Oregon Lottery Hears Proposal To Offer Virtual Sports Betting

Oregon Lottery commissioners heard a pitch to allow Scoreboard, Oregon Lottery’s online sports betting app, to accept wagers on virtual sporting events.

The temporary rule would add language to the current Scoreboard rule to define virtual sports, detail how to determine winners, and ensure fairness.

“Offering virtual sporting events is an opportunity to keep players engaged and entertained, and help raise revenue for public programs,” stated a memo to commissioners. “This requires some modest amendments to our Scoreboard rules.”

A number of other states have considered adopting virtual sports wagering laws since COVID-19 containment measures shut down professional sports leagues in early March.

So far, only New Jersey has followed through.

Virtual sports a growing industry in the US

The lottery is accepting public comment on virtual sports until June 10.

Digital virtual sports programs use state-of-the-art motion graphics, sound, and play-by-play to simulate real-life sporting events. Some of the products even feature action between former real-life athletes and/or teams.

Probabilities are assigned to each virtual player and team, often based on actual historical data. A computerized random number generator (RNG) determines the result of the virtual event.

For instance, virtual sports pioneer Inspired Entertainment worked with Churchill Downs to create a virtual Kentucky Derby at-home party that was televised nationally on NBC in early May.

The race featured 13 former Triple Crown winners from the past 100 years. Software looked at historical data for each horse, as well as win/loss records to determine the probability of potential finishing positions.

Probability factors contributed to the end result, which an RNG determined in order to ensure fairness.

NASCAR also has developed a virtual NASCAR auto racing product, the iRacing Pro Invitational Series.

DraftKings partners with Inspired Entertainment

Oregon Lottery originally awarded the Scoreboard contract to technology provider SBTech.

Sports betting behemoth DraftKings acquired SBTech in a complicated IPO merger last month.

DraftKings also partnered with Inspired Entertainment in mid-April.

Inspired supplies end-to-end virtual sports betting products to regulated gaming, lottery and sportsbook operators in 35 markets around the globe.

Currently, the company creates 14 types of simulated sporting events, including football, basketball, soccer, horse racing and auto racing.

Through a partnership with the NFL Alumni organization (NFLA), Inspired’s NFLA Legends Football is able to field nearly a dozen teams of legendary NFL players in head-to-head action.

Additionally, Inspired’s virtual basketball games feature state-of-the-art motion capture technology.

Scoreboard sets specific rules for how virtuals work

The draft version of Oregon Lottery’s new temporary Scoreboard rules includes the following definition:

“A virtual sporting event means a computer simulation of a real-world sporting event that:

• Uses motion graphics, sounds, and play-by-play to simulate the overall experience of a real-world sporting event;
• Assigns random probabilities to each participant in the virtual sporting event;
• Uses a pseudo random number generator to determine winners;
• Has been tested and certified by a reputable certification authority.”

The lottery changed wording about placing bets to read:

“Except for bets on virtual sporting events, bets may only be placed on sporting events associated with a recognized governing body. For virtual sporting events, bets may only be placed on games that have been tested and certified by a reputable certification authority.”

The section describing the method for validating bets and determining winners now reads:

“For bets on virtual sporting events only, the official event results are determined by a pseudo random number generator. The pseudo random number generator is hosted on an independent server and the virtual sporting event has been tested and certified by a reputable certification authority.”

If approved, the lottery may ask the commission to permanently adopt the new rules. That is, if virtual sports prove to be popular with Scoreboard players.

The Lottery Commission meets next on June 26.