Business By The Books: Can DC Sports Betting Thrive With MD Live?

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There has been an interesting phenomenon over the past few months in Washington DC: use of Intralot‘s sports betting product is growing.

Handle from GambetDC‘s online betting and more than 60 locations with in-person kiosks has grown for 11 straight months. Unsurprisingly, that is around the time DC’s Office of Lottery and Gaming ended its attempt to hold 20% of wagers each month.

Handle from private operators with geofenced mobile books and/or kiosks, meanwhile, is down the past eight straight months.

It is unclear if there will be another push to change DC sports betting and allow private operators full mobile access to the District after Councilwoman Elissa Silverman lost her seat last year. It may not matter, though, with Maryland sportsbooks ramping up from November mobile launch.

Sports betting kiosks a larger part of the picture

GambetDC’s expanded kiosk program brought in $4.4 million in handle and $870,000 in revenue through the fiscal first quarter from October through December, according to figures provided by the OLG. Compare that to the $9.9 million in handle and $1.9 million in revenue from all of fiscal 2022.

Those kiosks are also on pace to transfer more this year than last, with $275,234 in DC Lottery profits so far in fiscal 2023 compared to $727,868 all of last year. Total transfer is expected to be down, though, to $2.4 million from $2.7 million last year.

With GambetDC finally offering competitive odds, it seems more bettors are taking advantage of the convenience of kiosks instead of traveling to place bets on the Caesars or BetMGM apps. Bettors placed 227,273 bets in the first quarter on those kiosks, compared to 533,044 all of fiscal 2022.

The October-December quarter, of course, is typically the strongest for US sports betting operators. The next few months will be crucial to whether GambetDC turned the corner in enough time or will eventually lose out to Maryland.

Odds now more comparable to national books

Take a trip back to March 2020, when Intralot’s first sports betting product debuted in Montana. Sports Bet Montana offered prices that were far off what the rest of the market saw at the time, with some college basketball sides priced as high as -135.

While the lines are still a bit pricier than national operators, there is not as large a gap. Caesars, the biggest competition for GambetDC, is offering standard -110 lines on NBA spreads Monday night. Gambet, meanwhile, priced those spreads between -108 and -120.

MD-based bettors decent chunk of GambetDC database

GambetDC will be affected this year by Maryland’s launch, Executive Director Frank Suarez said at a recent DC Council meeting.

In fiscal 2022, customers with Maryland addresses accounted for:

Post-PASPA sports betting handle

Sports betting handle since PASPA was struck down in May 2018 topped the $200 billion mark in January.

Unfortunately, the $200.168 billion publicly reported is the most concrete number in the industry right now. Sports betting revenue is a much different story because of the mix of net and gross revenue reported by various states.

The $15.4 billion reported has led to $2.554 billion in tax revenue, with New York sportsbooks to thank for nearly $800 million of that.

GeoComply appeals Xpoint ruling

The geolocation wars are not over just yet, as GeoComply appealed the District Court’s decision in favor of Xpoint to the Federal Circuit‘s appeals court.

In a statement, GeoComply said IP rights and the innovation behind them are “principles worth defending:”

“While we respectfully disagree with parts of the district court’s decision, we are gratified that the court recognized Xpoint may infringe multiple claims of GeoComply’s patent. GeoComply intends to continue pursuing any claims it may have against Xpoint for violation of its intellectual property and technology rights.”

Xpoint did not sound surprised or fazed by the appeal:

“We are confident that the Federal Circuit will affirm Judge Bryson’s invalidation of GeoComply’s patent. Our customers and state gaming regulators benefit from having a competitive and innovative marketplace for this business-critical service, and we look forward to serving these customers.”

Endeavor expects OpenBet revenue growth

Endeavor, which bought OpenBet from the former Scientific Games last year, expects the segment to grow in 2023.

The sports data and technology segment, which includes OpenBet and IMG Arena, should grow double digits on 2022’s projection of $340 million in revenue for the two businesses.

Revenue and adjusted EBITDA will be skewed toward the fourth quarter with sequential growth throughout the year, CFO Jason Lublin said on the company’s fourth-quarter call.

OpenBet brought in $50 million in revenue for Endeavor last year following the September acquisition.

Where was Bally’s advertising in 2022?

Bally Bet’s struggle to gain even modest market share in most states could be a mix of lesser product and lack of exposure.

According to Bally’s 10-K, the company spent just $26.8 million on advertising for all of 2022. That was up from $7.5 million in 2021. Compare that to DraftKings, which increased its advertising budget by $133.9 million in 2022 and spent $1.2 billion on sales and marketing for the year.

Bally’s wanted to make sure it had the product right for Bally Bet before advertising much, but that never happened. New CEO Robeson Reeves said the purchase of Bet.Works for its platform was a “mistake” on the company’s fourth-quarter call.

Bally’s expected its sportsbook to acquire customers mainly through its Bally Sports regional sports networks and various funnels like Monkey Knife Fight.

Those regional networks are facing bankruptcy, though. Monkey Knife Fight, meanwhile, shut down for good last week.

BlueBet expanding US sports betting business

Australian-listed BlueBet, known under its B2C name ClutchBet in the US, is expanding to more states over the next few months.

The company launched its first market, Iowa, last year. The brand was ranked 10th by revenue and 13th by handle among the state’s 19 operators in BBT’s fiscal second quarter.

ClutchBet should launch in Colorado later this month and is going through the licensing process in Louisiana and Indiana, according to its earnings release. It is also progressing in talks to sell its B2B service to other operators.