• Investment firm Morgan Stanley estimates that the U.S. sports betting market will reach between $7 billion to $8 billion by 2025.
  • MGM Resorts currently only has an online sportsbook in New Jersey and Nevada.
  • Commercial casinos in the U.S. netted $41.7 billion in 2018.

NEW YORK – The 2019 Sports Betting USA & Investor Summit kicked off on Monday with a bold prediction by respected investment firm Morgan Stanley.

The sponsor of the event predicted that the U.S. legal sports betting industry will reach somewhere between $7 billion to $8 billion by 2025.

While those figures would pale in comparison to the $41.7 billion in revenue that commercial casinos generated in 2018, it would still be a sizable jump from the $883 million generated so far this year by legal sportsbooks.

It would also serve as a new revenue stream for gaming operators across the country. Other industry stakeholders that were in attendance at the NYC Sports Betting Investment Summit, such as representatives from Hard Rock and Mohegan Sun, gave a similar forecast.

However, even with states continuously legalizing sports betting, the space for sports betting operators is limited. Every state that has legalized the activity has set a maximum number of businesses that can operate within their territory, online or within casinos.

“It’s a growing market here in terms of revenue but it’s a tough market,” said Scott Butera, president of interacting gaming for MGM Resorts International. “Everybody wants to be here, ultimately I think we’ll see some shaking out.”

MGM Resorts, which operates the online sportsbook BetMGM, is only available in New Jersey at this time, while playMGM is available in Nevada. There are a total of 16 sports betting apps in NJ and counting. With a market that large, MGM is still doing fairly well judging by their revenue share last month.

When asked about Morgan Stanley’s prediction, Butera added: “I’ll take the over on $8 billion.”

Morgan Stanley provided an even higher estimate if all 50 states were to legalize wagering on sports. In that scenario, the company estimated the market could reach $15 billion in revenue. However, the likelihood that all states will sign sports betting into law seems slim.

So far 17 states have legalized sports wagering in some capacity or another. Some states allow statewide mobile betting while others limit the activity to inside certain casinos. Only allowing land-based sportsbooks to operate would severely limit the amount of revenue that could be generated by sports betting.

In New Jersey, roughly 80% of all sports wagers made each month are done so through a mobile device. However, the amount of revenue generated from legal sportsbooks across the board continues to grow steadily ever since the repeal of PASPA in 2018.

Depending on how bills are written in the next states that try to legalize sports betting, Morgan Stanley’s prediction could be spot on.

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