Nine operators have secured licenses in the state; Bally Bet, BetMGM, Caesars Sportsbook, PointsBet, Resorts World, DraftKings Sportsbook, FanDuel Sportsbook,
WynnBET, and Kambi. Jay-Z fronted operator Barstool Sports failed to win a license, and that is down, in some part, to the ongoing allegations levelled at founder David Portnoy.
In order to secure the licenses, the nine operators have had to agree to pay 51% in tax on their revenue, which is higher than in any other state, but clearly a price they were willing to pay in order to access such a vast market. You can expect the nine operators to set themselves up in something of a sports gambling odds frenzy as each tries to achieve a stronger market share than the other.
The median online sports betting tax rate sits at around 11%, and only New Hampshire has a comparable tax rate to the one that’s about to be imposed upon New York operators.
No timeline has been released in terms of when the market will go live, but many will be hoping it’s before February 13th next year, when the Super Bowl takes place. That’s no surprise given just how much money is staked in sport’s biggest showpiece event of the year.
The status of sports betting in the US is something of a complex one. Thirty-three states offer some sort of legal sports betting though only 18, before New York, offered online options for doing so.
One interesting aspect to consider is how the legalization will affect neighbouring states, most crucially New Jersey. Up until now, as much as 20% of the sports betting action in NJ is said to have come from New Yorkers crossing the Hudson River, so you can expect a downturn in fortunes for operators there.
The estimate of a $1 billion windfall for sports betting operators in the first year of operations in New York may seem steep, but consider that in Colorado, they cleared $2.3 billion in wagers in their first year of legal sports betting.
Think also about the fact that New Jersey recently became the first state to rack up $1 billion in a single month, making over $7 billion in 2021 as a whole.
The possibilities are seemingly endless, and that’s a fact that New York Senator Joseph Addabbo has been keen to trumpet;
“Once we enter the arena, we’ll eclipse New Jersey,”
Indeed he seems to be on the right track, and the sky may well be the limit for those who enjoy a sports bet or two.