, fall into this category. They are a contrast to “DFS 1.0” where DraftKings and FanDuel earned their stripes before legal betting. What separates the two is the games offered.
Per Kudon, who lobbied for DraftKings and FanDuel when they were pure DFS platforms, there’s a clear difference between the two. DFS 2.0 is offering straight-up pick-em games.
“They use the words ‘fantasy sports’, but it’s really a player prop,” Kudon said. “Will Bronny James play more than one minute? Score more than two points? Yes or no? That’s the same as sports betting. Those are sportsbooks and they should not be operating in California.”
If you remember, DFS 1.0 was offering fantasy-style games and more than that, players were competing against one another. In most of these pick-em games, players are up against “the house.”
We have no dog in this fight, but we do find it interesting. Don’t expect this story to die down, it’s only the beginning of these two powerful sides — operators and Natives — joining forces for essentially the first time.
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