Michigan’s online sportsbooks and casinos are off to a historic debut with more than $115m in sports bets taken in the final 10 days of January, while online casinos generated $29.4m in gross receipts.
Combined with the state’s retail handle, Michigan’s sportsbooks are off to the best start of any state that offers both online and retail sportsbooks, but that only offers a narrow window into the future for one of the most promising legal markets in the US, according to PlayMichigan analysts.
The state’s online sportsbooks generated $115.2m in bets in the 10-day period in January, producing $13.3m in total gross sports betting receipts. With a typically promotion-heavy debut that whittled taxable revenue down to a combined loss of $5.2m, January’s bets yielded $111,696 in state tax revenue.
“The circumstances for Michigan’s online launch could not have been better ahead of two of the biggest sports betting holidays of the year,” said Dustin Gouker, analyst for PlayMichigan.com. “Ultimately, it’s a small sample size, and the results of which are less important than sportsbooks launching and engaging sports bettors and setting the groundwork to flourish for years. By that metric, Michigan’s launch was a success.”
Combined with January’s retail sportsbook handle, which reached $35.7m in January, Michigan’s total sports betting handle hit $150.8m. That makes Michigan the highest total monthly handle for a state debuting online sports betting in US history, easily surpassing Tennessee’s mark of $131.4m set in November.
In all, online sports betting accounted for 76.3% of the state’s handle. In fact, 10 days of online sports betting was almost as much as Michigan’s entire $130.8m retail handle during 2020, a total hampered by pandemic-related restrictions on brick-and-mortar casinos.
“There is no questioning the power of online sports betting at this point,” said Matt Schoch, analyst for PlayMichigan.com. “January was just a snapshot, but online betting will eventually account for 90% or more of the state’s total handle, which would put it much more in line with other legal jurisdictions that offer both online and retail betting.”
Michigan got off to a quick start in large part because it launched on January 22 with 10 online sportsbooks, more than any other state in US history. That list includes the nation’s two largest operators FanDuel and DraftKings, as well as its main challengers, including Penn National’s Barstool-branded app, BetRivers, and BetMGM.
Of those, FanDuel, which partners with the MotorCity Casino, topped the market in the first month with $32.6m in wagers. That produced just $622,372 in gross sports betting receipts. DraftKings/Bay Mills Indian Community was second with a $28.2m handle, yielding $3.4m in gross receipts. BetMGM/MGM Grand Detroit’s $22.8m handle led to market-topping $5.1m in gross receipts.
“Launching with nine operators ready to go from the beginning is unlike anything else we’ve seen before,” Gouker added. “Having FanDuel and DraftKings, in addition to BetMGM, BetRivers, and Barstool, accepting bets on the first day of operation makes Michigan instantly one of the most competitive markets in the US. The vastness of choices is great for consumers, obviously. But it shows just how much confidence operators have in the future of the Michigan market.”
Online casinos and poker enjoyed an impressive debut themselves, hitting $29.4m in gross receipts, more than any other in US history in online casino gaming’s first month. That yielded $4.3m in tax revenue in its 10-day debut in January.
Online casinos and poker racked up $2.9m per day in gross receipts, a per-day tally that has only been topped by New Jersey, the nation’s largest online gaming market. The BetMGM/MGM Grand Detroit easily topped the market with $11.1m in gross receipts, which generated $1.7m in taxes.
“Online sportsbooks draw more attention, but online casinos are typically a far more consistent revenue generator for state governments,” Schoch said. “With nearly $30m in 10 days, Michigan is well on its way to becoming one of the giants in online gaming.”