No longer conducted in smoky backrooms by colorful and shady characters straight from a Damon Runyon novel, sports betting is a multi-billion-dollar global gaming enterprise legitimately conducted by some of the world’s most respected sports wagering and gaming companies.

While most of the world has enjoyed a multitude of sports and event-wagering options for decades, such was not the case in the U.S., where betting on professional sports was limited to just a handful of jurisdictions, such as Nevada. This was because of the highly restrictive Professional and Amateur Sports Protection Act (PASPA). However, in May 2018, the U.S. Supreme Court ruled that PASPA was unconstitutional. This opened the sports-wagering floodgates across the country, with many states throwing their hats in the ring eager to cash in on the unbridled expansion of U.S.-based sports wagering opportunities.

OPERATIONAL & REGULATORY CHALLENGES

However, today’s sports wagering operations are increasingly complex, dynamic and people-driven enterprises that, to the untrained eye, offer a mind-boggling array of betting options and human interactions that make running them successfully a unique challenge for even the most experienced operators. That’s why it’s essential for operators, suppliers and regulators to fully understand the myriad of complexities and potential pitfalls this unique form of gambling presents.

The world of sports wagering is high frequency, highly transactional, prone to exceptions and dependent on external feeds for stats and pricing that results in almost constant adjustments to betting lines. Unlike the static “plug-and-play” nature of a typical slot machine which can be regulated, tested and certified with comparative ease, to the untrained eye the modern dynamic sportsbook operation appears to teeter on the brink of constant chaos. When someone plays a hand of blackjack or drops some cash into slot machine, an operator doesn’t have to know their betting history, their Social Security number, their home address, whether they represent an illegal betting syndicate or even if their wager will be taken because the odds may be too much in their favor.

Moreover, the front-end operation and the back-end trading platform that are the modern sportsbook’s core technology must operate seamlessly. These systems, where wagers are created and managed, are highly dependent on such things as adjustments, overrides, event cancellations, schedule changes, rain delays, rejected/canceled wagers and a dizzying array of other variables. They are run by experts with years of experience knowing how to appropriately price sporting events. This skillset is not easily learned, as there are literally thousands of variables to account for.

From a regulatory perspective, there are several factors that must be determined when looking at implementing a sports wagering operation. For example, how will the sports wagering be distributed? Will sports wagering operations be limited to land-based venues, such as traditional sportsbooks, or will they be licensed to online operators or both? Will the operation be licensed to commercial casinos or operated by the state regulatory body or both? Additionally, these methods of distribution can range from a traditional retail environment to self-serve kiosks to in-venue mobile betting where players can connect to the Internet, but only within a limited geographic range within the physical establishment.

Then there is the rapid expansion of mobile wagering, which presents its own unique regulatory and operational challenges. This dynamic betting environment changes minute-by-minute, meaning that oddsmakers must constantly digest new information and move the betting line for these isolated events within the game. In addition to the rapid-fire nature of mobile sports betting, operators and regulators must also consider several practical applications as well. Will a sportsbook, for example, allow mobile wagering only within the immediate vicinity of the physical sportsbook? Geofencing technology provides the technical methodology to limit or restrict wireless access within permissible boundaries. But there needs to be clear regulatory guidance as to the extent of these limitations.

EASING IMPLEMENTATION

Sports betting operators, suppliers and regulators who are facing this uncharted territory of sports wagering, therefore, need a comprehensive guide that will illuminate a path toward successful implementation of sports wagering both in the U.S. and around the world. Fortunately, there is just such a solutions-based roadmap for navigating this undiscovered country. It’s called GLI-33.

GLI-33: Event Wagering Systems is a technical standard developed by GLI in response to global industry demand for a clear and cohesive technical standard for sports/event wagering systems designed to help regulate and/or implement legal wagering on sports industrywide. Released in August 2018, GLI-33 establishes a clear foundation of requirements that cover the core regulatory objectives established by the global community of operators, suppliers and regulators. Once this regulatory foundation is established in a given jurisdiction, gaming and technology suppliers can then submit their sports wagering devices and systems to GLI’s laboratory to be tested and evaluated against those specific criteria; confirming from an independent source that the sports wagering product performs as expected and is compliant with the regulations.

GLI-33 addresses many of the key issues facing operators, suppliers and regulators when contemplating establishing sports wagering operations. It eliminates subjective criteria in certifying event wagering systems and sets forth best practices for point-of-sale, self-service and remote-wagering devices. Additionally, GLI-33 covers such critical areas as player account management, wagering rules, system security, operational reports and risk management, including suspicious wagers, player collusion and anti-money laundering (AML) procedures.

Moreover, the GLI-33 standard, as with all GLI standards, was deliberately written to easily accommodate future evolutions in technology. While many regulatory bodies across the U.S. may choose GLI-33 as a starting point for developing their own robust set of governing rules and regulators, it can be adopted “out of the box” in its entirety to give regulators a fully functional set of technical guidelines developed in consultation with the global community of operators and regulators.

EXPERIENCED HAND

For nearly 30 years, Gaming Laboratories International (GLI) has been at the forefront of helping operators, suppliers and regulators around the world develop successful sports wagering strategies. GLI tests and certifies a wide variety of sports wagering, including online, non-sports event-based wagering, fixed-odds betting, pool betting, parlay betting and betting exchanges. This testing assures that wagers made online for events comply with appointed jurisdictional standards and that these wagers are accepted in a fair and secure manner.

GLI’s testing of sports wagering systems also assures that all wagers placed are correctly resolved and paid on the correct odds and rules corresponding to the game or event. Additionally, GLI’s veteran team of experts help to ensure the integrity of the betting process and that appropriate mechanisms and controls are in place for adherence to technical requirements associated with the handling of wager disruptions, cancellations, abandoned events and refunds. Both front-end and back-end wagering activity are analyzed to confirm a complete and accurate log of transactions, performance and payments for regulatory, taxation, player disputes and other purposes.

GLI’s extensive sports wagering knowledge, technical capabilities, and expertise also help ensure that the platform functionality, payment and third-party integration of sports wagering operations will successful right out of the gate.

Additionally, GLI has also been at the vanguard of pioneering testing for Daily Fantasy Sports (DFS), including developing a unique service for fantasy sports applications which does not depend on the historical performance of actual fantasy players; allowing for such analysis to take place even before new games come to market. SBM


Get into the game with the sports betting experts at GLI, a leading sports wagering test lab and consultant. For more information or to download part one of GLI’s Sports Betting White Paper, please visit gaminglabs.com/sbwhitepaper1.