Page 75 - Public Gaming International September/October 2017

Pulse

of the

Industry

These news stories comprise a small fraction of the gaming and lottery news stories posted every day to
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North
American • New York schools ($3.3 billion in wagers and/or entry fees. For sports betting,
2016)
illegal offshore handle is estimated at $150
News • Georgia schools ($1.1 billion) billion. For DFS, the handle in 2016 was
• Rhode Island’s general fund ($370 more than $3 billion.
million)
Daniel “Danny” Rachek • Louisiana’s state budget and problem
appointeD executive gambling fund ($178 million) Revenue in sports betting and DFS is only a
DiRectoR of the veRmont • Massachusetts’ general fund, cities fraction of handle. Revenue can be variable
lotteRy and towns, arts council and compul- in sports betting, but unless oddsmakers are
sive gambling fund ($989 million) consistently inaccurate in establishing lines,
Rachek, an Essex resident, begins his post they should be able to generate net positive
November 13. He currently serves as head In 2016, $80 billion in Powerball and other revenue on an annual basis. Sportsbooks
of the Vermont office of the Federal Bureau lottery tickets were sold. That’s more than typically hold about 5% of handle, accord-
of Investigation, where he’s worked for was spent last year on movies, video games, ing to data from the UNLV Center for
more than 22 years. For the past six years, books, music and sports tickets combined. Gaming Research.
his service included supervising 20 FBI Of that amount, $46 billion was paid
employees assigned to Vermont. out in the form of prizes. States spent $4 DFS websites take a percentage of all entry
billion on advertising and commissions for fees. That revenue equates to 10 to 15% of
In addition to his experience leading stores that sell tickets and other operations,
in-depth financial investigations with the leaving about $23 billion, or 31% of the handle. In 2016, Eilers & Krejcik Gaming
FBI, Rachek has been responsible for repre- total intake, to fund education and other reported that figure to be more than $300
senting the Bureau at various community programs. million. In other businesses, the money
outreach events, press conferences and that companies “handle” is regarded as
meetings with other regulatory agencies SPORTS BETTING, DFS the same as revenue. If you pay a company
and corporations. He’s also led workshops REVENUE ESTIMATES OFTEN for a good or service, that money is used
for banks, credit unions, town managers, OVERSTATED by the company to produce goods, pay
colleges and universities on a variety of employees, and otherwise conduct busi-
financial topics. It is a common occurrence: revenue esti- ness. The money, or handle, that flows
mates in the sports betting and daily through sportsbooks and DFS operators is
POWER BALL AND PUBLIC fantasy sports businesses are significantly different. It is money that is “handled” for
FUNDING overstated, and the erroneous figures are the a time by a book or DFS site before being
result of misunderstanding two interrelated
The North American Association of State concepts. In short, industry groups and paid out to winning players. Handle is a
and Provincial Lotteries reports that journalists conflate revenue and handle, useful figure for determining volume and
Powerball and other lotteries contribute which are two very different things. growth trends, but revenue is the money
billions of dollars to state agencies, includ- Handle is how much money bettors and that goes into the sportsbooks’, casinos’ and
ing the following beneficiaries:. daily fantasy sports players are spending on DFS sites’ pockets.

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