Tennessee’s online sportsbooks generated $180m in wagers in December to close last year with the best two-month debut in US sports betting history.
An untested market before launching in November, Tennessee is off to the kind of start that almost no one could have predicted, according to analysts from PlayTenn, which offers news and analysis of the fledgling Tennessee gaming market.
In a December that featured four NFL Sundays, down from five in November, bettors placed $180.9m in wagers, topping November’s $131.4m handle by 37.6%. December’s wagers produced a “win” of $13.9m for the operators, up from $13.2m in November. And the month’s win injected $3.1m into state coffers.
Jessica Welman, analyst for PlayTenn.com, commented: “Tennessee launched with what many thought were a lot of question marks, but it is proving to be ‘The Little Engine that Could’. It seemed operators were slow to get to the state, many were concerned the 10% hold mandate would tamp down demand, and there were questions on whether or not the Tennessee Education Lottery was up to the task of regulating the industry.
“Those concerns seem like a distant memory now as Tennessee has catapulted itself into becoming a major player in the US industry in just two months.”
Through the market’s first two months, Tennessee has generated $312.3m in bets, by far the most of any legal sports betting jurisdiction in US history. The next closest was Indiana, which produced $126.9m in its first two months in 2019.
The state also shattered the records for the best first month and the best second month. Indiana held both records, hitting $35.2m in September 2019 before reaching $91.7m in October 2019.
Moreover, it set a new standard for operator revenue with $27.1m. Indiana generated $20.1m in its first two months, including $11.5m in its second month.
Tennessee’s hot start can be attributed to several major factors. First, the state launched its sports betting industry with online sports betting, which attracts vastly more in bets than retail sports betting in every state that has both.
Secondly, with no retail component in the state, there was no in-person registration requirement for online sports betting, which can artificially depress a market. None of Tennessee’s seven neighboring states offered online sports betting during the Volunteer State’s first two months, and only two, Arkansas and Mississippi, are home to any retail betting. And the Tennessee Titans’ playoff run undeniably spurred local interest.
“Tennessee launched under near-perfect conditions and that can be seen in the early results,” said Dustin Gouker, analyst for PlayTenn.com. “Even with added competition from Virginia now going live, Tennessee’s start has established the state as a significant player in the US. And I don’t see anything that will stop the market’s momentum in the short-term.”
As it stands, Tennessee is now the nation’s seventh-largest sports betting market with plenty of growth still to come. Only four sportsbooks are in operation so far. But more are expected to come in the coming months. That includes the imminent launch of TwinSpires as well as WynnBET and William Hill.
“Having FanDuel and DraftKings, the nation’s two largest operators, in place at launch has helped fuel Tennessee’s surge,” Welman said. “But more high-quality operators will help mature the market. As good as Tennessee’s start has been, the best days are still to come.”