Jan 29, 2021 With New York facing a $15 billion budget shortfall from the coronavirus pandemic, online sports betting is viewed as one possible way to inject much-needed money into the state.
Following earlier remarks that indicated Governor Andrew Cuomo’s intent to support mobile sports betting in New York, a new twist has emerged. Cuomo’s office issued a release further detailing the Governor’s plans for mobile sports betting. There’s one big catch: Cuomo wants a Lottery-run sportsbook monopoly.
Governor Andrew Cuomo expressed that he is finally ready to move New York toward legalizing and regulating online sports betting. But given what happened with daily fantasy sports, the New York. Simply put, this means Cuomo wants one sports betting operator. This model is best likened to Delaware, where sports betting and online casinos are all operated by 888 Holdings. Revenue A Key Driver. Cuomo’s reasoning for a single-operator Lottery-based sports betting model is revenue. Several forms of online betting are already legal in New York. Daily fantasy sports, horse betting and greyhound betting are all legal within the state. Below is a list of operators based in the United States that already accept customers from New York. New York Online Sports Betting All the major sports leagues ( NBA, NHL, NFL, MLB, MLS, WNBA) are headquartered in New York City, along with many large financial and media companies. This combination would make New York a logical place to have the most innovative.
“Under Governor Cuomo’s proposal,” reads the statement, “the New York State Gaming Commission will issue a request for proposals to select and license a sports operator or platform to offer mobile sports wagering in New York. This operator or platform must have a partnership with one of the existing licensed commercial casinos.”
Simply put, this means Cuomo wants one sports betting operator. This model is best likened to Delaware, where sports betting and online casinos are all operated by 888 Holdings.
Revenue A Key Driver
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Cuomo’s reasoning for a single-operator Lottery-based sports betting model is revenue.
“At a time when New York faces a historic budget deficit due to the COVID-19 pandemic, the current online sports wagering structure incentivizes a large segment of New York residents to travel out of state to make online sports wagers or continue to patronize black markets,” Governor Cuomo said. “New York has the potential to be the largest sports wagering market in the United States, and by legalizing online sports betting we aim to keep millions of dollars in revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis.”
But Cuomo doesn’t want all the potential revenue to go to casinos. He made this much clear in a press conference, according to WKBW Buffalo. “I’m not here to make casinos a lot of money, I’m here to raise funds for the state,” said Cuomo.
Impact On Sports Bettors
Should New York move forward with Cuomo’s desired model, sports bettors would have a single platform to bet on. At best, the selected operator might be able to launch multiple skins of the same sportsbook with the functionality remaining the same.
Any move toward legal sports betting is a good one for the potentially massive New York market. But to many, this model is limiting.
For players, this means only one sports betting option. The Lottery’s partner could set its own odds and promotions without fear of much competition. For operators, it paints a stark picture: either win the contract or stay out of New York.
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The New Jersey Effect
New Jersey siphons its fair share of business from New York, drawing about 20% of sports betting revenue from bettors in the neighboring Empire State.
If Cuomo’s desired model comes to fruition, it spells good news for New Jersey. Operators in the state could still market to New Yorkers who want an option that isn’t partnered with New York’s Lottery. And if revenue is Cuomo’s chief concern when it comes to sports betting in New York, the impact of New Jersey should be first on his list of worries.
NEW YORK - After two years of online sports betting, New Jersey has seen month after month of record-setting revenues with gamblers wagering more than $931 million on sports last November alone. Now, Governor Andrew Cuomo is hoping to keep some of those dollars here in New York with legislation to authorize online sports gambling.
What You Need To Know
- Governor Cuomo says legal online sports gambling in New York would keep revenue in the state
- New Jersey gamblers spent 931 million dollars on sports wagers in November setting a record for the industry
- Attorney Daniel Wallach warns that Cuomo's plan could invite problems down the line
'We propose state-sponsored mobile sports betting to raise additional revenue' said Cuomo during his State of the State address Monday.
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He went on to release a statement saying 'by legalizing online sports betting, we aim to keep millions of dollars in revenue here at home, which will only strengthen our ability to rebuild from the COVID-19 crisis.'
Some say New York is well poised to become the top market in the game.
'By most conservative projections, we're talking about at least one billion dollars of wagers being made every month, maybe more,' said attorney Daniel Wallach of Wallach Legal, a law firm focusing on the growing sports wagering industry.
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Wallach says the governor's plan to award a single operator the right to launch online sports betting is different from New Jersey and could bring in big money for New York.
'A competitive bidding situation would lead these companies to basically one up each other and provide the highest possible revenue share for the state' said Wallach.
But he warns that the plan could invite problems down the line.
'It does come at the expense of consumer choice, competition, fairness, and it raises the stakes considerably on a legal challenge to the entire system,' said Wallach.
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The governor says the state is facing a $15 billion budget shortfall and that online sports gambling can help close the gap.