Wednesday, February 10, 2010

More on Super Bowl Betting Profits 

Here's a brief follow up on my Sunday night post on how much money sports books made on Super Bowl wagering. I pointed out that, based on the volume of bets placed on the sides and overs at offshore sports books, Super Bowl betting was profitable for sports books. The Nevada Gaming Control Board put out an information release on Tuesday detailing the returns to the 182 legal sports books in Nevada. $82.7 million was bet on the Super Bowl, and Nevada sports books earned $6.8 million, for a 8.3% return.
Year Volume Won by Books Return Game Results
2010 $82,726,367 $6,857,101 8.3% Saints 31 Colts 17
2009 $81,514,748 $ 6,678,044 8.2% Steelers 27 Cards 23
2008 $92,055,833 $(2,573,103) -2.8% Giants 17 Pats 14
2007 $93,067,358 $12,930,175 13.9% Colts 29 Bears 17
The rate of return is quite variable, but the only year sports books lost money on Super Bowl betting in the past few was when the Giants upset the Patriots. The patriots were 12.5 point favorites in that game, and the bet volume was 61% on the Giants and 39% on the Patriots. The over/under was 55. Sports Illustrated reports that some books lost money because of proposition bets ("props") that paid off on the game. Prop bets typically pay long odds for rare events, and the two that hurt sports books were the two point conversion prop and the "pick six" (int returned for a TD) prop. Update: No idea why Blogger insists on adding that whitespace before the table. Grrr.

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permalink posted by Brad Humphreys @ 4:33 PM

Sunday, February 07, 2010

Super Bowl Wrap Up 

The Saints beat the Colts 31-17 for their first Super Bowl victory. It was a thrilling win, with the outcome in doubt until Tracy Porters' 74 yard "pick six" with 3:12 left in the game and the Colts driving for the potential tying score.

The other big winner in this game was sports books. Evidence shows that bettors love two things: favorites in point spread betting and the over on total betting. According to sportsbook.com, as of about 4pm Eastern on Sunday the line was the Colts -5 and the over-under was 57. Based on action at off-shore sports books, 63% of the sides betting was on the Colts, and 66% of the totals betting was on the over. The Colts didn't cover, and the 48 point total was well under 57. Given the bet-110-to-win100 payoff structure on sides and totals, and the fact that the Super Bowl is the most popular sporting event to bet on all year, that translates to a big payday for sports books.

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permalink posted by Brad Humphreys @ 10:19 PM

Monday, February 01, 2010

Football vs. Football 

While the United States is focused this week on the Super Bowl, a report released today by the consulting firm Initiative states that soccer's Champions' League Final attracted a higher global television audience than the Super Bowl last year. 109 million viewers watched the game in its entirety, eclipsing for the first time the 106 million fans who watched the Super Bowl . Given the worldwide popularity of the game of soccer, the report also noted that the Champions' League Final also had substantially more room to grow.

While America's premier event may have lost its perch atop the worldwide television ratings, the Super Bowl still dominates its competition when it comes to inflated economic impact statements. The NFL claims the 2007 Super Bowl generated $463 million in economic impact for the South Florida region while the 2008 Super Bowl produced over $500 million for Arizona. By contrast, this compares to a mere 35 million euro ($49 million) windfall for Moscow in 2008 and 45 million euro ($63 million) for Rome in 2009.

Of course, the Europeans aren't trying as hard to justify large subsidies for sports franchises. Either that or American economists consultants are just more talented at making stuff up than their European counterparts.

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permalink posted by Victor Matheson @ 3:19 PM

Sunday, February 01, 2009

Super Bowl Economics 

University of South Florida Economist Phil Porter is referred to here as the "Dr. Doom of sports economics," presumably for throwing cold water on economic impact claims surrounding the Super Bowl. That's what you get for telling it like it is, even if your abode doesn't sport ... unusual wall hangings. Some figures of the mundane variety (and not all that pretty) are here.

In spite of the gloomy reports on the economy, NBC is reporting that advertising revenue will hit a record $206 million for the game. This despite the fact that American car companies will be absent from the ad lineup. Frankly, I prefer the VW ads to the ones for Ford Trucks, and am somewhat heartened that my bailout contribution won't occupy my TV screen during the Super Bowl broadcast.

This report has a several interesting anecdotes on economic impact in Tampa. Most interesting to me was the following:

The Federal Aviation Administration is expecting about 1,000 more small private planes and bigger corporate jets than usual to use Tampa-area airports over the weekend - about the same increase that Phoenix saw for last year's game.

But this year some of those who favor deluxe private air travel may be staying home. Nathan McKelvey, chief executive officer of Jets.com, which books charter flights on private aircraft, said last year he booked 55 trips to the Super Bowl - many of them in premium aircraft with seating ranging from six to 12. This time around, McKelvey has booked 18 trips.

With fewer luxury planes in the sky, there also will be fewer courtesy vehicles - a mix of Cadillacs and Chevys - on the ground in Tampa. That's a reflection of the crunch at General Motors, which cut 14,000 jobs last year.

GM, which recently received $9.4 billion and is scheduled to receive another $4 billion in government bailout money, says it scaled back on the fleet of courtesy cars it makes available to the NFL for the weekend and it decided not to buy a costly in-game ad this year.

"We are cutting the courtesy fleet in half and providing the NFL nearly 200 vehicles," said GM spokeswoman Kelly Cusinato. She also said that although in the past GM hosted a dealer party in conjunction with the Super Bowl, this year "we are not hosting any dealer meetings and no GM executives are attending the game."

That seems prudent. Maybe Donald Fehr should take a lesson from GM rather than John Thain. It's only one quote, but Dave Zirin's interesting piece on sports & the economy quotes the MLBPA Chief as saying: "Historically, baseball has been recession resistant." Fehr could be posturing for the purpose of collective bargaining, or he could be ignorant. Or he could be referring to real output -- i.e. attendance and viewing in general, in the presence of lower ticket prices and player wages. But I don't think so. The 22% drop (annualized) in consumer purchases of durable goods last quarter, along with data from earlier eras, suggest to me that "resistance" could be an ill-timed strategy for baseball players.

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permalink posted by Skip Sauer @ 7:35 AM

Sunday, January 25, 2009

Super Bowl Ticket Prices 

Here's a "Cardinal-centric" discussion of ticket prices to Super Bowl XLIII, with the following - stunning to me at least - prediction:
“We’re going to see close to face-value prices,” said Sean Pate, spokesman for online ticket broker StubHub. “As I click over (to the Web site) every few hours, something cheaper shows up.”
The story reports that the average list price at StubHub was $2552 on Friday, but dropping. A number of non-business cycle factors are cited as factors, including the long run of ineptitude for the Cardinals, and the fact that their fans don't need a trip to Florida to enjoy a bit of warm weather in the winter.

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permalink posted by Skip Sauer @ 1:57 PM