The Week In Sports Betting News: Does Tenn’s 10 Portend Trouble?

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Happy Monday, everyone. It’s been more than five weeks since we’ve had major sports, but there is still plenty of sports betting news each week.

Remember to subscribe to the LSR Podcast to get a breakdown of the week’s biggest stories. The most recent episode dives into the details of the biggest non-coronavirus sports betting story of the year: election betting in West Virginia.

And as always, give us a follow on Twitter @LSPReport to hear about the stories in the weekly recap as they happen in real-time.

Top sports betting news: TN approves minimum hold

For a bit, it seemed like cooler heads might prevail in Tennessee when it came to a short-sighted idea about capping payouts.

That, unfortunately, was not the case.

The Tennessee Education Lottery Corporation approved a 10% minimum hold for mobile sports betting operators. That could be revisited after one year.

This is, naturally, expected to handicap Tennessee’s sports betting market. Only two states, Mississippi and Delaware, have exceeded a 10% hold rate.

Neither state offers mobile betting, while Tennessee will be mobile-only. And Delaware still does a decent amount of sports betting business through its lottery retailers, which only allows parlay betting.

Tennessee originally wanted to mandate a 15% hold. Gaming consultancy Eilers & Krejcik Gaming estimated that it would cost the state $11 million in annual taxes and cut the number of interested operators in half.

FanDuel US results: Surprisingly decent

Online gambling has helped mitigate the absence of sports betting for FanDuel Sportsbook in the four weeks since sports shut down from March 15.

Flutter, FanDuel’s parent company, reported an 8% revenue decline in that four-week period compared to last year. The 46% drop in sports betting revenue was partially offset by the 200% increase in gaming revenue.

Horse betting via the company’s TVG brand also played a role in keeping some sports revenue afloat.

FanDuel Sportsbook said it acquired 100,000 new customers since the beginning of this year and now has more than 450,000 since its initial launch. The company has about a 41% market share in the country.

Its merger with The Stars Group remains on track for the second quarter pending shareholder and regulatory approvals.

Bad timing for MA sports betting push

Massachusetts Sen. Brendan Crighton would have bet on his state legalizing sports betting had he been asked when the bill advanced from committee.

The problem with the timeline, though, is the bill passed on March 12, the day after the NBA suspended its season because of the coronavirus pandemic. Since then, much of the country has come to a standstill and legislatures have had more pressing issues.

That means passing the bill at this point is likely a long shot, he told LSR last week.

The bill would have legalized online and retail sports betting and worked in NCAA betting. That was previously excluded from a proposal by Gov. Charlie Baker.

Virginia sports betting bill gets tweaks

Gov. Ralph Northam had a couple of recommendations that kept him from signing Virginia sports betting into law.

One of those includes bringing in Virginia’s NASCAR tracks on the action. The tracks were previously excluded from the definition of a major league sports franchise that could receive a sports betting license.

Northam also wants the entrance into Virginia to be more expensive for operators. He included a $50,000 charge to cover the background investigation of each principal in a sportsbook operation.

As many as 20 employees could fall into the state’s definition of a principal, operators told LSR, which means those startup costs would hit more than $1 million. And that doesn’t include the $250,000 required for a three-year license.

Legislators and regulators could be open to revising that fee structure, one source told LSR.

CO sports betting launch remains on track

Licensed Colorado sports betting operators showed enthusiasm for a May 1 launch despite the absence of major sports, according to Dan Hartman, director of the Division of Gaming.

The regulator is, therefore, making final preparations for operators to go live on that date. The state has 25 online sportsbooks and 19 retail sportsbooks that could launch that date. Retail books come with a caveat, however, as casinos around the country remain closed.

There were plenty more licenses approved at last Thursday’s meeting, including online sports betting licenses for SuperBook, Betfred, Wynn and BetAmerica. The technology suppliers for the latter two, Betbull and SBTech, also received vendor licenses.

Hartman expects 85% of handle to come from online. While other states have had to ramp up to those levels, it could take Colorado significantly less time to get there. Retail betting and casinos are only allowed in three towns and Colorado allows remote registration for online sportsbook accounts.

Lack of sports makes NFL Draft more enticing

One of the biggest news stories when it comes to sports betting is what is actually available for betting. With limited choices, it looks like the NFL Draft will make a bigger splash for sportsbooks this year than last year.

DraftKings Sportsbook told LSR its draft handle is already higher than 2019 more than a week out from the first round on Thursday.

More is expected, too, as more than 90% of DraftKings’ handle on the event came in the 10 days leading up to the draft.

PointsBet also expects an increase in handle. The company estimates about 2.5 times more than last year, which would put it in the range of a standard Monday Night Football game.

There should certainly be more eyes on the draft this year, at the very least, to see if it’s a train wreck. The NFL is conducting the draft virtually with Commissioner Roger Goodell kicking the event off from his basement in New York.