NYS Sports Betting Platform to Rake in US$100m, Study Shows

Spectrum Gaming’s study on the discussed online betting platform for the NY state has finally been released today, and it is what everyone expected. According to the study, the four commercial and the three tribal casinos can generate around US$1 billion from the launch of online sports betting, which will bring the state around US$100 million in tax revenue.

In his latest budget update Governor Andrew Cuomo proposed for a lottery-run, single-operator model for the online sports betting platform, which caused a bit of a backlash among media. As long as Governor Cuomo’s model of a single operator is not accepted, the multi-operator model will be more than profitable for the state and it will provide a competitive market for the gaming operators.

Single-operator Model

Experts of the gaming industry claim that having as many operators as possible is the most suitable way of having a competitive market, plus it is better for the state’s economy due to operators having to pay gambling revenue tax. While on the other hand, industry stakeholders are not quite fond of the proposed by Cuomo single-operator model, since it can lead to a monopoly, plus the lack of options can underwhelming for gambling enthusiasts.

Experts also added that limiting to a single-operator model could lose the state hundreds of millions of dollars as sportsbook licensing fees and renewals are a big portion of sports betting tax revenues. Cuomo’s proposal will leave the sportsbook options between four commercial casinos, which are – DraftKings, Fan Duel, BetRivers, and Bet365.

This will leave out The Oneida, which collaborates with Caesars William Hill, Mohawk, and Seneca tribes will be left out of the equation. Even horse track sportsbooks such as – BetMGM at MGM-owned Yonkers Raceway will also be unavailable. The state will lose other candidates in the face of Penn National’s Barstool Sportsbook.

The multi-operator model is currently under consideration by The New York lawmakers, and the approval of this model will allow 14 brands to enter the online sports betting industry in the state. The idea is to follow their New Jersey neighbors who have double the brand amount. Unfortunately, Cuomo claimed that the multi-operator model will bring money for the casinos and not the state.

Spectrum Gaming’s Study

Spectrum Gaming’s study on gambling behavior has been the first one in over 14 years. NYS officials believe that the field must be thoroughly examined since the gaming scenery has changed quite a bit since the previous study was made back in 2006. The study’s purpose is to analyze the gaming habits of the NYS residents, before approving the online sports betting program which is considered by regulators, to raise revenue for the state of New York

Increasing Addiction?

The expansion of the casino industry in New York State, and the proposals online sports betting platforms, in particular, have attracted concerns from the New York State Assembly, which will work on implementing new anti-gambling addiction measures across the state. University at Buffalo Research Institute on Addiction has come out with a study, according to which 4 out of every 100 Americans has difficulties of compulsive gambling, and 8 out of 100, participate in gambling activities every day.

Source:

Butler, Ryan. “New York sports betting study shows massive potential for a competitive market”, Chicago Tribune, January 26, 2021