Industry hopes that the proposed sports-betting bill would lead to regulation in Massachusetts could potentially improve the state’s Wedge Index rating.
The bill was tacked onto the Massachusetts House Ways and Means Committee’s economic development bill at the end of the state’s parliamentary session in late July.
Regulation would represent a major fillip for operators wanting to offer regulated betting in a state with 7m inhabitants. It will offer strong growth opportunities for the industry.
Improved standing
It would also boost Massachusetts’ standing in the Wedge Index where it is currently in T18th position. Adding mobile betting and remote registration could lift the state to the edge of the top 10.
However, significant details still need to be ironed out if the bill is to pass.
Massachusetts is surrounded by states that offer regulated sports-betting to their residents and the economic logic for passing the bill is generally accepted.
But competing stakeholders want to have their interests protected. These include the state’s three land-based casino operators, the Massachusetts Lottery and DraftKings.
Not coincidentally, perhaps, DraftKings is headquartered in Boston.
Who’s in, who’s out
The key issues that will need to be resolved:
- Whether betting licenses will have to be linked with land-based casinos (skins or sub-licenses)
- If the state lottery will be allowed to sell its products online. It isn’t currently and revenues have been badly hit by social distancing measures
- Whether lottery agents and bars and restaurants will be allowed in on some of the regulated betting action
The proposal would allow for a wide range of stakeholders. One of the bill’s most striking features is that online operators would not be required to partner with a land-based casino as is the case in New Jersey and many other states.
Industry observers believe that this concession was argued for by DraftKings. If agreed to, it would be a major bonus for new entrants as they would not be required to have a casino agreement in place before applying for a license.
Potentially it would also enable a large number of license applications, thus generating more licensing fees while providing a much more competitive environment for operators.
More licensees would also impact the Wedge Index rating.
Three license types
Currently three types of sports-betting licenses would be available:
- land-based casinos to offer retail and online sports-betting
- retail betting at live racing venues
- daily fantasy sports operators licensed in the state for at least one year and that offer sports betting in at least two other states to offer online sports-betting
The details of the bill need to be agreed between the stakeholders.
But with the economic impact of Coronavirus and its late introduction there is hope agreement can be reached.
