Online Sports Betting Giants Face Hurdles in Nevada
Nevada, a name synonymous with gambling, has ironically become an obstacle for major sports betting operators. The state's in-person registration requirement for mobile wagering accounts is preventing industry leaders like FanDuel, DraftKings, Fanatics Betting and Gaming, and ESPN Bet from fully operating within its borders.
The State of Play
Despite Nevada's restrictive laws, the sports betting landscape across the United States continues to evolve rapidly. Currently, 35 states along with Washington, D.C., offer legal sports betting, providing fertile ground for operators to expand their reach. Fanatics Betting and Gaming, for instance, has successfully launched a sports betting app in five states and has plans on the horizon to venture into eight more.
Similarly, ESPN Bet is poised to begin operations in 16 states come November. This follows a massive $1.5 billion deal with Penn Entertainment, marking a significant milestone in the company's expansion strategy.
Nevada's Unique Stance
Interestingly, despite being a hub for gambling, Nevada still requires sports betting to be tied to a sportsbook inside a casino. This stipulation also mandates that the sign-up location for mobile wagering accounts be these physical sportsbooks. As a result, without DraftKings or FanDuel, Nevada’s top two sports betting operators have emerged as BetMGM and Caesars Sportsbook.
However, it's worth noting that both FanDuel and DraftKings are not entirely absent from the Nevada scene. They simply do not operate as traditional sports betting operators. Boyd Gaming, for example, owns 5 percent of FanDuel and operates retail and mobile sports betting at 15 of its regional casinos in eight states. Meanwhile, DraftKings has established a significant presence with more than 1,000 employees in Southern Nevada through its local headquarters.
Industry Perspectives
Despite the restrictions, industry insiders have offered interesting perspectives on the situation. Chris Krafcik, an analyst, pointed out that "Nevada, which accounts for a little more than 1 percent of the U.S. online gambling revenue, is not a must — not even close — for FanDuel and DraftKings." This sentiment underscores the fact that the sports betting market extends far beyond the borders of Nevada.
Jason Robins, presumably from DraftKings, also weighed in, stating, "We're in one of the most competitive markets in the world. Anyone who thinks that it's over in the first inning is just foolish." His comments reflect the dynamic and evolving nature of the sports betting industry.
Looking ahead, there seems to be a consensus that changes to Nevada's regulations may not happen soon. Yet, as Jason Robins put it, big brands are "ready to spend with big brands, a real vision and with good people." ESPN Bet, for instance, plans to integrate its brand across all platforms, with anything referencing odds being branded as ESPN Bet. Despite the challenges, it's clear that the game is far from over in this highly competitive market.