Annual revenues for Major League Baseball (MLB) and the National Basketball Association (NBA) have the potential to increase by $1.1bn and $585m, respectively, due to widely available, legal, regulated sports betting, according to a new Nielsen Sports study commissioned by the American Gaming Association (AGA).

The study analyzes the revenue streams that legal sports betting could generate for both professional leagues: revenue as a result of spending from betting operators on advertising, data and sponsorship, and revenue generated as a result of increased consumption of the leagues’ media and products.

According to Nielsen, greater fan engagement and viewership could boost the two leagues’ total annual revenue from media rights, sponsorships, merchandise and ticket sales, producing $952m for MLB and $425m for the NBA from increased consumption of their products.

“The four major sports leagues will earn a collective $4.2bn from widely available legal sports betting, further proving that working together with the gaming industry will pay dividends for all sports stakeholders,” said Sara Slane, senior vice president of public affairs for the AGA. “Legal sports betting will also create substantial opportunities for state and local economies, generating tax revenue, jobs and supporting small businesses across the country.”

AGA recently released revenue projections for the NFL and NHL, showing that those leagues and teams stand to gain $2.3bn and $216m, respectively, from widely available, legal, regulated sports betting.

This latest research shows that legal sports betting could help generate additional revenues of $160m for the NBA and $154m for MLB as a result of spending by betting operators and data providers. The study projects that gaming operators may spend $64m on MLB advertising and $57m on the NBA – which may directly increase the leagues’ rights fees by the same amount. Sponsorship revenues from gaming operators would provide an additional $78m for the NBA and $62m for MLB. The NBA and MLB are also projected to earn $25m and $28m from data rights, respectively.

SBC Americas analysis:

The big numbers arising from newly regulated sports betting continue to roll out, with the major sports leagues looking set fair to gain significantly from greater fan engagement and spend. While the AGA’s figures are projections – and ought to be regarded judiciously as such – they lend weight to the association’s standpoint that the leagues should be concentrating on securing commercial deals rather than fees written into law to achieve a slice of that growing revenue. Essentially, that means more hard work for league bosses to ensure some of that projected income feeds back up the chain from their members. But no-one ever said it was going to be easy!