Jai alai peaked as a professional sport in the United States in the 1970s and 1980s, when the “longest player strike in the history of professional sports” halted its momentum and started what became a 30+ year slide towards extinction. Today, Magic City Jai-Alai is the only active professional fronton in North America. But a pair of significant macro-level developments and a revamped game format have Magic City executives convinced it can “save the sport” and spark a stateside resurgence. “If we [can] do content distribution deals in the U.S. and internationally, and get the sport out in front of people again in [a] new format, they will understand it, grasp onto it and start wagering on it.” And if that happens, jai alai can be profitable in America again.
JWS’s Take: Jai alai (pronounced “high lie”) is not a new game. It originated in Spain in the 14th century and has been played in the U.S. for more than 100 years.
The abbreviated version that Americans are familiar with achieved a level of mainstream popularity in the ‘70s and ‘80s, largely because it gave people in Florida, Connecticut, Rhode Island and Nevada another sport (along with horse and greyhound racing) they could legally wager on in person. “The average crowd on a [winter] Friday or Saturday night at Miami or Dania [Beach] jai alai was anywhere from 7,000-10,000 people,” Scott Savin (COO, Magic City Casino & Jai-Alai) said. “And the average amount of money wagered on [those nights] was $1 million.” Connecticut frontons, which would host the sport in the spring, summer and fall months, drew comparable audiences.
But a players strike, which began in 1988 and lasted more than two years, put the sport out of sight and out of mind. “Basically when [the players] came back from the strike, people had found other things to do—especially in Florida with cruises to nowhere [gaining popularity],” Savin said. The Florida lottery also started selling tickets in January ’88, giving residents of the state another legal wagering option.
While audiences and betting handles dwindled, a Florida gaming law that required slot casinos to maintain a parimutuel gaming business (horse racing, greyhound racing or jai alai) kept the sport alive in the U.S. for the next three decades. But two years ago, that requirement was dropped, and as a result, two of the last three professional frontons in the state shuttered. When Miami and Dania Beach closed their respective frontons, the two venues were drawing just a few hundred fans for jai alai games. The sport was a loser for the casino.
Magic City began hosting jai alai matches in 2018 because “the attitude towards dog racing was [too] negative” (remember, Florida law required operators to have a form of parimutuel betting to keep the slot machines going). But Savin said the casino has decided to continue investing in the sport because it believes the legalization of sports betting and the rise of streaming technology have made it a viable business long-term.
Magic City Jai-Alai is not profitable—yet. But Savin believes the fronton can be within 24 months. “There are three main ways we can get [to] profitability,” he said. “One will be the sports wagering. The goal is to grow that [revenue stream] exponentially.”
Magic City has an exclusive sports betting partnership in place with Rush Street Interactive’s BetRivers brand. Fans in seven states (plus Ontario) can now wager on jai alai via a mobile app; Magic City’s games were available to bettors in just two states in 2021. As wagering on games becomes more widely available, particularly abroad (think: Spain, France, Belgium, Hong Kong and the Philippines), revenues are expected to climb. Six weeks into the 2022 season, the casino has seen its sports betting revenues rise 30% YoY.
The second revenue stream that could bring Magic City to profitability is content distribution. While its games currently air in “about 115 million homes,” that reach primarily comes through a relationship the casino has with FTF sports (which is free advertising-supported television). But Savin believes the league’s media rights will hold value and can be sold, at some point.
The third prong of the Magic City business model is team ownership. “We’re finding the idea of selling these teams as seasonal sports ownership opportunities, which we don’t believe [any other league] is doing, can be a huge potential revenue source,” Savin said. Magic City sold two of its four teams for the current season, each at $100,000 (media companies bartered for ownership of the other two). The cost will rise as incoming revenues grow and team owners share in those proceeds. Magic City envisions adding additional clubs in the future.
Magic City altered the business model around jai alai. It also reformatted the game to make it more accessible and appealing to the modern sports fan. Savin explained that the U.S. approach to play (think: rotational format akin to King of the Court)—and the betting method (see: parimutuel betting)—were too complicated for the average sports fan in 2020 to understand. The new format has the game looking more like racquet sports. “We play singles matches and doubles matches. The players play sets [head to head]. We changed the rules so players get two serves. Now we are playing the sport like a tennis or ping-pong fan would understand.”
Magic City also shrunk the court, a move that made the games faster (and one that plays right into the Gen-Z wheelhouse). The changes seem to be working. Live TikTok streams of Magic City games have been drawing an average of 75,000 concurrent viewers (peak viewership on Sun., March, 27, was 119,000 viewers). “[Young] people seem to be really captivated by this frenetic sport, where the ball is traveling at [more than 150 miles per hour],” Savin said.
Should Magic City manage to reach profitability, it just might spark a jai alai rebirth stateside. Savin said he has already been fielding calls from interested investors and/or operators. “Once people see that we’re on a good path and making forward progress, absolutely you could see more [professional] frontons springing up around the country.”