The New York State Gaming Commission has confirmed the nine operators that will be able to legally offer online sports betting for the first time in the state’s history.
It is a huge moment in the history of gambling in the United States, as the fourth most populous state will be opened up to the industry and, significantly, in time for the Super Bowl in February. Those who have been successful will pay a tax rate of 51% of gross gaming revenue.
Two groups were successful in their attempts, starting with DraftKings Inc., MGM Resorts International’s BetMGM venture, Bally’s Corp. and FanDuel, a division of Flutter Entertainment Plc, who all combined their services to win their bid.
The other group featured Caesars Entertainment Inc., Wynn Resorts Ltd., PointsBet Holdings Ltd., Rush Street Interactive and Resorts World, part of Malaysia’s Genting empire, all of whom were led by technology provider Kambi Group Plc.
It’s been over a year since efforts began to try and break into the market and New Yorkers will be delighted that they will no longer have to cross the New Jersey state line in order to place their sports bets. New Jersey has been a hugely successful venture for those operating within the state and there is great hope that can be replicated and surpassed in New York.
“Today is a momentous occasion for RSI, sports fans across the Empire State, and for the gaming industry at large,” said Richard Schwartz, chief executive of Rush Street Interactive. “We are delighted to have been selected by the NYSGC in a very thorough bidding process and extend our congratulations to our fellow consortium members.”
The bidding process was somewhat unorthodox as mobile operators were required to bid based on what tax rate that they would be willing to pay, as opposed to the usual process of a pre-approved tax rate. Additionally, all operators were required to partner with a land-based casino, paying them a $5 million annual service fee to host servers on their properties.
State Comptroller Thomas DiNapoli estimates that tax revenue that comes from the public placing online bets could reach nearly $500 million by 2025, rising from an initial $99 million in the first year.
Adam Greenblatt, CEO of BetMGM, added: “We would like to thank the New York Gaming Commission as well as congratulate them for keeping to their timetable.
“New York has the potential to be one of the largest sports betting markets in the U.S. and BetMGM is particularly well positioned to become a leader in the state given the strength of the M life customer database, close proximity of Empire City Casino to support our omni-channel strategy, and parlaying our already leading positions in nearby states.”
“With more than 19 million people, New York will be the biggest mobile sports betting market in the country, and we feel we are uniquely positioned to bring an incredible product to that market,” said Caesars chief executive Tom Reeg.
“We’re pleased to have been recommended for a license by the New York State Gaming Commission, and we thank Governor Kathy Hochul, the State Legislature, and the NYSGC for their continued leadership in making mobile sports wagering available to the Empire State.”