Why Aren’t States Using The New Jersey Sports Betting Model?

New Jersey has given the US an easy-to-follow blueprint to online gambling and sports betting success. The Garden State has benefitted from the added tax revenue brought it via NJ sports betting, its operators have seen revenues and player lists bolstered, and the consumer now has a safe, well-regulated place to wager.

Yet many of the states that have followed New Jersey and dipped their toe into legal sports betting and online gambling have decided to ignore successful models like New Jersey.

This regression has flustered many. If New Jersey can get it right, why can’t you?

The answer can be found in history.

Progress Isn’t Always Linear

The pyramids of Giza are a wonder of both the ancient and modern world. They’re that impressive.

But what’s relevant to this conversation about the three best-known pyramids is where they fit into the pyramid-building timeline. There were some pyramids before them, and many more pyramids after, but it’s these three that represent the height of pyramid building in Ancient Egypt.

The Early Pyramid Era

The efforts before the Pyramids of Giza were what you would expect, a lot of trial and error.

There’s the Step Pyramid of Djoser. The Step Pyramid is believed to be the first attempt at pyramid building in Egypt. It started as a somewhat typical mastaba tomb, although it was stone and nearly-square rather than rectangular. Whether a planned construction or a result of Djoser’s lengthy reign, the complex was continually renovated, with new, smaller mastaba layers added, creating the stepped pyramid shape.

The next era of pyramids belongs to one Pharaoh, Sneferu. First is the pyramid at Meidum that suffered several collapses before being abandoned. Next is the so-called Bent Pyramid, which had its angle altered halfway through construction, conceivably to prevent a Medium-like collapse. And finally, there is the Red Pyramid, the first “true” pyramid and Sneferu’s tomb.  

The Golden Age of Pyramids

Using Sneferu’s pyramids as a blueprint, his successors gave us the three well-known Pyramids of Giza. There’s the Great Pyramid of Khufu; Khafre’s Pyramid, which appears to be the largest, thanks to it being built on higher ground; and the Pyramid of Menkaure, which was much smaller but as finely built and adorned.

The Decline of Pyramids

But then something altogether unexpected happened, instead of better, or even on-par pyramids, Egyptian Pharaohs started building lesser pyramids. They used cheaper materials, took shortcuts during construction, and built on a smaller scale. It was as if they decided to ignore the successes of Sneferu, Khufu, Khafre, and Menkaure.

There are plenty of logical reasons for this, including economics and available material and labor. Still, one key factor had to be that a Pharaoh’s reign wasn’t always long enough to complete their tomb. That’s particularly true if it’s a massive stone pyramid, evidenced by several unfinished pyramids during the early pyramid era.

I’m sure every subsequent Pharaoh wanted to build their own “great pyramid,” but for whatever reason, they felt it was unattainable, so they settled for a lesser pyramid.

Online Gambling and Sports Betting

And that brings us back to the modern age, to legal sports betting and online gambling. New Jersey wasn’t the first jurisdiction in the US with legal online gambling or sports betting. It was one of the first, but it also borrowed heavily from other jurisdictions around the globe. As such, the state feels like it’s the industry’s Great Pyramid, the pinnacle of what good legislation looks like.

Sneferu learned several construction lessons, from the type of ground to build on to what stone to use to corbel arches to the most structurally sound way to lay the stones. Armed with that knowledge, his successors didn’t make the same mistakes.

Similarly, New Jersey learned from European and US locales. It built what I consider the best online gambling and sports betting model – under the constraints of the US legal online gambling system. And unfortunately, it’s a marvel no one has replicated on the same scale.

New Jersey didn’t overly limit the market. It didn’t burden operators with excessive taxes and fees. And it didn’t restrict player access by prohibiting online registration. Yet most states legalizing sports betting or online gambling have made one or more these missteps.

What’s the Reason for the Decline?

The question is, are these “mistakes” due to ignorance, negligence, and/or corruption, or are they merely a reality of the state’s situation?

I won’t write off a combination of ignorance and negligence, or a smattering of corruption, but like the pyramid builders after the Golden Age, states have to work with what they have. It’s not necessarily about, “can I build a pyramid as nice as New Jersey’s?” Instead, it’s, “can I build a pyramid that’s better than having no pyramid at all?”

Some states have selected monopoly models or otherwise limited the market. Maybe they lack a competitive land-based market or look at their lottery’s successes as reasons for taking that approach.

Other states have imposed high tax rates and additional burdens on operators. But those states are mainly looking for an influx of money through expanded gambling.

Many markets have imposed limitations on where players can bet and register their accounts. Sometimes its implemented to avoid legislative hurdles like constitutional amendments. Other reasons include existing gambling’s influence over the legislative process, or the legislature concluding (with input from gambling operators) that they don’t need a pyramid.