It’s over for the little guy. On Monday, the New York Gaming Commission announced the firms that would take over the first mobile sports betting licenses in the state. Rather than respect the small family businesses that ran the sector in the past, the state has gone with nine of the largest names in the business, issuing temporary licenses to DraftKings, FanDuel, Caesars Sportsbook, Resorts World, PointsBet, Rush Street Interactive, WynnBET, Bally Bet, and BetMGM.
These sports-book operators will see their revenue taxed at a stiff 51 percent, with that rate locked in for the next decade. The announcement on Thursday comes after an eight-month process that began in April, when embattled former governor Andrew Cuomo agreed to allow sports betting and the sale of marijuana in New York for the first time to boost tax revenue. With licenses in hand, the process is ahead of schedule for the goal of having sports-gambling apps on New Yorkers’ phones by the Super Bowl.
New York State and the nine firms running sports betting are expected to split a whole lot of revenue from mobile sports gambling: Comptroller Thomas DiNapoli estimated in May that online betting could bring in $99 million in tax revenue in 2022, compared to marijuana sales, which were also legalized in April, that are expected to bring in $20 million. And by 2025, the comptroller estimated that annual tax revenue from online betting could reach nearly $500 million. Once the apps go live, they won’t lack for demand: In 2019, an estimated 20 percent of the money gambled in sports betting in New Jersey was coming from New Yorkers traveling over the Hudson to make their wagers.