New York Approves Online Sports Betting With Limited-Operator Model
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After months of back and forth, lawmakers were between having a more monopoly-based plan for operators within the state, compared to a limited model, which was backed by Gov. Cuomo. Days after the budget deadline, the framework was finally finalized and approved for a limited operator model. Sports betting has been legal in New York but has been limited to in-person bets at upstate casinos. This created a larger volume for New Jersey, as those in New York would make the drive to register and wager online. New York will now be able to fully capture their market, but lots of questions remain on who the operators will be.
Possible Licenses
Most lawmakers and the gaming industry were against a limited operator system, which was pushed by Gov. Cuomo. However, there might have been some middle ground reached with four possible licenses up for grabs. These will be extremely important for operators due to the New York market being massive.
The New York lottery will be the one issuing licenses, and at the moment, there would be two mobile betting operators and up to four skins available. Most larger sportsbooks have some sort of foot in the door already. DraftKings and FanDuel both operate within the state as partners with casinos. Penn National moved in earlier this year in anticipation of New York approving online sports betting. However, it is unclear if Barstool Sportsbook would be eligible for a license.
While most states run an open model that provides more licenses than New York’s projected model, which New York could eventually turn to if this model does not work out, much of this comes from Cuomo’s projection that the state could bring in $500 million in revenue with a limited operator system, compared to the multi-operator system. We have seen both models work, but most lottery-run models have been in vastly smaller markets.
What’s Next
There is still a lot to hammer out, but the framework is at least in place to begin moving forward with online sports betting. News has begun to come out about the tribal exclusion that will create issues moving forward, but nothing has come forward from lawmakers on how they will handle the situation. One of the major questions also being asked is if a sportsbook operator can still bid for a license without having a retail casino in the state. We should begin to see some of these questions answered over the next few weeks.
When Will Online Betting Be Available?
Lawmakers and operators will both be shooting for the beginning of the football season. This tends to be the constant deadline set, as it is the biggest betting season. There is still a lot that needs to be fired out as the regulators will see out licenses and certification. Given this is breaking news, further details will give us a better timeline for when this should be available. The positive remains that they will at least be addressing this in 2021, rather than not coming to an agreement and revisiting later on.
