SBC?s Honor Of Gambling Legend Michael Gaughan Long Overdue
This month in New York, a quiet legend and pioneer will be inducted into the SBC Americas Sports Betting Hall of Fame. It won’t be his first such honor — he’s also in the UNLV Business Hall of Fame, the Southern Nevada Sports Hall of Fame, the Pro Rodeo Hall of Fame, and the AGA’s Gaming Hall of Fame — and I don’t get the sense the man really cares one way or another about such accolades.
But it certainly does feel like the inclusion of Michael Gaughan among this year’s four inductees is a bit of retroactive tidying up. Gaughan is, after all, one of the real innovators in legal sports betting in the United States. Perhaps the industry would’ve found its way to where it’s at now without him, but it didn’t.
Gaughan’s induction comes a year after South Point sportsbook director Chris Andrews and Gaughan Gaming sportsbook director Vinny Magliulo got in. The year before that, another top South Point exec, Vice President of Trading Jimmy Vaccaro, was inducted. And Art Manteris, a one-time Gaughan employee in the Barbary Coast sportsbook, was inducted in 2019.
All four of those guys owed important beats of their careers to Gaughan, who turned 80 this year. Says Gaughan:
“Remember, when I started my sportsbook, there weren’t many others in town. Jimmy w as a 21 dealer out of Pittsburgh who became the first employee of the Royal Inn sportsbook. He was just a pretty bright kid, and when I was looking for sportsbook people, he volunteered. Somebody asked me how he became the sportsbook manager. Well, when I got tired of running it myself, he had the most seniority.”
Gaughan is definitely proud of his influence, but when I asked why he thought he was being honored by the SBC Hall of Fame this year, he offered some typical self-effacing modesty: “They might be out of people.”
Gaughan a pivotal figure in sportsbook history
The Gaughan family name is one that insiders and Old Vegas aficionados know but few newbies do. Gaughan’s father, Jackie, was once a personal mentor to Steve Wynn when the future billionaire was a whippersnapper learning the ropes in downtown Vegas in the 1970s.
For decades, Jackie Gaughan’s name was literally part of the name of the Plaza, as in “Jackie Gaughan’s Plaza,” as the voices on the AM radio station, KDWN, would say back when they broadcasted from a studio there. And, more germane to this, in 1975, the Plaza became the first casino in Nevada to have a sportsbook. That was a year after Congress lowered the federal tax on sportsbooks to 2% from 10%. At 10%, the endeavor wasn’t worth the bother given that a typical sportsbook’s hold is between 4% and 6%.
Michael Gaughan struck out on his own in 1965 as a part owner of the El Cortez. In 1972, he and a partner bought the Royal Inn, a casino just off the Strip. Later in the decade, it became only the second casino outside of downtown Vegas — after the Stardust — to have a sportsbook.
In 1979, Michael Gaughan opened the Barbary Coast at the northeast corner of The Strip and Flamingo Road, with a sportsbook. The Flamingo was just to its north, Caesars Palace was across the street, the original MGM Grand was to the south and the Dunes was kitty-corner where Bellagio is now.
“I probably had that corner to myself for six or seven years,” Gaughan says of his sportsbook at the Barbary Coast, now the Cromwell. That’s because in 1983, Congress reduced the federal tax to 0.25%, which made it financially viable for everyone to open sportsbooks.
Gaughan went on to build four other casinos, all aimed at the local market, before selling them to Boyd Gaming in 2004 for $1.2 billion. Later, he bought back the South Coast, which is on Las Vegas Boulevard about six miles south of where it conventionally stops being considered The Strip and renamed it South Point.
What’s remarkable is that it draws such top-caliber sportsbook talent given its location and lack of glitz. It’s the only place in Nevada with a sportsbook and racebook housed in different rooms. It also, Gaughan believes, writes the most betting tickets in the state. “Money-wise, it might not be No.1, but in the number of tickets, we’re probably #1. I deal with the masses.”
Resisting the evolution of sports betting until resistance is futile
For a while, Gaughan says, he opposed “the phone betting” as he calls it. It just seemed antithetical to the whole point for casinos of sports gambling to him.
“A sportsbook is supposed to do three things for you: Bring people in, accommodate your customers and make a little money. I ran it as an amenity to my casino to bring people in. When they came with the phone, it violated rule one. I was probably wrong. Now I do phone business.”
Indeed, of course there’s a South Point app along with all the newfangled variations of betting including in-game wagers. He says it’s about 30% of his business.
What’s interesting is to realize that the more these things change, the more they stay the same. In the early days, Gaughan says, the basis for the odds came from illegal sportsbooks in New York City. Now, the initial lines are set “on the islands,” by which he means offshore casinos.
“Everybody looks at what everybody else is doing,” he says. “In Nevada, you want to favor the Lakers, you wanna favor the Rams, the West Coast teams a little bit. But the odds, well, you gotta start somewhere.”
So, too, did the whole business. And Gaughan is a living legend in that regard. His induction should be seen as special. And long overdue.
Read more from the State of Play column:
- How An Anti-Abortion, Anti-Weed Conservative Became A Leading Pro-Gambling Voice In Kentucky
- NFL Has A Lot To Answer To Over Sports Betting Rules And Suspensions
- Gambling Goes Green In The Vegas Desert
- BetMGM’s Online Poker Has A Quitting Problem For Problem Gamblers
- UNLV’s iGaming Payments Study May Be History’s Most Important Gambling Addiction Research