'Everybody Loses': Reporter says he was shocked by sports betting's grip on leagues, media

The NCAA Men’s Final Four gets underway this weekend in Indianapolis, Indiana. There are estimates the basketball tournament generated more than $3 billion in legal bets. Earlier this year, the American Gaming Association forecast bettors would wager more than $1.5 billion on the Super Bowl — again, legally.

Reporter Danny Funt says even with the increase in the availability of legal sports betting, and noted increases in people doing it, it’s even more prevalent in our society than we think it is.

Funt has covered the sports betting boom for the Washington Post and other outlets. His latest book is called "Everybody Loses: The Tumultuous Rise of American Sports Gambling."

When Funt spoke with The Show, the interview started with whether we know how much the market has grown, in terms of whether there are more people gambling on sports overall, or the same number of people as before, but gambling more money, or more people gambling more money.

Full conversation

DANNY FUNT: There's good reason to think the answer is all of the above. More people, more money on more things. It's a conspicuously understudied area, though. There hasn't been a national study conducted by the federal government of gambling prevalence since 1999.

And when I ask people why, whether it was lawmakers or people in the industry or researchers, many of them speculate that it's by design that the industry is resistant to studying things as basic as how much betting goes on and certainly how many people have betting problems, because the industry would face greater scrutiny, and politicians would face criticism potentially for authorizing this.

As Keith Whyte, the former longtime head of the National Council on Problem Gambling, put it, they want to count the revenue, they don't want to count the bodies.

MARK BRODIE: Well, how is it that this industry got so big and so powerful so seemingly so quickly?

FUNT: A huge piece of it was that they convinced the sports leagues to champion sports betting, which is surprising when you think of the fact that for a century, the leagues were the biggest opponents of gambling outside of Nevada, saying it was an evil that would destroy sports. That's something you heard commissioners saying barely a decade ago.

What I found in my book was that as this case that eventually went to the Supreme Court to strike down that federal ban was being argued in appellate courts at the federal level, representatives of the gambling industry were meeting secretively with the leagues. In those meetings, the industry explained this would make so much money for the leagues, not just because of all the partnerships they would sign with gambling sponsors, but because of the indirect revenue they would get from their TV audience growing so much.

So for the NFL, for example, the most popular league to bet on in these meetings, they learned that the study suggested that between the direct revenue and the indirect revenue of legalization were to take place across the country, the league would make more than $2 billion every year. And as multiple people put it, that was just too good to pass up.

BRODIE: Yeah, I would think that for any league or you reference, you know, states looking to legalize this as a way to bring in revenue, I would imagine it would be awfully difficult to turn down that kind of potential revenue.

FUNT: It would particularly for, you know, the NFL just said, it makes so much money. They eventually got on board, but they were actually a little delayed. It was the NBA and Major League Baseball who were at the forefront of this 180. And it's noteworthy because last season, two players on the Cleveland Guardians were indicted for allegedly fixing specific pitches.

BRODIE: Well, does it seem as though there's any appetite to scale this back? I mean, you referenced the Guardians pitchers. There's, you know, a not insignificant scandal in the NBA. College basketball had point shaving issues in the past.

Does it seem as though now that the toothpaste's out of the tube, like, can you squeeze it back in somehow?

FUNT: You can, because there's so much to determine, short of prohibition, whether it's restrictions on ads, on the types of bets you can place that tend to lead people toward compulsive behavior. On industry practices that I learned so much about talking to people in the business who say these companies can target the most vulnerable customers and exploit them in pretty ruthless ways.

All of that is grounds for more stringent regulation. As for what will trigger that, I give a lot of weight to what I heard from former major league Commissioner Fay Vincent, who passed away a couple of years ago. I spoke with him shortly before his passing, and he said he doesn't think that the moral argument would win out, that people would grow shocked by the public health crisis that was unfolding or on how much money people are losing. He thought that the threat to the integrity of sports is what would move the needle.

BRODIE: I want to ask you about another aspect that you looked into for your book, which is sort of the information that we get as information consumers, whether or not we're placing wagers on games.

And it seems as though the fact that sports gambling is legal and that there are so many agreements and deals between news organizations reporting information and the sports books maybe has an impact on what kind of information we're seeing.

FUNT: I devoted a whole chapter to sports media's embrace of gambling, for one, just because it's just as shocking as what has the 180 that the leagues did. But I also thought it was important because it could have a chilling effect on what sports journalists are covering.

I heard from people who've worked at ESPN, at all sorts of prominent sports media outlets that the enormous amount of money in advertising that's being spent in sports media is causing people to bite their tongues when they are considering covering something that could be embarrassing for the sports books or embarrassing for the leagues for doing business with the gambling industry.

As one person put it, it's as if sports media is being bribed by all this advertising. And that as a journalist, I find really concerning.

BRODIE: I wonder, as you were reporting this book and talking to more and more people, what surprised you the most?

FUNT: Yeah, I would say two things in particular. One was just I expected a lot of people in the industry who I talked to to be very defensive, and I encountered some of that. But to hear those people say things are getting out of hand, we shouldn't be allowed to be exploiting people in the way we are, whether it's with misleading ads or certain targeted marketing, or the way that we don't intervene if we have a feeling someone has a gambling problem. I did not expect to hear that from people in the industry.

And the other thing that really shocked me was there's this whole side of the business that caters to so called VIP customers, people losing thousands of dollars every week, and often much, much more than that. And you know, as an occasional $10 or $20 better, I just had no idea what that's like.

And the unbelievable privileges that those customers get, whether it's throwing out the first pitch in a Major League Baseball game or having your kids get to take batting practice on a Big League field or play pickup basketball in an NBA court. It's also the most dangerous because you're using all those perks to egg on just a unbelievable pace of betting.

And if they, if a customer shows signs of, "hey, maybe I'm, this is getting out of control." There's so much pressure. I learned to look the other way that I found so alarming in that whole side of the business. My jaw was open as I was hearing people tell me about it.

BRODIE: Yeah, I can imagine.