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The idea that a Las Vegas casino could someday accept wagers on video game competitions might once have seemed unthinkable, but it has rapidly become a very real possibility.
Already, the Strip has hosted thousands of people for major events dedicated to competitive video gaming, or e-sports, and one downtown casino has sought to become a hub for the activity. The action may soon spread to sports books, pending further direction from state regulators and policymakers.
A.G. Burnett, chairman of the Nevada Gaming Control Board, said the discussion had boiled down to a simple question: Do e-sports competitions constitute “athletic events?” If so, sports books could start accepting wagers on them right away. If the answer is no, Burnett said, books could still apply for regulatory permission to offer bets on the competitions.
The question may be resolved by the state’s Gaming Policy Committee, a special group that Gov. Brian Sandoval convened to study important gambling-related issues. The committee discussed e-sports betting at its meeting in May and should return to the issue later this year.
Burnett, who sits on that committee, said there were “a couple nuances” to iron out with regard to e-sports betting in Nevada, but he did not believe they posed a significant obstacle.
“I’m sure that e-sports betting will be up and running in Nevada within the next couple of months, unless the Gaming Policy Committee were to say, no, we think it’s a bad thing, or we think it’s a bad idea to allow wagering on it,” Burnett said. “The impression I get is that everybody understands it, everyone agrees that the books should be allowed to take bets on it, and we’ll probably move forward.”
If that happens, a bettor would theoretically be able to place a wager on the outcome of an e-sports event just as he or she would on a major boxing match, for example. Regulators would treat e-sports the same way they do other athletic events, according to Burnett.
E-sports is a hugely popular spectator activity in the United States, drawing packed crowds at such venues as Madison Square Garden in New York and KeyArena in Seattle. In Las Vegas, a championship tournament for the game League of Legends was held in April at the 12,000-seat Mandalay Bay Events Center, where part of the Evolution Championship Series tournament, or Evo, will also be held soon. Part of that event will also be held at the Las Vegas Convention Center.
The April event was the first such e-sports event hosted by Mandalay Bay’s operator, MGM Resorts International, according to spokesman Scott Ghertner. In an email, Ghertner said he wasn’t aware of any similar events confirmed aside from Evo but that the senior management of MGM Resorts was “always looking for opportunities” related to e-sports.
As the industry has become increasingly popular overall, betting on e-sports — in many cases via unregulated websites — has become a popular activity as well. A recent report from gambling industry analyst Chris Grove estimated that, this year alone, some 8 million unique players would wager more than $8 billion on e-sports worldwide. (For comparison, wagers on traditional sports at Nevada sports books exceeded $4.2 billion last year, which does not include race betting.)
Grove’s figures include not only cash but also betting using “skins,” which are virtual items that players can use within a game, often for cosmetic purposes such as changing the color of a gun in a first-person shooter game. Players can’t exchange skins for cash within the games themselves but can do so on “secondary markets,” the report said. Those secondary markets are not operated by the game developers, according to Grove.
Betting on e-sports appears poised for even more substantial growth in coming years: Grove’s report anticipates the total value of money and items wagered around major e-sports titles to rise to $29.8 billion by 2020, with some 15.4 million unique customers placing bets.
Nevada’s casino industry is aware of the opportunity there — hence, the regulatory conversations, big events on the Strip and the Downtown Grand’s creation of an e-sports lounge, among other efforts. Still, Grove’s report, based on surveys with more than 200 casino stakeholders, said the industry was “broadly aware … but not yet fully committed” to e-sports.
Just 15 percent of the respondents in Grove’s report said they had attended a live e-sports event, and only 39 percent of those who hadn’t said they planned to do so in the near future. Meanwhile, 82 percent of respondents said they thought regional casinos should explore hosting e-sports events and 76 percent said e-sports betting should involve the same or less regulation that traditional forms of sports wagering.
Grove said in an interview that the casino industry was still adjusting to a lack of familiarity with competitive video games and all the opportunities they afforded.
“There’s this sort of inherent uncertainty about it,” Grove said. “They’re not quite sure about this demographic yet, they’re not quite sure about e-sports yet, and they’re not quite sure, frankly, how they fit into that culture and how they fit into that demographic and are a little leery of charging in full-steam with all of those questions unanswered.”
A casino’s full embrace of e-sports could entail even more than hosting events and offering lines on matches at the sports book. Grove’s report envisioned a hypothetical casino that integrated e-sports into its layout even more, with viewing parties at a bar, after-parties at the pool and the nightclub, e-sports themed slots on the casino floor and shops with “high-end gaming peripherals.”
Live e-sports events would be a good fit for brick-and-mortar casinos because they would bring an attractive audience of potential customers, often for multiple days via “a buffet of formats and sizes,” the report said. And casinos, in turn, offer flexible spaces, good event infrastructure and easy access that should appeal to e-sports fans.
But for all its opportunities, e-sports — and gambling on it — also comes with its own unique challenges. One is that, as an international and fragmented industry, e-sports lacks an established, central agency that can enforce the rules (although the new World Esports Association is a step in that direction). That’s a particular area of concern as officials contemplate the gambling side.
“It is a valid concern, because without that central organization, you do have some fundamental questions about accountability, and you do have some fundamental questions about transparency,” Grove said. “When you’re talking about betting, those are two pieces that you really want to have on lockdown.”
Burnett said that was certainly a factor that needed to be considered moving forward.
“What we’re going to do is really look hard at whoever is offering the tournament or the championship, and assess whether it’s something our books should be able to take bets on or not,” he said. “While we may not allow bets on every single e-sports event, I can certainly think of a couple.”