Categories: IndustrySports

Sports Betting Ramifications From AAF Shutting Down Operations

Earlier this week, the Alliance of American Football league officially announced that they were suspending operations, which effectively shut down the league before they could even finish the regular season. With the disappointing closure, players and coaches were left scrambling to find jobs. In fact, some players were even left paying for their own plane tickets home.

With the TV exposure, decent ratings, and plenty of respectable football names running the league, it’s unclear where it all went wrong. Furthermore, the Alliance’s groundbreaking approach to integrated sports betting has left sportsbooks and AAF betting sites trying to figure out how to honor bets including AAF futures wagers.

The Decision to Shut Down the AAF

There are numerous theories as to what led to the shutdown, but there are no questions over who’s responsible for this decision – that blame lays squarely on the shoulders of Tom Dundon. The Carolina Hurricanes owner, and Texas billionaire, pledged to invest $250 million to the league after the first week of the season. He became the man in charge and was financially bankrolling the AAF until they could turn a profit. Dundon replaced Reggie Fowler who backed out of his initial commitment to invest $170 million into the AAF two months ago.

Last week, an ominous buzz started to grow that Dundon was considering shutting down the league. Fortunately, that buzz was silenced and the games for Week 8 were played. But, on Monday, April 1st, the buzz picked up again and it grew to a fever pitch. Some thought it was just an April fool’s joke, but Dundon wasn’t joking around. By Tuesday, he had decided to pull the plug on the AAF despite co-founders Bill Polian and Charlie Ebersol pleading to keep the league going.

Polian was very public in his disappointment over Dundon’s decision:

I am extremely disappointed to learn Tom Dundon has decided to suspend all football operations of the Alliance of American Football. Mr. Dundon took over, it was the belief of my co-founder, Charlie Ebersol, and myself that we would finish the season, pay our creditors, and make the necessary adjustments to move forward in a manner that made economic sense for all. The momentum generated by our players, coaches, and football staff had us well positioned for future success. Regrettably, we will not have that opportunity.

There’s no sugarcoating Polian’s comments as he puts all of the blame on Dundon. But, why would a billionaire decide to throw away $70 million dollars instead of seeing this first season through?

That’s the question that has perplexed fans, football media, AAF players and coaches, TV stations, business partners and the NFL.
A letter was sent out to AAF employees that stated the league needed another $20 million to finish the first season, which would’ve come from the promised investment made by Dundon. However, instead of funding another $20 million from his initial $250 million dollar commitment, Dundon decided to end the league.

Was it All About the Gambling App?

Immediately after the suspension of the AAF, rumors were swirling that Dundon only invested into the AAF in order to buy the gambling technology that the league used for its in-game sports betting app. After the dust has settled some, media outlets like ProFootballTalk have reported that Dundon’s investment into the AAF doesn’t give him ownership over the gambling tech.

That means Dundon won’t be the owner of this groundbreaking sports betting technology, which will be what the AAF is most remembered by. Despite being shut down before the season was finished, the AAF did bring some new concepts to the forefront and their sports betting tech will be a hot commodity moving forward.

Was there an AAF Champion?

Without finishing the regular season, the AAF was unable to officially crown a champion. Nevertheless, that didn’t stop the Orlando Apollos from declaring themselves the AAF champs as they finished with a 7-1 record, which was the best in the league.

After the league folded, head coach Steve Spurrier made the following comments to one of the local TV stations:

We’ve got to be the champs, right? We’re 7-1 and the other teams are 5-3. … We started the season wanting to win the Alliance championship, and if they declare a champ, hopefully, these guys will be declared the champs, because they certainly are deserving.

In addition to Spurrier, there are some sportsbooks and AAF betting sites that agree with “the ole ball coach” on Orlando being the champions. Dave Mason, of BetOnline, stated that the sports betting site has crowned the Apollos as the champs:

We are crowning the Apollos as the champion since they had the best record at 7-1. We are paying out Apollos futures and no-actioning every other team

FanDuel went a step further as they decided to pay out all future bets for each AAF team, even the Atlanta Legends and the Memphis Express who were both already eliminated from playoff contention. It’s believed that this payout ended up being less than $10,000 dollars.

Like BetOnline and Spurrier, FanDuel also declared the Apollos as the champs. Mike Raffensperger, FanDuel Group chief marketing officer, discussed the gesture to payout all future bets and Orlando being the champ:

The AAF should be commended for trying to do something disruptive in the sports landscape, and we hope this symbolic gesture shows the players and coaches that sports fans everywhere appreciated the hard work and sacrifices they made for entertaining us with spring football. While we’ve declared the Apollos honorary champions, we think the biggest winners should be our customers and hope they enjoy their payouts.”
The Westgate SuperBook in Las Vegas has decided to refund all AAF future bets. They will not declare a champion because there wasn’t a championship game played. They’ve ruled it as “no action.

As of this writing, DraftKings hasn’t decided if they will payout AAF future bets or declare the Apollos as champs.
Those fortunate enough to bet on the Orlando Apollos to win the AAF championship, through BetOnline or FanDuel, were paid out at 5-to-1 odds.

Final Thoughts on the AAF Shutting Down

I find this entire situation to be incredibly disappointing. This league was fun to watch even if it didn’t have large crowds or superstar players. The rule changes made the on-field action even more entertaining than the NFL’s longer games. Additionally, the AAF app and in-game sports betting were cool concepts that deserve a lot of credit. I’m sure other leagues will build off the groundbreaking tech that the AAF unveiled.

It’s sad to see how the AAF players are being hurt the most by Dundon’s decision. There are players injured and have no more medical insurance, players stranded in cities far from their homes, and players who have lost all of their income.

The AAF shutting down should be a cautionary tale for billionaires looking to start alternative professional football leagues. You can bet that WWE’s Vince McMahon will take note of what the AAF did right and wrong, so that his XFL league will be a hit when it comes out next year. Right now, Vince already has a leg up on the AAF. McMahon is funding the league himself after cashing out WWE stocks. Additionally, if he chooses, Vince can put the XFL games on his WWE Network, which already has over 1.5 million subscribers.

As for the AAF, it was fun while it lasted. Unfortunately, they couldn’t overcome the odds stacked against their success.

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Rick Rockwell

As a longtime freelance writer, avid sports fan, former athlete, and experienced sports bettor, Rick Rockwell has risen up the ranks at GamblingSites.org to become the self-professed "King of the Blog" in his first year with the site.

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