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Saturday, March 25, 2023

$603M at stake during first nine days of online sports betting in NY – The Daily Gazette

SCHENECTADY – New Yorkers made $603 million in online bets in the first nine days of mobile sports betting in New York, with $171 million in just the first 39 hours.

The practice became legal in this state on Saturday, January 8 at 9 am. Data posted Friday by the New York State Gaming Commission indicated that the four companies operating mobile platforms in New York State at the time realized a total of $48.2 million in gross revenue. By the end of the first full accounting week, $603 million had been staked as of January 16.

The state will claim a little over half of this through 51% tax.

One of the four companies, Rush Street Interactive, has a local connection: it runs an in-person sports betting operation at River Casino Schenectady, and is an affiliate of Rush Street Gaming, the Chicago firm that owns River Schenectady.

Rush Street International came in fourth among four mobile operators: $10.6 million worth of bets in the first nine days and $446,696 in gross revenue.

This compares with $257.7 million in stakes and $22.7 million in gross revenue for Caesars, $200.4 million/$14.1 million for FanDuel, and $134.4/$10.9 million for DraftKings.

The numbers do not indicate real money bets or profits – large amounts of free credits offered by operators are counted as bets, even though they are not speculators’ money. Free bets lost by bettors are counted as gross revenue for the betting platform, even if it is their own money that they are getting back.

Financial data first published Friday by the Gaming Commission does not track promotional credits given by mobile betting operators, so there is no public window on how much money platform operators are spending to head their new market. Huh. Data on promotional credits have been reported for commercial casinos in neighboring Pennsylvania, a long-established mobile betting market, and New York.

Rush Street Interactive provided a commentary from CEO Richard Schwartz on Friday:

“As the New York mobile sportsbook market matures over time, we are confident that the BetRivers user experience and award-winning customer service will earn player loyalty as it has done in other markets.”

PlayNY lead writer Mike Mazeo told The Daily Gazette on Friday that he can only speculate about the huge financial gap between Rush Street and the three other companies. But he said the other three seem to have invested too much in free plays and advertising.

“They don’t have that celebrity pitchman,” Mazeo said of Rush Street International.

“I live in the city – FanDuel is always in your face.”

Caesar offered great deals to those using its platform and generated over a quarter billion dollars in stakes in the early days. But he confused his rollout promotion with vague terms and language, Mazeo said, leaving bookmakers frustrated and state officials twirling their fingers.

,[State Sen. Joseph Addabbo Jr.] To put it best – they need to get their act together,” Mazeo said. He added that operators as a group need to use clear language about their promos.

Sudden massive amounts of money are flying through virtual sportsbooks in New York and the 650,000 unique user accounts created in the first weekend are cause for great concern for organizations helping problem gamblers.

Brandy Richards, team leader at the Northeast Problem Gambling Resource Center in Albany, said that ubiquitous promotions across multiple media channels are drawing first-time users to a platform that’s easy to access, anytime, anywhere in their hands. Not real cash.

“We are already seeing an increase in calls to our resource center and our demographic is shifting to a much smaller group of individuals,” she said Friday via email. “We are also seeing its impact on people who have previously had gambling problems. The flood of advertising and promotional offers makes it challenging for them to recover from gambling addiction.”

New York State approved mobile sports wagering as a way to create a new tax revenue stream for itself. Unlike casino tax revenue, none of the mobile revenue will be shared with municipalities.

The state estimated $49 million in mobile tax revenue from January 8 through March 31 for the end of the current fiscal year. Based on a 51% tax rate, it achieved $24.6 million in mobile tax revenue from January 8-16.

The fifth operator, BetMGM, began operations on January 17 and four others are awaiting approval.

Mazzeo, which reports on all types of betting and gaming for PlayNY, part of a network of news sites that cover the legal gambling industry in every state, said time will tell if Caesars can get away with such crowdfunding. The market could maintain its lead, or if the market could maintain the bullish momentum of its earlier days, which came in the NFL’s post-season.

He predicted that the bettors would migrate to the platform with the best lines and promotions.

More from The Daily Gazette:

Categories: Business, News

World Nation News Desk
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