Baseball Lockout Could Put $550 Million Dent In State Gaming Revenues
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SAN DIEGO – “Tax” is a four-letter word in New Hampshire. Legislators from the “Live Free Or Die” state prefer to call money appropriated by the government as “revenue.” New Hampshire, and the other 37 states that currently offer legal sports betting, face a revenue hit if baseball’s owners lock out players next year.
Dark clouds hang past the horizon this week in Philadelphia, where Major League Baseball celebrates its annual All-Star Game and America’s 250th Birthday Tuesday night.
Many players, owners, and fans all expect a lockout to begin with the current collective bargaining agreement between players and owners expiring on December 1. The early battle lines in this baseball's labor and litigious revolution remain well-defined.
In this revolution, the regal MLB owners aim to impose a salary cap following the path of the NFL, NBA and NHL. The rebellious players remain entrenched in their opposition.
Think Bunker Hill. Or perhaps Yorktown. Depending on your chosen side.
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Baseball Betting Generates Real Revenue For States
MLB has yet to lose any games due to labor issues since the Supreme Court overturned PASPA in 2018, opening the door for nationwide sports betting.
Betting on MLB outcomes (including props and parlays) accounts for roughly 15% of the total US sports betting handle and revenue. In May, states collected more than $258 million in taxes from sports betting revenues nationwide. Last year, $168 billion was wagered online or at retail sportsbooks in the U.S. and operators paid $3.683 billion in taxes to states.
That means states could potentially lose more than $550 million in revenue if there's no baseball in 2027.
In 2025, the Los Angeles Dodgers were the most-bet team on FanDuel, Fanatics, and DraftKings. Those books own roughly 80% of the U.S. market share. The Dodgers played 179 games in 2025, including the postseason, en route to their second-straight World Series title.
So it’s clear the states could be in for financial hit if baseball’s owners and the players union cannot come to a deal on a new CBA by next spring.
Korean Table Tennis & Minor League Baseball To The Rescue?
“During COVID, Korean Table Tennis saved sports betting,” New Hampshire Sen. Tim Lang told Bookies.com during the National Council of Legislators From Gaming States meeting here. “Everyone was betting on that because that’s what they wanted to do. You’d like to think that as one thing drops off, another thing will pick up and you’ll see some elasticity happening in the market. There will be another sport – maybe pickleball - that will come up. The market adjusts when there’s a gap in one area, they’ll pick it up in another area.”
DraftKings enjoys a monopoly in New Hampshire, where the state “revenues” DK's net profits at 51%. New Hampshire boasts a solid sports-betting pedigree and ranks No. 3 in the nation per-capita when it comes to sports betting revenue.
“You're going to see a reduction and states will have to deal with that,” Lang said. “Again, it'd be a one-time incremental thing. Once you get used to it, now it's the new standard.”
The losses may not be just in terms of revenue, but in terms of customers
“Korean table tennis was our number one betting during COVID. And that wasn't a joke. The market will find if people want to bet on something, they'll find something. My concern is that they move to a prediction market,” Lang told Bookies.com. "My concern is that without major league baseball during the summer and having a gap in that sport that people will move to a prediction market for something else.”
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4 MLB Teams Claim Turf In Ohio
Ohio sports betting generated $10.2 billion in total handle in 2025 and $1.04 billion in state revenue. Ohio serves as the home state for the Cleveland Guardians and Cincinnati Reds. Its baseball fandom includes fans of the Detroit Tigers in the northwest part of the state near Toledo, and Pittsburgh Pirates in the eastern environs around Youngstown.
Sen. Bill DeMora agrees with Lang that other sports will fill any absence created by a baseball lockout. Perhaps led by minor-league baseball in his state. Minor-league players operate under their own CBA. Thus, they remain unaffevted by any stoppage between MLB and the MLB Players’ Associated. Betting on minor-league baseball is allowed in multiple states, including Ohio.
“It's going to affect the overall market, but I do think people will find someplace to bet. Are they going to bet more WNBA games? Are they going to bet more soccer games? Will they just move their bets away to what's offered or not?” DeMora told Bookies.com. “With the minor leagues, I think that's what people are going to do is going to start betting what they can bet.”
Prediction Markets Could Siphon Customers During MLB Lockout
This year through May, Ohio sports betting operators have generated $87 million in revenue for the state off more than $439 million in winnings.
The Ohio Casino Control Commission and Kalshi remain embroiled in legal battle that may find its way to the U.S. Supreme Court. The case hinges on whether the Commodity Exchange Act pre-empts Ohio gaming regulations. Oral arguments will take place in the U.S. Courts of Appeals for the Sixth Circuit on July 30.
“Predicted markets are sports betting and they ought to be regulated and taxed or just completely outlawed. We have to be prepared for both of them,” DeMora said. But he does share the concern that prediction markets could well siphon off customers who might have been happy betting baseball otherwise. “We’re losing revenue and they’re not paying the fees. We’ve got to do something because (all the states) are losing out on $300 million to $400 million a year in revenue.”
Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) Call 877-8-HOPENY or text HOPENY (467369) (NY) Call 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR), Call 1-800-NEXT-STEP (AZ), 1-800-522-4700 (KS, NV), 1-800-270-7117 for confidential help (MI). 21+ only. Please Gamble Responsibly. See http://BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable and Expire in 7 Days. In partnership with Kansas Crossing Casino and Hotel. This promotional offer is not available in DC, Mississippi, New York, Nevada, Ontario, or Puerto Rico.
Baseball’s Loss Could Be iGaming’s Gain
Both DraftKings and the Red Sox call Massachusetts home. Any baseball stoppage could impact the Bay State harder than most.
“The events and leagues with the most viewers also have the most betting interest. Massachusetts patrons have shown that interest in betting on the MLB and the chance of another Red Sox World Series,” Massachusetts Gaming Commission Chair Jordan Maynard told Bookies.com.
In May, the Bay State took in $14 million in sports betting taxes on a handle of $632 million.
The possibility of a baseball lockout and lost revenue serves as a nod toward other gaming revenue streams. Massachusetts legislators failed to pass iGaming legislation for the third straight year in 2026.
“In the months when sports betting is down, we still have iLottery and the casino growth to kind of balance us out,” said New Hampshire Lottery Commission Chief Compliance Officer Cooley Arroyo. “That’s where I think having a healthy mix of products is helpful as opposed to putting all your eggs in one basket. We would be grateful for the variety of models that we have to hopefully shore up a shortfall.”
Overall both states and sports betting operators will experience a significant decline in their Q2 and Q3 next year, regardless of an MLB lockout, due to the tremendous handle books are enjoying on the World Cup. Play began in June and ends on Sunday.
John Pappas, a gaming industry lobbyist, said the seasonality of sports offers another argument for an expansion of iGaming. Only seven states in the U.S. currently offer legal online casino play.
“There’s the risk of really putting your eggs just in the sports betting basket? Not only from a work stoppage standpoint, just general volatility of sports wagering. In New York where the Knicks won the NBA finals this year, every operator in the state got killed. The state made less money because a popular hometown team won. Having diversity in your gaming products, particularly with something like iGaming, you’re not going to see that up-and-down.”
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