Casinos lost $2.6 mil on Super Bowl betting but somehow the industry will recover - Friday 15th of February 2008

News flash: Nevada casinos can actually lose money.

For only the second time since the state started reporting Super Bowl figures in 1992, Nevada sports books posted a net loss on their biggest single betting day of the year.

Nevada casinos lost $2.6 million on Sunday’s Super Bowl matchup between the New England Patriots and the New York Giants. The game generated $92.1 million in wagers. (In 1995, casinos lost $400,000 on the Chargers-49ers game.)

Gamblers bet early and often on the underdogs and the underdogs won. Many bet the Giants on the money line, to win, at nearly 4-1 odds, Golden Nugget race and sports book director Tony Miller told my colleague, Sun sports reporter Rob Miech. “We had a winning day, a small one, but I guess we were one of the lucky ones,” Miller said.

“That’s the culprit right there,” said Jay Kornegay, executive director of race and sports at the Hilton. “There was a lot of small support on the Giants. There wasn’t enough bet on the Patriots to overcome those 4-1 odds.”

Ideally, sports books want to take in an equal amount of money on both sides, making money on the bookmaker fee.

What’s more surprising is that only $92.1 million was wagered on Sunday’s game, falling short of last year’s $93.1 million in wagers and short of the hoped-for record of $100 million.

Even Gaming Control Board analyst Frank Streshley isn’t sure what happened on that front, especially given that both teams have large fan bases and compelling stories going into the big game. The softer economy may have played a role, Streshley said.

Miller said he wasn’t all that surprised.

“I had a funny feeling,” he said. “It just didn’t live up to the hype at all. I was waiting for it to pick up, but it didn’t seem as busy as last year. I was disappointed.”

Kornegay told Miech he was surprised that the record of $94.5 million was not broken, based on the traffic at his property. “And those TV ratings, being the most-watched Super Bowl in history,” he said. “I thought all that would have added up to at least beat last year’s handle.”

But don’t feel too sorry for the Strip. The Las Vegas Convention and Visitors Authority estimated that Las Vegas visitors spent some $116.3 million on everything besides gambling over Super Bowl weekend, up from $110.7 million a year ago.

Those beers, chicken wings and shopping sprees (for significant others who couldn’t care less about the game), really add up.

Sports wagers make up about 1 percent of Nevada’s gambling revenue, with football accounting for about 40 percent of them.

No doubt pundits will trot out the increasing insignificance of Nevada sports books relative to the ballooning action on illegal, offshore Web sites. And no doubt you’ll hear estimates that Nevada books account for a paltry 1 percent of the hundreds of billions of dollars bet globally on sporting events. The problem with such comparisons is that numbers are nearly impossible to confirm. Since the government’s crackdown in recent years, illegal online sports betting has been driven further underground and figures, in many cases, are private.

Sports betting, in spite of all that you’ve heard, is not a hugely profitable business. The corner bookie, whether he be in Costa Mesa or Costa Rica, is going to be looking at slim margins year-round. Nevada sports books’ average win percentage (the percentage of bets kept by the casino) is about 5 percent – less than table games and popular slot machine titles.

The real money, for many Strip resorts, has nothing to do with gambling.

Save your pity for New England fans.

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