Just as AI is affecting sports, it is, perhaps inevitably, going to transform the business of betting on them. We’ve noted previously that the explosion of legal sports betting and the proliferation of sports betting apps has fueled gambling addiction, bankruptcies and job losses. The rapid advance of AI into the gambling sphere could exacerbate all of that. It’s urgent to mitigate the risks through new regulatory safeguards, industry guidelines and ethical standards.
The legal gambling industry has already figured out how to track bettors’ data, know whether they are on a winning or a losing streak, offer various odds, and supply predictions or probabilities of certain outcomes. Advanced AI systems will help sportsbooks do all of that much faster, using bigger data sets, thus creating an individually tailored gambling experience. AI will know your favorite team and players, how much you typically bet, at what times of day and night — and target you with specific betting recommendations.
AI-powered algorithms and machine learning can instantly analyze huge amounts of historical data and statistics in real time. How has a certain baseball player fared batting against left-handed pitchers on overcast days in a specific stadium on Wednesdays? The technology can give bettors predictive modeling instantaneously. That, in turn, might prompt online gamblers to make what they think are surefire bets.
Existing AI tools can now predict certain events with 80 to 90 percent accuracy, according to the tech site TMCnet. “A 90% accuracy means guaranteed profits,” TMCnet said. No more gut instinct bets, just AI-driven statistical probabilities. Those tools are not yet widely available, but they are coming.
Proponents of online sports betting see this as leveling the betting field, giving anyone seated on a couch access to the analytics once available only to professional gamblers. But for those grappling with a gambling problem — estimated by the National Council on Problem Gambling as up to 9 million Americans — it could reinforce the addiction, as bettors wager increasing amounts because they think they have a better chance to beat the house.
In theory, as the gambling industry points out, AI could help combat gambling addictions. It could help identify and track problematic gambling behavior as well as individual at-risk users. Gambling researchers have identified specific “markers of harm,” including changes in the frequency of betting or in amounts wagered, whether a bettor is using multiple credit cards, how often they make deposits into online accounts, and whether any deposits have failed for insufficient funds. Another marker is bettors opening and closing sportsbook accounts, which might indicate they are trying to deal with a gambling problem. AI could work better than current problem gambling initiatives and helplines, which rely on self-reporting.
Gambling proponents say AI can help detect fraud and money laundering by identifying irregular patterns and movements of money. Some also say AI can increase fairness in sports by finding anomalies — “red flags” that might indicate match fixing, or abnormal behavior by a player that could suggest doping or illegal betting.
But the potential benefits of AI depend on the gambling industry policing itself, adopting internal guidelines and AI ethics, and giving more than lip service to the idea of “responsible gambling.” The United States should look to the European Union Parliament, which recently introduced the AI Act to hold companies using AI responsible for any resulting harm. The E.U. plans to set up a new European AI office in charge of regulations and enforcement, which can levy fines against a company’s global earnings. Citizens will also be allowed to file complaints.
In the United States, 38 states and D.C. allow sports betting — and carry primary responsibility to regulate it. This creates a patchwork of law and regulation instead of what’s needed: congressional action at the national level. Rep. Paul Tonko (D-N.Y.), who earlier introduced legislation to limit sportsbook advertising, has drafted a companion bill called the Safe Bet Act. Among other things, it would forbid operators from using AI to track individual gambling habits, provide targeted promotions and generate new products such as micro-bets. The AI revolution in sports gambling is coming fast. Government needs to keep up.