New York sports betting is officially live, making it one of the biggest betting markets in the country. Here’s everything you need to know so far.
It’s finally happened. New York state has launched one of the largest online sport betting markets in the nation to date with the passage of Bill S17D.
Starting on January 8th, 2022, players were able to place their bets at any of the four approved sportsbook operators in the population-dense state and just in time for the NFL playoffs.
But this wildly diverse and vast sports betting market is different from many of the others we’ve seen go live in the years since the legalization of sports betting in the U.S. To get a better understanding of the playing field in the Empire State, we are breaking down all things New York sports betting.
New York Sports Betting Operators
Of the astonishingly low number of betting licenses being offered in the fourth most populous state, only four of the nine proposed sportsbooks have met the state’s regulatory requirements and been granted approval at the time of launch.
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In addition, mobile licenses have been granted to five more apps, including:
These five are still awaiting final approval for launch, so expect to see them released in the coming months.
Why did New York Sports Betting take so long?
You might be wondering why it took so long for sports betting to get rolling in New York when neighboring states like New Jersey and Pennsylvania have been operating for a while now. Well, like most things that rely on governments to take action, it’s all politics.
Sports betting had been thriving in the state for years thanks to offshore sportsbooks and in-person betting at casinos, which may have been one of the reasons lawmakers felt they could take their time. The person most at fault for the delay however was former New York State Governor, Andrew Cuomo.
A Change in Governance
The since-removed governor Cuomo insisted that voters approve a Constitutional amendment that would allow for sports betting to be offered online in addition to the upstate casinos. Assemblyman Gary Pretlow, a long-time advocate of online sports betting in the state, expressed repeated frustration with the then-governor for his reluctance to work toward an alternative.
The needed amendment Cuomo was referring to was in response to a provision in the state constitution that includes a gambling ban. This is confusing considering the fact that there is a fair amount of gambling and casinos in the state. The ban includes notable exemptions such as the state lottery horse racing, and seven private casinos (four of which are currently operating).
Another major roadblock that faced the passage of a bill was the concerns from tribal nations in the state who currently have deals for casino operations. Specifically, the Oneida in Central New York, who expressed concerns that mobile betting would interfere with their longstanding deal with the state that gave them exclusive gambling rights in the region.
In the end, the betting associations that were eventually granted licenses were the ones that included partnerships with the tribes in the area.
This translated to a sharing of revenue as well as a creative work around to the constitutional amendment that guaranteed the mobile betting platform servers would be placed inside the state’s casinos.
High taxes in the state also led to some hesitancy on the side of sports betting apps with some of those that were granted licenses promising to pay more than 60% of their profits from bets to the state in order to garner approval.
Why Does the New York launch matter?
Being the fourth most populous state in the country gives New York the designation of a powerhouse state in the sports betting market with projected revenue in its inaugural year being estimated near $667 million. By 2025, it is believed that annual gross revenue will reach $1.1 billion. Revenue of that size would make New York the largest betting market in the country.
For years, those interested in placing bets would have to hop on a train and cross the river over to New Jersey. Alternatively, they could drive 100 miles outside of NYC to the closest casino and bet in person. In a state where a large portion of the population resides in New York City, the passage of the law could make a world of difference to those sick of having to find alternatives.
Another major headline in the passage of the law is the whopping tax rate on gross revenue. At 51%, New York will be subject to the highest rate in the country. Compare that to the 13% tax rate in New Jersey and you can see why New York residents might be concerned. That being said, industry sources expect the sportsbooks will be largely unaffected.
If bettors listen to New York Senator Joseph Addabo and agree to stay in New York in order to place their bets instead of continuing to commute to surrounding states, the possible tax revenue could have a massive impact on education, addiction programs, and youth sports for residents.
Additionally, investors are counting on the success of New York to convince voters in California and Texas as they prepare to vote on mobile app betting legalization. If a state with a large population like New York can grow revenue and succeed, it might sway voters in those states to do the same.
What we’ve learned so far…
While it’s only been a few days since sports betting went live, we have learned quite a bit about how things are operating so far.
The Experts Were Right About Pricing
Those aforementioned experts who tried to assuage concerns about pricing being affected due to the high tax rate experienced some major, “I told you so” as things got up and running.
The fear was that due to the abnormally high tax rate in New York there would be a downstream impact on those looking to place bets on the sportsbooks such as less favorable odds or pricing.
At the time of writing, however, everything in New York looks on par with all of the other states in which the sportsbooks operate. In Rhode Island and New Hampshire, where tax rates are similar, there have been no major differences in prices.
Some Sports Are Missing
College betting in New York is not allowed, so those were expected to be missing. What wasn’t expected was the exclusion of several sports and leagues as well as some types of wagers that are available elsewhere. The reasons are unclear but it surely has something to do with the long list of gaming rules in the state.
Intro Promos Are Hanging Around
Another fear generated by the high tax rate was that it would not be profitable for sportsbooks to offer enticing intro promotions.
That so far hasn’t been the case as many still have lucrative deposit matches and free bets up for grabs for new users.
These promos are available in addition to limited time promos available in all other states. For example, DraftKings’ ‘Bet $5, Win $280’ promo can be accessed in New York and beyond!
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Revenue is Promising
In just the first 12 hours of betting, $5.8 million of revenue was generated in the state. Compared to the meager 3.7 million generated by the in-person sportsbooks in the last two years, it is clear that New York is going to be a high-earning market.