Featured in this article:
- Regulated Sports Betting Coming to New York
- Governor Cuomo’s Limited Operator Model Wins
- Goal Is to Launch by Super Bowl 2022
After many twists and turns, regulated online New York sports betting is coming. As part of a larger budget deal, lawmakers agreed to create a market for mobile wagering. Though the budget proposal was originally due last Thursday, politicians went into overtime to reach an agreement.
While details of the plan are still trickling out, it appears Governor Andrew Cuomo got his way. A limited, controlled online sports betting regime will be run through the state.
New York Sports Betting Appears User Unfriendly
The proposed budget deal includes two “platform providers” that will operate at least four mobile betting apps. The announced highlights of the budget deal indicate these providers will be major betting operations, like DraftKings and Bet MGM.
Even if the state exceeds its current minimum of four apps, bettors will have fewer options. New Jersey and Pennsylvania residents currently have 14 and 10 choices, respectively, to place their regulated bets. More competition between operators means more bonuses and promotions for players. These will be harder to find in New York.
Governor Cuomo Wins On Mobile Sports Betting
Unlike a competing proposal authorizing 14 or more mobile operators in the Empire State, this deal is limited. When he first announced his support, Gov. Cuomo proposed a single, monopolized mobile operator. Nearby New Hampshire grants DraftKings an exclusive online betting license in return for 51% of all revenue. It seemed the Governor wanted to use this model.
But New York is a vastly different state than New Hampshire. Its size alone would make a monopoly unwieldy. It appears legislators worked to reach a compromise on the number of operators.
State Senator Joseph Addabbo Jr. claimed that the bettors may have more choices in the future. Sen. Addabbo stated options could rise to “eight or 20” but that the deal includes a minimum of four. He is a longtime advocate for gambling options in the Empire State. This deal is just the beginning of the debate over how to run New York sports betting.
What Will New York Sports Betting Look Like?
Sen. Addabbo hopes mobile New York sports betting is live by the 2022 Super Bowl. The state senate has already approved the budget agreement. With the state assembly voting soon, there is a clear path to Gov. Cuomo’s signature.
Once the deal is signed into law, the New York State Gaming Commission can begin planning an auction. The agreement calls for the two providers to pay $25 million dollars for a 10-year license. Each provider will be required to house their servers at an existing New York casino – either commercial or tribal.
The auction will have blind bidding on the share of revenue being given to the state. Basically, each operator will offer to split its profits with the state. The two companies willing to part with the largest percentage of their profits will end up winning a license.
New York’s success will come from players who forego their favorite apps for limited choices in the regulated market.
Roadblocks and Lawsuits on the Horizon
Finally, it is unclear whether all New Yorkers will be able to participate in the regulated market. The state grants some Native American tribes gaming exclusivity in their territories. Based on the announced details, these tribes would need to bid in the competitive provider auction.
For example, the Oneida Nation has exclusive rights to gambling in a ten-county area of upstate New York. If the Oneida Nation does not receive a license, theoretically they could sue anyone offering gambling within their area. This area includes the cities of Syracuse and Utica and is home to a million or so New Yorkers.
The tribe released a statement regarding their disappointment in the deal:
A lawsuit could stop the launch of mobile apps while it is resolved. It appears Gov. Cuomo and his team will need further negotiations to secure smooth implementation. The rushed nature of this New York sports betting deal may cause future headaches.
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