Update: CBS to sever ties to Sportsbook
By Tom Farrey
ESPN.com
Embarrassed by its link to a sports gambling website through its Internet partner,
CBS television said Friday that it has received assurances from Sportsline USA
that the Internet company will sell off its ownership of a web address used by
an offshore sports book. "CBS Sports was unaware of Sportsline USA's
relationship with Sportsbook.com," CBS said in a press release. "The network
has taken immediate action. Sportsline USA has assured CBS Sports that the
URL (uniform resource locator) currently leased to sportsbook.com will be
sold." The company added, "CBS Sports will continue to support the NCAA's
agressive anti-gambling efforts." The announcement comes in response to an
ESPN.com report Thursday that Sportsline USA, which is 18-percent owned by
CBS, makes money from Sportsbook.com, a popular web site headquartered in
the Caribbean that takes bets on the NCAA Tournament. CBS television is the
broadcast partner to the NCAA for the men's basketball tournament.
Sportsline USA, based in Fort Lauderdale, Fla., also produces CBS Sportsline,
owns the web address to Sportsbook.com. Michael Levy, Sportsline USA
president, confirmed that the company leases that address out to the offshore
sportsbook for a fixed fee.
Levy had said he "can't remember" if he told his CBS, his corporate partner,
about the relationship.
NCAA executive director Cedric
Dempsey said he learned of the
year-old relationship in the past
month. He said he had expressed
concern about the relationship with
CBS.
"At this point, there's not much we
can use other than persuasion,"
Dempsey said prior to the CBS
announcement. "Maybe in the next
go-round in our (television) negotiations we will be able to be a little stronger on
that issue."
Stung by point-shaving and gambling scandals at several colleges in recent
years, the NCAA has identified online gambling as a direct threat to the integrity
of its games. On Tuesday, the organization testified in favor of a U.S. Senate
bill that would give law enforcement officials more tools to block Internet
access to gambling sites.
The Sportsbook.com address is registered to Sportsline USA but the gambling
operation is run by Global Internet, a company based on Margarita Island, a
territory belonging to Venezuela. Patrick Callahan, a 28-year-old Canadian who
manages the site for Global Internet, said the company has about 50,000
customers and has become "very profitable."
Levy declined to say how much money Sportsline USA gets from
Sportsbook.com other than to say, "It's worth our while or we wouldn't go for
it." No mention is made of Sportsbook.com, or the revenues it generates from
the lease, in the company's most recent public financial statement.
"We make money on it," Levy said. "It's a nice URL (universal resource
locator)."
Said Callahan: "A lot of people don't think the URL matters, but a couple of
them do -- like books.com and computers.com." Sportsbook.com falls into that
valuable category because it stands out as an obvious destination in the online
gambling world, where more than 100 sportsbooks are now in business.
Levy said he has received offers to buy the address but rejected them because
over the long run he believes he can make more money by leasing it. Prior to
the ESPN.com report, he said he has no plans to get rid of the web address,
although Callahan said his company will make another bid for it in the next six
months.
"That's really when it becomes profitable to them," Callahan said.
Beyond the lease agreement, Sportsbook.com uses some Sportsline USA
personnel and equipment to manage the site. The gambling site also is a major
advertiser on Vegas Insider, another Sportsline USA property and a guide for
sports bettors. Sportsbook.com also uses design elements that are similar to
Vegas Insider -- to better create a co-branded look, Callahan said.
Dempsey said the NCAA is concerned about all media companies' relationships
to gambling. ESPN, for instance, owns a company called SportsTicker that sells
its news updates to oddsmaker Jim Feist. Feist repackages that news with his
own information, including betting lines, and sells it through his own ticker
service.
Unlike Sportsline USA, however, SportsTicker receives no money from an
offshore sportsbook.
"I have been a little surprised that they (Sportsline-Sportsbook.com) have that
sort of relationship," said Sue Schneider, chairman of the Interactive Gaming
Council. "All you need is one hyperactive attorney general and it's a risky
business." |
