A proposed bill from the DC Council could be set to break up the de facto monopoly held by the DC Lottery in the region’s mobile sports betting market if passed.
The draft legislation, proposed by Councilmember Elissa Silverman, would open up the sports betting market to traditional big players such as DraftKings and FanDuel after the DC Lottery’s app, GambetDC, has been hit by unrelenting criticism.
DC mobile sports betting market could expand after GambetDC criticism
Under the proposals, titled Sports Wagering and Fair Competition Amendment Act of 2022, any company would be allowed to apply for a license to operate online and mobile sports betting apps in the district.
Moving in a similar direction to states such as Virginia and Maryland, operators would be liable to a 15% tax rate.
Another major measure would see the district terminate its deal with Greek gambling and lottery firm Intralot in 2024 when its current deal expires. The deal with Intralot sees the firm receive $215m to run the lottery and sports betting operations, which wasn’t short of criticism at the time of announcement.
As such, any future deal would require ‘competitive bidding’ and the industry in the district must ‘get serious about profitability’ after, in a dramatic revelation, it was revealed that sports betting in DC ran at a $4m deficit, attributed to high marketing costs.
Silverman was one of five council members who voted against the original deal with Intralot, therefore, it is no surprise that she would envisage the deal being terminated.
Announcing the proposals, Silverman commented: “We need to turn the page on this embarrassing episode.
“Residents deserve an online app that works, taxpayers deserve a program that brings in money for the District, and we all deserve a system where we don’t hand huge contracts to a preferred company and its subcontractors without even looking at the competition.”
What went wrong for GambetDC?
Launched in 2020, DC’s sports betting program through GambetDC was expected to rake in $25m per year for the district budget, yet losing that aforementioned $4m in 202, with an array of errors to swell the pain felt.
In September 2021, an audit conducted by the District of Columbia Auditor ruled that the pp had ‘failed to meet expectations’, which consequently led to a change in leadership.
Frank Suarez was appointed as executive director and was tasked with rebooting the GambetDC app following the audit.
However, the disappointment wasn’t thwarted by Suarez’s arrival, with a ‘colossal’ technical error leading to the Apple version of the app offline during the Super Bowl, which could have proven a lucrative night for the program.
Technical errors aside, the app has been lambasted for its user experience, with even Suarez admitting that it required interface updates, whilst Silverman’s office labeled it as ‘difficult to use’.
All this has led to this proposed bill to broaden mobile sports betting in DC and allow competition.
“If we’re going to have a lottery and a sports betting program, let’s at least make it a revenue generator for the city so it can fund important efforts in public safety, public education and housing,” Silverman added. “And let’s stop the bad practice of awarding lucrative contracts without competition.”