Since the summer slowdown, the New York sports betting market has picked up the pace with the help of the NFL and college football seasons. Still, lesser-known sportsbook brands are thinking twice about joining the most expensive market in the industry.
Sportsbook Operators Are Doing Much Better Now
Currently, there are nine mobile bookmakers that are taking wagers in the Empire State. The numbers aren’t off the charts, but it has been much better than the summer months, as the MLB was the only major league in season during that span.
New York is experiencing its first full NFL season as the operation began on January 8th of this year.
For the week ending on October 16th, sportsbook operations combined to register a handle of $323 million. It aligns with the numbers that were put together in the spring months.
The number has settled between $300 million and $325 million for the fifth time in six weeks, according to the New York Gaming Commission. Experts can’t make conclusions too quickly as other leagues like the NBA and NHL just began.
The Results Have Favored the House for the Most Part
When looking at the reported results, one must factor in that the Empire State has the highest tax rate for bookmakers, which is set at 51 percent, which ties to New Hampshire. Bookmakers in the state also have to pay taxes on promotional credits and deductions.
Gross revenue for the week was situated at 37.2 percent due to a hold of 10.5 percent. The national average for the industry is set at 7.2 percent. For nine out of 12 weeks, these online sportsbooks have a combined hold rate that has exceeded 10 percent.
Still, the monthly handle is still ways away from reaching its full potential. Even though the monthly handle in September was $1.2 billion, the first three months of operation brought in at least $1.5 billion in wagers each month.
Bettors across the Empire State have wagered $12.26 billion since the operation began. Since launch,
operators have generated $994 million in gross gaming revenue, translating into an 8.1% hold rate and $507 million in tax revenue. The jurisdiction will easily surpass the $1 billion gross revenue mark by next week’s handle release.
It is estimated that three operators brought in 80 percent of the market share in New York. The three online operators are FanDuel with 35 percent, DraftKings with 25 percent, and Caesars with 20 percent of the market share. The other six platforms make up 20 percent combined.
Why do Smaller Sportsbook Brands want to Stay Out of NY for Now?
Fanatics CEO Michael Rubin is glad that his company didn’t win a bid in New York. Fanatics is on pace to launch its sports betting platform in January.
Rubin is happy to be left out as the license fees and taxes were going to be too expensive; even DraftKings doesn’t expect to be profitable for the next five years. Instead, he has geared towards markets like Maryland. Most sportsbooks have waived the white flag in California as sports betting in the Golden State is becoming less likely in 2022-23.
