Upping the ante… NY legalized mobile sports betting this weekend, just in time for yesterday’s college-football championship and next week’s NFL playoffs. Before, New Yorkers had to enter New Jersey to bet on sports. Now they can gamble from their couches. Last year US gamblers spent $40B betting on sports — double from 2020.
What happens in Vegas… hasn’t stayed in Vegas. Since the federal sports-betting ban was lifted in 2018, 30 states and DC have legalized live sports betting, but only 18 have legalized mobile betting. NY is the largest state yet to go mobile, but NJ has the highest gambling revenue of any state, snagging one-fifth of the US’s gambling bucks.
The house always wins… but it doesn’t necessarily win big. As gambling is legalized more widely, betting companies’ revenue is expected to 5X by 2026. But new markets don’t guarantee bigger profits: NY’s 51% tax on gambling revenue — 4X as high as NJ’s — will eat into apps’ profits as they grow. Shares of DraftKings and PointsBet have fallen more than 60% over the past year as the companies splurged to compete for customers.