USA
BetMGM is upping their game with a recent acquisition, and there’s some turbulence between FanDuel and District of Columbia’s OLG despite FD’s tremendous success since launching in the capital city. I’ll examine that and other exciting news items relevant to players, bettors, and industry professionals.
TLDR: a Bite-sized Overview:
- After struggling with its sports betting operations since 2019, Tipico is finally offloading its proprietary US sportsbook platform and operations to MGM Resorts International. This strategic move allows MGM to own the sportsbook ecosystem completely, from odds creation to risk management and software development. We’ve witnessed many mergers and acquisitions between operators in recent years. In the future, we’ll likely see more consolidations of this kind, where a large operator manages a proprietary platform by acquiring a provider to become more competitive.
- The National Self-Exclusion Program is set to become available in five states after launching earlier in 2024. In many states, the gambling industry is fragmented between regulatory agencies and the availability of offline, online, and tribal gaming. This has often created issues in an area that must be prioritized over everything else: responsible gambling. The initiative of the NVSEP is welcome as it can streamline access to self-exclusion nationwide and make it easier for problem gamblers to block themselves from gambling.
- FanDuel does what GambetDC failed to: get Washingtonians to place wagers online—FanDuel’s first whole month in May brought in 450% more bets than GambetDC managed the previous year. Despite the success, all is not well in the Capital City after lawmakers introduced provisions through the Sports Wagering Amendment Act of 2024 in the upcoming 2025 budget. The amended act could allow multiple operators to offer sportsbook services online. FanDuel has warned that they may terminate the partnership with Washington’s Office of Lottery and Gaming if the law was enacted. At the same time, an open market with multiple sportsbooks would nurture a healthier landscape with optimal betting options for Washington residents.
MGM Acquire Tipico’s US-Facing Proprietary Betting Platform
European iGaming operator Tipico first launched its proprietary sportsbook platform in New Jersey in 2019, specially developed for the US market. Since launching, Tipico has invested heavily in the platform and expanded into more states. However, despite being an excellent product, Tipico has struggled to gain traction in the United States sports betting landscape. It was reported earlier this year that Tipico Group was looking to sell its US business but only its sportsbook operations, as the Tipico online casino is performing well in New Jersey.
In 2022, Fanatics considered buying Tipico’s US business but passed on the opportunity. MGM Resorts International has now agreed to acquire Tipico's proprietary betting platform through its subsidiary LeoVegas. MGM will acquire US personnel, technology, and sports trading teams from the US, Colombia, and Europe as part of the deal.
The move can be seen as the next level of consolidation in the online betting industry, with sportsbook operators taking ownership of the underlying technology ecosystem. Traditionally, sportsbook operators focus on their operations while outsourcing what’s going on under the hood to sportsbook software providers, which take care of pricing, trading, risk management, streaming, front—and back-end development, and maintenance of the technology stack.
Acquiring a tried-and-tested team over building something from the ground up is the right path. BetMGM can now differentiate itself from the competition and offer unique betting experiences to bettors in and outside of the United States.
For Tipico, this couldn't have happened sooner, as their US operations have been struggling for five years. Tipico is not the only European operator struggling in the United States; several competitors from Europe have ceased operations or notified that they're leaving the United States. Most recently, Unibet announced that they'll exit all North American markets. There are also rumors that Betway is closing its New Jersey sportsbook operations.
The National Self-Exclusion Program Expands
The National Self-Exclusion Program (NVSEP) was recently launched and expanded to cover five states, with California set to go live in August.
For a problem gambler, the barrier to self-exclude should be minimal. Many states have outdated procedures, sometimes involving mail-in forms that make it difficult for problem gamblers to block themselves. There are also examples of states, including Nevada, that don’t have one system that blocks all forms of gambling. In other words, the NVSEP is an excellent initiative in the absence of a government-run self-exclusion program at a national scale.
California hasn’t legalized online gambling yet but allows brick-and-mortar cardrooms. While they have a self-exclusion program available, it’s not easily accessible. In California, a person can self-exclude by either visiting the cardroom in person, putting themselves in a risky situation where they could take an unexpected left turn, or mailing in a form remotely. The issue with the remote exclusion option is that forms need to be notarized, which comes at a cost. This is a typical example of how NVSEP can improve the self-exclusion process. They’ll offer free notarization services to effectively remove the price and make remote self-exclusion a cost-free, accessible option for problem gamblers.
Fanduel Is Absolutely Crushing It in Washington, D.C.
Bettors in Washington, D.C., have finally gotten what they deserve, thanks to FanDuel. In April, it was announced that FD would take over after GambetDC, the only sports betting option in Washington DC since May 2020. It was a period in which Washingtonians had to deal with poor odds and a bad user experience marred by technical issues. FanDuel took over in April and completed its first full month in May, claiming $4.9 million in revenue after accepting $29.7 million in bets. The nearly $30 million in bets is around 450% higher than what GambetDC managed during the same period last year.
The GambetDC app remains available on the market, but users cannot place new wagers and have until October 15, 2024, to withdraw their funds. They are still operating land-based betting kiosks throughout the capital. FanDuel is expected to replace these in the upcoming months as they fulfill their duties as the official betting partner of Washington’s Office of Lottery and Gaming (OLG).
On the heel of FanDuel’s success, the District’s upcoming 2025 budget features the Sports Wagering Amendment Act of 2024, which can open up the state for a multi-operator system where brands like DraftKings, BetMGM, and Caesar’s can offer their sportsbooks alongside FanDuel. The act introduced the proposal of a Class C Commercial License that would welcome mobile sports betting vendors. The budget is due legislative process and needs approval from the District’s Council and Mayor Muriel Bowser before it is enacted.
While FanDuel initially welcomed a multi-operator system, they are less happy about it since entering the lucrative exclusive partnership with OLG. FanDuel president Christian Genetski issued a warning in June, writing that they may terminate the partnership, leaving OLG without the support of FD. Reportedly, the letter by Genetski was delivered before the budget approval. OLG must find another operator to run its state-wide sportsbook if the partnership ends, and FanDuel could partner up with a local sports team and obtain a Class C license to offer their services in the state if the act came to pass. Keep track of the legislative process in JustGamblers’ bill tracker.
It’s easy to understand FanDuel’s frustration, having inked a deal less than three months ago. At the same time, the exclusive partnership is akin to a monopoly, which hurts consumers more than an open market would, where top-tier sportsbooks are free to compete and give bettors the best possible online betting experience.