New York has lost out on millions in revenue since retail betting launched in July 2019, but the legislative push to add online sports betting could make the state the largest US sports betting market if properly structured, according to a white paper authored by PlayNY, a leading source for news and analysis of the fledgling New York gaming market.
Authored by PlayNY analysts Eric Ramsey, Dustin Gouker, and Matthew Kredell, The State of New York Sports Betting: An Examination of the Forces Shaping the Market, explores the nuances of the New York market.
Among the topics covered is the manner in which New York has underperformed with only in-person sports wagering and the proposed legalization efforts in the state from the legislature and the governor’s office.
The paper also examines the legal issues at play as New York contemplates legalization and addresses the opportunity in terms of revenue and total betting activity.
Lastly, it takes a look at who the major players are likely to be in a legal online sports betting market and assesses what other states have done with sports betting legalization.
“New York is a complex market, but one that the entire US gaming industry is watching intently,” said Ramsey. “There are so many factors at play in the charge to regulate online sports betting, including Governor Andrew Cuomo’s political fate.”
The debate on whether to legalize online sports betting and how to structure the regulations around it remains ongoing, with a resolution, at least for this year, possible this spring.
But much could change before that happens. For one, two major factions have developed in the debate of how to structure online gambling. One, supporting an open market that would invite multiple private operators to compete in the state, a movement led by Assembly member J Gary Pretlow and Senator Joseph Addabbo Jr.
The other comprises a state monopoly model with which New York captures the lion’s share of revenue by contracting with a single sportsbook operator, a move championed by Governor Cuomo.
According to research by the PlayNY white paper authors, an open market could draw $37b in bets, more than $2.5bn in operator revenue, and more than $300m in tax revenue over the first four years after launching online sports betting. A closed market could draw $7.5bn in bets, $750m in revenue, but $375m in revenue for the state.
“The bottom line is we believe an open market will offer broader benefits for the state and its residents,” said Gouker. “But a closed market should produce more revenue for the state, and that is tempting for policymakers.”