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Arguments were made that eliminating affiliate marketing would lead to mass-market advertising from black-market sports betting operators. And stunt the ability to share responsible gaming information. Last week, diverse legal sports betting stakeholders urged the Massachusetts Gaming Commission to change a regulation ahead of its projected March 10 digital launch.
The MGC appears to be pointing toward amending the rule to allow for Cost Per Action (CPA) deals between affiliates and operators. Affiliate marketers work under either CPA deals, through which they are paid per customer acquired through an affiliate partner or revenue share agreements.
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Commissioners asked their legal team to develop options to amend the regulation, which currently bans partnerships between operators and affiliates. The commission decided to juggle its schedule to address the regulation.
Only two legal U.S. jurisdictions, Connecticut and Illinois, currently have restrictions on affiliate partnerships, and none ban them outright. Connecticut regulations prohibit partnerships that include the CPA model, and Illinois regulations prohibit deals based on revenue sharing.
Better Collective, Catena, and CDG (Gambling.com) to lobby for a change to Regulation 256. The main discussion points were how affiliates provide a service by educating and informing consumers, that they only market to those already interested in participating in wagering, and that banning affiliate partnerships would ultimately give rise to the black market.
Seven digital operators are poised to launch in Massachusetts on March 10, meaning there is a tight timeline for a decision, as operators and affiliates must solidify deals and complete other administrative tasks before the partnerships are active. The three media companies that participated have deals with many major operators in other jurisdictions.
Operators are already taking action based on the regulation as written. Caesars Sportsbook has sent a letter to affiliates saying that it will not work with affiliates in the market given the current ban.
Executives from Better Collective, Catena, and CDG collectively said that CPA deals account for about 90% of their deals, in part because those types of deals are “easier to track,”
Commissioners discussed the possibility of altering the rule to allow CPA advertising but potentially continuing to prohibit revenue-share models. While the operators at Monday’s meetings would be amenable to such a compromise, it seems clear that smaller companies, like Betr —approved for a standalone mobile license in Massachusetts — could be disadvantaged in that scenario.
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