SXSWorld
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2 0 S X S W o r l d | F E B R U A R Y 2 0 1 5 | S X S W. C O M f there is anything that Adam Silver has shown in his short tenure as commissioner of the National Basketball Association, it is that the league that he guides will always be looking forward and thinking outside of the usual profes- sional league box. This has been demonstrated in a number of areas. On the image and behavior front, Silver asserted his views quite publicly when he banned former Los Angeles Clippers owner Donald Sterling from the NBA for life for Sterling's racist remarks. More recently, he took a notably tough stance against domestic violence by players. In addition, he revealed his outside-the-box attitude regarding revenue matters, notably when he recently announced a massive new television and media rights deal. He has also embraced some potentially controversial ideas, such as his indication that the NBA would explore allowing advertising on jerseys. Yet, his most poten- tially ground-shaking stance came when he made it clear that the NBA would embrace legalized sports gambling. At the Bloomberg Sports Business Summit in September 2014, Silver said that it is inevitable that sports betting will eventually be legalized in the United States, and once that happens, the NBA will participate. He noted that embracing legalized sports betting could help the NBA's television ratings, stating: "If you have a gentleman's bet or a small wager on any kind of sports contest, it makes you that much more engaged in it. That's where we're going to see it pay dividends. If people are watching a game and clicking to bet on their smart- phones, which is what people are doing in the United Kingdom right now, then it's much more likely you're going to stay tuned for a long time." Not long after those remarks, Silver penned an op-ed for The New York Times in which, citing the fact that some estimates believe nearly $400 billion is illegally wagered on sports per year in the United States alone, and that there has been increased support both within and outside the country to legalize sports gambling, he wrote: "I believe that sports betting should be brought out of the under- ground and into the sunlight where it can be appropriately monitored and regulated." Silver did list various safeguards the government would have to put in place in order for the NBA to officially support legalized sports gambling, including but not limited to the monitoring and reporting of unusual line-betting movement, minimum-age verifi- cation, mechanisms to exclude people with gambling problems and education about responsible gaming. Still, even with those caveats, Silver's is a far more open stance toward betting than the one his predecessor, David Stern, took for the majority of his 30-year tenure at the league's helm. Silver's Times op-ed was also released the day after the NBA announced a partnership with the daily fantasy sports site FanDuel, which allows players from all over the world to compete in daily fantasy tournaments (with as many as 50,000 entrants or more), one-on-one matchups and "50-50" games (where half the entrants in a tournament win money). FanDuel players build fairly standard fantasy basketball lineups consisting of two point guards, two shooting guards, two small for- wards, two power forwards and one center, all of whom are awarded points based on the statistics they compile in that night's games. Rather than keeping those players for an entire season like many other fantasy leagues, daily fantasy players can go right back the next day and build an all-new lineup, or even enter multiple lineups on the same night. Not only does the league's partnership allow NBA fans to enter FanDuel's daily fantasy contests through links on NBA.com, but it also includes promotional videos on NBA TV and NBA Mobile, as well as advertisements with broadcast partners ESPN/ABC and TNT. As part of the deal, FanDuel also secured partnerships with the New York Knicks and Dallas Mavericks, adding to the relationships the site had already formed with the Brooklyn Nets, Orlando Magic and Chicago Bulls. Meanwhile, the Philadelphia 76ers signed an agree- ment with DraftKings, another daily fantasy site. The recent daily fantasy boon even inspired former commissioner Stern to change his tune and support Silver's push. "Once daily fan- tasy became an acceptable exception to the law against gambling, I think that's gambling, so now I think the best approach would be, as Adam Silver has advocated, is for there to be federal regula- tion," Stern said. "Bring the sports leagues in. If it's going to happen, because it has happened any way by Justice Department rulings and the like, you should make it legal, and you should regulate it as tightly as you possibly can." In addition to those team agreements with one-sixth of the league, FanDuel gave the NBA an equity stake in the company, opening up yet another revenue stream for the league. And that is really what this is all about: finding additional revenue streams. As commissioner, Silver's job first and foremost is to provide value for the owners of the 30 NBA teams. Securing a television deal worth in excess of $2 billion was step one of that plan. It seems obvious that Silver is pursuing many different avenues for present and future revenue generation, one of which may result in legalized betting on professional sports leagues such as the NBA. SX s p o r t s ta kes p la ce Fri d ay , M a rch 13 - Su n d ay , M a rch 1 5 a s p a r t of SX S W I n te r a c t i ve a n d SX S W Fil m . S e e s x s w.co m /co nve r g e n ce /s x s p o r t s fo r m o re d e ta il s . NBA Taking Proactive Stance on Possible Future Gambling by Jared dubin I