New York State’s gaming commission recently announced nine sportsbook operators that can start accepting online wagers in 2022. This is a culmination of an extensive bidding process that concluded with a final proclamation in early November.
Current status quo
The state legalized in-person sports betting in 2019 at four casinos, all outside New York City. However, enacting legislation allowing online sports betting took longer. In the interim, bettors who wanted to place wagers online would travel across state borders to use NJ or PA online sports betting apps. This will no longer be necessary once the ball drops in Times Square, heralding the arrival of 2022.
Winning bidders
While nine sports betting operators may legally ply their trade in New York, they teamed up to bid for this privilege, forming two consortiums. The first consists of DraftKings, FanDuel, Bally Sports, and Bet MGM. The second is comprised of PointsBet, Caesars, WynnBet, Kambi, and Resorts World. Both groups are delighted they made the final cut. The nine CEOs expressed their gratitude to the New York Gaming Commission (NYGC) for ensuring that the process was fair and managed within the set timeframes with few delays.
While nine operators were the winners, others lost out on this lucrative opportunity. These companies include Fanatics and Barstool/Penn National, which formed a consortium with an unsuccessful bid. Fox Bet and Bet365 also did not make the list. Neither did Score Bet, which is currently under acquisition by Penn National.
Expectations
In a technology-dependent world, online sports betting makes perfect sense as a business model. It has proven successful in several other states, and New York should be no exception. With in-person sports betting available in a limited capacity, most New York residents do not get to place bets as traveling there is time-consuming and challenging. Now they can make their bets online without leaving home. New Yorkers are delighted by a chance to get in on some online sports betting action as several significant sporting events are lined up for 2022, especially the Super Bowl Final, the culmination of the National Football League (NFL) season. Football is America’s most bet-on sport.
Economic prospects
US sports betting has become big business since its legalization after the Supreme Court overturned legislation making it a crime. Most states immediately made in-person sports betting available to residents before offering online options. New York is expected to contribute millions of dollars in revenue for sportsbook operators. However, it has imposed a 51% tax rate on profits. This will limit operators’ bottom lines, but a substantial number of potential bettors still makes it a viable investment. As a silver lining, taxes will reduce to 33% with 13 operators in the long term.
