New York Gaming Commission to Discuss Mobile Sports Betting Bids on Monday
Posted on: November 4, 2021, 02:22h.
Last updated on: November 4, 2021, 02:49h.
The New York State Gaming Commission will meet Monday afternoon to consider awarding mobile sports licenses. That’s according to an agenda released by the state agency Thursday afternoon.
The agenda packet does not provide a list of recommended operators or platform providers. But a report published earlier this week by The New York Post indicated at least two groups that have a total of nine operators between them have been given paperwork tied to their selection.
In addition, the agenda also includes adoption of rules related to mobile sports betting. The state posted regulations on Sept. 1, and the public comment period ended on Monday.
The approval of regulations would be a critical step toward the launch of mobile sports betting applications in the state. Lawmakers passed the mobile sports betting language in April as part of the annual state budget. At that time, state Sen. Joseph Addabbo, D-Queens, hoped operators could launch their apps in time for the 2022 Super Bowl, which will take place Feb. 13.
The meeting will start at 1:30 pm ET and will be available to view on the Gaming Commission’s website.
Groups Led By FanDuel, Kambi Reportedly Approved
According to The Post’s report, the expected licensees include a group led by FanDuel that also has Bally Bet, BetMGM, and DraftKings, and a group led by Kambi, which includes Rush Street Interactive, Caesars Sportsbook, Wynn Interactive, PointsBet, and Resorts World.
Those two bids combine to include eight platform providers and nine operators. Based on the final tax matrix the state released two weeks ago, that would set the tax rate at 51 percent.
The NYSGC released the request for proposals (RFP) solicitation in July. It called on bidding groups to propose their own tax rates. The state took the highest rates and established a matrix based on the number of platform providers and operators. Former New York Gov. Andrew Cuomo wanted the state to receive at least half of the revenues from sports betting operators, and the RFP rewarded applicants who submitted proposals with such a high rate.
The state would also be in line to receive $200 million in licensing fees. Each approved platform provider must pay a $25 million fee to receive a license.
In exchange for the tax rate being over 50 percent, the state will give platform providers a 10-year license.
Kambi submitted a second bid as well with Penn National Gaming’s Barstool Sportsbook and aspiring sports betting operator Fanatics. Bet365, Fox BET, and theScore BET also submitted proposals back in August.
Gaming Execs React to New York News
The report and Gaming Commission’s announcement come as many companies involved in the bidding release their third quarter financial reports and hold calls with investment analysts to review them. The New York sports betting licenses have been a topic on at least a couple of the calls.
MGM Resorts International President and CEO Bill Hornbuckle told analysts during his company’s Wednesday afternoon call that he expects nine or 10 operators to be approved by the NYSGC. MGM’s presence in New York, where it operates the Empire City Casino in Yonkers, was a crucial element to the decision in proceeding with a bid.
He added that the FanDuel group was not the one that suggested a top rate of more than 60 percent.
New York represents the largest population of MGM’s loyalty rewards program members (called M-Life) in states with legal mobile sports betting, Hornbuckle said. That will help control some of the costs in what is one of the nation’s most expensive media markets.
We’ll be there day one, which is also critical,” he said. “So, I think we’ll get off to a great start. Time will tell with sports how much money is to be made. Again, for us, it’s an omni-channel play, it’s a brand play, and we’re going to have a huge presence there. Hopefully someday we get to online, iCasino. But you know, that’s something for well down the road.”
Jay Snowden, president and CEO of Penn National Gaming, told analysts Thursday that he was less certain. He felt the high tax rate and license fee made the company question whether sports betting in New York would be a profitable venture.
The Post report indicated Penn’s Barstool and its bid mate, Fanatics, did not receive the paperwork the two larger groups received.
Snowden’s comments seemed to confirm that report. He told analysts he had mixed feeling about how New York set up mobile sports betting.
“The state’s going to make money,” he said. “I don’t think a single operator will make money in New York. So, I’ve always struggled with… Would you rather be in or not? I think objectively speaking, you’d probably rather be in than not be in. But it’s one of those states where if you’re not in, you’re not crushed by that either, maybe from a (total addressable market) perspective and from a revenue perspective.”
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