MA regulators opt to prohibit affiliate rev share deals

Hand pulling a piece from a pie with a percentage symbol on it, representing revenue share
Image: Shutterstock

The 45-day trial window for Massachusetts sports betting affiliate deals is still in effect, but once it concludes, the majority of revenue-share affiliate deals will be prohibited. The Massachusetts Gaming Commission met Monday to approve regulations that would allow cost-per-acquisition affiliate deals but drastically limit the scope of alternative revenue agreements.

The approved regulation now reads:

“No Sports Wagering Operator may enter into an agreement with a third party to conduct advertising, marketing, or branding on behalf of, or to the benefit of, the licensee, in exchange for a percentage of net sports wagering revenue earned from users that the third party directs or causes to be directed to the Operator.”

What that essentially means is that deals in which the total revenue generated by an operator split among affiliates would be okay, however, any deals in which a percentage of the amount of revenue generated specifically by the affiliate or partner would not be allowed.

Some commissioners, Commissioner Eileen O’Brien in particular, voiced concerns about responsible gambling if an affiliate marketer is incentivized to get customers to spend more with a site. Commissioner Nakisha Skinner, on the other hand, was worried banning all revenue share agreements would have an outsized impact on small and minority-owned businesses.

The compromised language allows for some agreements beyond the standard CPA but also limits the scope of what kinds of revenue share deals are available. These new rules should go into effect when the exemption expires on April 14.

Another change to the affiliate rules will also require sportsbook marketing affiliates to overtly state both that they are advertising for a sportsbook and to disclose which sportsbooks they have deals with:

“Any advertisement or promotion for Sports Wagering shall disclose the identity of the Sports Wagering Operator and whether a financial relationship exists between any Person providing an endorsement or promotion and the Sports Wagering Operator.”

Many affiliate sites acknowledge the content may be impacted by financial relationships but an explicit list of which operators they work with is not a common practice.