The gambling industry is one of the most lucrative in the world. It is predicted that this industry will be worth in excess of $50 billion in 2017, a figure that has been growing year-on-year since the new millennium.
However, on a list of the “most profitable” industries, gambling is nowhere to be seen. That’s because it’s just not as reliable as pharmaceuticals, tobacco or even film. The demands of the consumer waver in response to changes in the political and environmental sphere, and the industry needs to take big risks in order to achieve big payouts.
You could also argue that their income itself is not reliable, because the customers need to lose for them to win. But is that actually the case? Does the house always win?
The Casino Industry
The casino industry heavily favors the house. It relies on super-rich gamblers (known as “whales”) losing a fortune at the tables. It relies on drunken holiday makers spending their tourist dollars. And it relies on countless locals who flood through the doors everyday.
The casino has some of the biggest house edges you will find in the gambling world. This is essentially an advantage that the house has over you. In roulette it can be just 5%, which means that they can expect to receive a profit of $5 for every $100 that is wagered, with the player losing $95 of every $100 they gamble. Some other luck based games have house edges of over 20%, feeding the gambling coffers every time they are played. No house edge is in the negative, which essentially means that players are always swimming against the tide.
It is still possible to win big, of course. Casinos regularly pay out big wins and huge jackpots. But these are all factored into their finances. They know that for every 1 player that wins big, there will be 1,000 players that lose it all. It’s a numbers game, and no matter how you look at it, the casino always comes out on top.
The Sports Betting Industry
Sports betting is a little more complicated and a little more unstable. Sports betting companies are not guaranteed success like casinos are. In the United Kingdom, where sports betting is at its most popular, the biggest betting companies suffer massive downswings during certain unexpected results.
In early 2017, for instance, it was reported that the country’s largest betting company, WilliamHill, had suffered a huge financial shortfall because of “unfavorable results”. These were described as “customer-friendly” results, which is essentially their way of saying that things didn’t go to plan.
However, they can take solace in the fact that the average sports bettor loses more times than they win. The odds are always in favor of the sports book, literally. On markets that have a 50/50 chance, the odds are often listed at less than 2.00 (Evens) for both outcomes. This means that even if 50% of customers back one outcome and 50% back the other, the sports book will still be in profit.
This sort of odds manipulation is common and it’s how the sports books ensure that they remain on top. To the player, it means nothing more than a few odds listed at lower-than-expected prices. But to the sports book it means the difference between success and failure.
Player Versus Player
Despite everything said above, it is possible to make it as a professional gambler. In fact, there are many guides written by experts that can show you how to bet for a living. There are also many thousands of people who consider this industry to be their career. The problem is, they rarely spend their days playing roulette in the noise and lights of a casino, and they even try to avoid the sports books.
The majority of professional gamblers ply their trade on the poker tables. To them, this game is not about risk or luck. It’s about skill. They know how to win consistently and they can do just that. The richest poker players in the world earn tens of million every single year. They have their downswings, but no more than any other self-employed person, and the upswings are much more common.
There are also many professional “prop bettors”, also known as “hustlers”. They make their money by being incredibly good at certain games and then placing money on each outcome of those games. Many of the world’s best pool players have openly said that they can make more money hustling pool in local bars than they can on the professional circuit, and these “hustlers” exist for many other sports as well.
Post 2005, we also saw the emergence of a new kind of gambler: the exchange expert. These gamblers spend their days on the betting exchanges, manipulating them as if they were stock exchanges. A betting exchange works similarly to a stock exchange, in that bets go up or down depending on supply and demand. A gambler will place a bet weeks prior to an event when the market has only just been set. They will then study that market and any external indicators that may affect it. They will watch it ebb and flow, and they will wait for the right time.
Their goal is not to win that bet, but to make sure that they have placed bets on all eventual outcomes at the best possible time. This means that when the market they have bet on finally begins, they are safe in the knowledge that whatever the outcome, they will make a profit. In many cases, they have cashed-out for a profit before the market even begins.
So, in other words, the house pretty much wins every single time. You can beat them today, but they will beat you tomorrow. You can win big this week, but just know that they’ll be waiting to win their money back next week. And if you win and walk, doing what so few gamblers are able to do, then they’ll just win that money back from the next person, and the next, and the next.
The only way to consistently win as a gambler is to remove the house, to play against the player. Of course, that means you then become the one with a big advantage, the one who wins all of the time and is almost guaranteed success. In other words, you pretty much become the house. And when that happens, you’ve just bought yourself entry to one of the richest industries in the world.