FanDuel, DraftKings, BetMGM Join Forces For New York Mobile Sports Betting
The surprise of the year comes this Monday as the three largest operators – FanDuel, DraftKings, BetMGM – have made a joint bid for New York mobile sports betting access.
For weeks, it has been speculated that leading sportsbooks would join forces to form a “super-bid” in an attempt to launch in what would be the nation’s largest market.
Bally Bet is the fourth operator to join the group of four, which is led by the primary applicant FanDuel Sportsbook.
According to the New York Gaming Commission, which revealed a list of mobile sports betting applicants late Monday, as many as six applications with 14 total sports betting-related companies expressed interest in gaming licenses.
Under state law, the commission is authorized to award contracts to a minimum of two platform providers and a minimum of four sports betting operators.
What Happened on Monday?
Monday was the final day for applications for the Empire State’s online sports betting licenses. Hours later same day, the NYSGC released details on the six proposals it received.
The most significant proposal was from FanDuel, owing not only to its own potential but by its no less formidable partners – DraftKings and BetMGM.
The three leading operators in the country account for the overall market share of over 70% in US sports betting, according to market analysis.
All the bids were submitted Monday, a day before Gov. Andrew Cuomo announced his resignation. It should be mentioned that the commission’s list does not clarify if an applicant submitted a bid as a platform provider, operator, or both.
What’s the Difference Between A Platform Provider and Operator?
A platform provider will be authorized to run all the hardware, software, and data networks needed to process a sports wager. The operators will allow sports bets on systems maintained by the platform providers.
There’s no cap on the number of mobile sportsbooks licenses the commission can award.
The three-term governor, who was forced to resign following serious allegations this week, had forecasted that New York could become the nation’s largest sports betting market. He expected the Empire State could draw as much as $500 million in annual tax revenue from the industry.
The unprecedented sports betting model – a brainchild of the outgoing governor – is likely to set a minimum of 50% tax.
Who Else Submitted Bids For New York Mobile Licenses?
Kambi, a Malta-based sports betting tech provider – submitted two superbids by the deadline. The first included Caesars Sportsbook, PointsBet, WynnBET, Rush Street Interactive, and Resorts World Catskills.
Kambi’s second bid of the six applications, included Penn National, the former FanDuel CEO Matt King’s new company, Fanatics.
Three other bidders did not list any partners. Bet365, which operates the retail book for Resorts World Catskills – applied as a solo bidder. FOX Bet also applied without any partner.
The final applicant was Toronto-based theScore Bet, which was purchased by Penn National last week.
The NYSGC must pick at least two bids but can select more.
Successful platform providers will have to pay a one-time fee of $25 million to the state. Once the commission awards license to a minimum of two platform providers and a minimum of four operators, the commission may award further contracts if it pleases so.
The commission will now begin a review process that will include scoring applications. The six applicants will be invited to make an oral presentation next month. Multiple technical factors will determine “qualified” applicants, who will get bonus points for forming a partnership with a New York tribal gaming entity.