PlaySugarHouse was the first to make its way into the online Pennsylvania sports betting market. You can access the PlaySugarHouse.com website on your computer and if you are in PA, they will redirect you to the correct site. You can also download the SugarHouse Sportsbook app if you are an Android user. For those with an iPhone, there is no iOS app for you to play on.
What’s The Issue?
This isn’t an issue on the legal side of things. It’s not even an issue with SugarHouse directly. The reason the SugarHouse sportsbook app isn’t on iOS at the moment is due to Apple. It is believed that SugarHouse, and other online sportsbook waiting to launch, is in violation of Section 4.2 in the App Store Review Guidelines, “Minimum Functionality”.
It is reported that SugarHouse isn’t the only operator with this issue. Apparently, a number of sportsbook operators in PA are having issues with Apple, which is causing a delay in launch for some apps. The “Minimum Functionality” section states that in order to receive approval from Apple, apps should “include features, content and user interface that elevate it beyond a repackaged website.” This means apps need to be clearly different than the website version. They can’t just be copies of what it would be if you were to access the website through Google Chrome for example.
Apple Goes a Step Further
Back on June 3, Apple went one step further. They released an update to their Guidelines which included Section 4.7, which addresses real-money gaming. “HTML5 games distributed in apps may not provide access to real money gaming, lotteries, or charitable donations, and may not support digital commerce.” The rule became effective immediately for new apps and those that are still pending approval. Existing apps have until September 3rd to abide by these guidelines or they will be removed from the App Store.
It is possible that Apple is doing this to get a cut of the gambling action. Apple takes a 30 percent commission on app sales and in-app purchases. For products “fulfilled outside of the app,” Apple gets no slice of the pie. Real money gambling would fall under that category since it doesn’t involve a physical product. When the app uses HTML5 code to connect to external operators to handle deposit and withdrawals, those transactions are considered to be on the “outside” of the app.
What to Expect
Apple could possibly force all developers to handle these deposit and withdrawal transactions with compiled code. If they were to do so, they could argue that those transactions are fulfilled within the app. That would allow Apple to get its 30 percent cut. If that becomes the case, we may not see any iOS sportsbooks, especially in Pennsylvania. Pennsylvania sportsbooks are subject to a 36 percent tax on revenue as is. They are not going to allow Apple to take 30% of their sports betting handle. That would more than eliminate a sportsbook’s profits.
Real money gaming apps are typically free of charge. However, Apple still has costs involved in reviewing and distributing those apps. Apple may be upset at the fact that these gaming operators are using their services for free to bring in large chunks of money. All while avoiding paying Apple its cut. It will be interesting to see how these new guidelines affect more sportsbooks as more and more states legalize sports betting. Not only sportsbooks but online poker and casino games as well. Unless Apple drops its percentage down for real money gaming apps (and significantly), we may not see any real money gambling sites on iOS.