The growth of esports worldwide has led to the frequent staging of tournaments that can attract tens of thousands of people, and the desire to bet legally on the games is expected to continue to grow in popularity as it has for other sports.
As states begin to consider regulations, and American casinos weigh the opportunity to monetize esports tournaments by taking wagers on it, legal experts are expressing their concerns over protecting the integrity of the games – and considering options for how that can be done.
That was the focus of a discussion Monday at the Global Gaming Expo, where a panel of lawyers and gaming advisors discussed “Esports and Its Growing Market for Millennials” in front of an overflow audience.
“From a bookmaking perspective, one of the issues is: it a fair game, like every other sporting event?” said John English, a partner and managing director of sports betting and technology with Las Vegas-based Global Market Advisors.
Other sports have had their scandals over the decades, he said, but esports needs to be closely looked at because the sport’s development is outstripping regulations.
“There really aren’t a lot of rules in place yet,” English said. “One of the big concerns is testing the software. We live in an age of hacking… even Facebook and (other) massive companies can be hacked.”
Bookmakers would have to be satisfied with the software, which takes time to test. The question is whether publishers of the games used in the competition provide a test copy to gaming labs, he said.
“I am not so sure that is going to happen immediately, and I’m not sure it will ever happen,” English said. “I often wonder whether or not gaming needs esports more than esports needs gaming.”
The integrity concerns center on match fixing, English said. For example, a player could intentionally play poorly, or use drugs to increase focus.
“These are things we worry about in all forms of gaming. There is no reason we shouldn’t consider it as well with esports,” he said.
“We need to have that before we start taking lots of bets on (esports).”
Jessica Maier, a gaming attorney with the German law firm Melchers, said esports can be viewed like other sports. Every game is separate, she said, and the rules of the games sometimes change when there’s a new version, which could affect any already-implemented integrity measures.
“They will need to be changed again… that will (take) quite an effort,” Maier said.
Bahar Alaeddini, an attorney with London-based Harris Hagan, which specializes in gaming law, argued that esports shouldn’t be viewed as a single discipline because there are more than 80 types of games.
“(So) there is no central governance or regulation,” Alaeddini said. “Regulation is a good thing. It obviously has its downside, and it struggles to keep up with innovation, but the risk posed to young people and vulnerable adults needs to be addressed. It poses a risk to the general licensing of gambling regulations.”
Esports need to take their lessons from other sports, which Alaeddini said haven’t been good at governance and maintaining integrity standards.
The United Kingdom has the Esports Integrity Coalition, which Alaeddini said is becoming an international organization committed to the integrity of esports. The problem right now is that it “doesn’t (really) have teeth,” she said.
“The publishers aren’t interested in the regulation and integrity of their titles because they generally don’t agree with any overarching integrity program,” Alaeddini said. “There are concerns about doping and match fixing, which are common for sports. But there are other critical threats… software cheating, (third-party) attacks to slow or disable a program.
“Unless all the game publishers will come together with the Esports Integrity Coalition or another international organization, we’re going to have a very fragmented approach, and esports (will not be able to) protect itself.”
Panel moderator Jennifer Carleton, an attorney with the Las Vegas firm Howard & Howard, mentioned that American sports leagues are pushing for sportsbooks to pay an integrity fee on bets placed on their sports – a fee that would cover the cost of data books use to grade bets.
She wondered something similar could be set up to offer a financial incentive for game publishers to come to the table.
“League fees don’t work in the model of sports betting, whether its esports, the NFL or NBA,” said English, who joked that the sports should pay bookmakers one percent instead, for adding to their popularity. “It’s a very high volume, low margin business.”
Alaeddini said while betting operators have a strong vested interest in integrity, people should look to esports sponsors such as DHL, Coke, Audi, Mercedes Benz, and MasterCard.
“Those three stakeholders have the biggest role to play and the most influential roles to play in supporting positive integrity,” Alaeddini said.
“I don’t think tournament organizers will be willing.”a
