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After years of losing out to illegal operators and nearby states, principally New Jersey, New York has finally regulated online sports betting, a move which, it is hoped, will soon generate half a billion dollars in tax revenues (£364m/€428m).
The state’s Gaming Commission will now select at least two platform providers, through a competitive bidding process, to operate sports iGaming.
Providers may partner with multiple operators—or skins—to provide consumer-facing products.
Echoing the delight of sports fans who are excited by this major extension of the U.S. iGaming market, New York State Sen. Joe Addabbo, a Democrat from Queens, crowed: “Now there’s no reason why we shouldn’t be able to bet on the Super Bowl.”
Mobile sports betting is only legal in 16 of the 50 U.S. states.
“Right now, New York is probably the grand prize, given that California is probably a few years away,” said Daniel Wallach, a top gaming industry lawyer.
Early indicators suggest that preference will be given to New York State’s existing commercial and tribal casinos if they bid for the online licences and want to partner with experienced mobile-betting companies.
Six leading online companies—among them Bet365, FanDuel, Fox Bet, Kambi and theScore–are currently bidding for online sports betting licences, it has been reported.
Under the ambit of the state’s current betting laws, servers handling mobile sports bets must be anchored at existing real-world casinos. And providers, who will be given 10-year licences, must pay a casino US$5 million a year for their hosting services (£3.64m/€4.28m).
Not all of New York’s gaming community, perhaps fearful of the looming competition, is happy with the iGaming breakthrough.
The Oneida Native American nation, for example, who run several lucrative casinos mid-state, have called the legislation “a step backwards” and “unbalanced”.
But online heavy hitters can barely hide their excitement at the news of imminent market liberalisation.
“We’re looking forward to the bidding process and hope we are ultimately able to bring our FanDuel sportsbook product to customers in our home state,” said the company’s spokesman Chris Jones.
The bid led by FanDuel is a powerful package with a projected tie-in with DraftKings, BetMGM and Bally’s as both platform providers and operators — with each planning to pay a lucrative 50 per cent tax rate to the state.
Safe and responsible gambling protocols have been embedded in the new iGaming legislation.
Online punters, for example, will be limited to betting a maximum of US$2,500 each year using only one nominated—and certified–credit card (£1,820/€2,140).
Limits aside, New York is undoubtedly hot right now.