Connecticut Lottery selects Fanatics as next sports betting partner
The Connecticut Lottery Corporation (CLC) has selected Fanatics Betting and Gaming as its next sports betting partner.
CLC said it had made multiple offers for its sports betting partners and Fanatics’ demo was the best.
Fanatics is the only true sports brand in gaming and has become an industry innovator. ” said Greg Smith, President and CEO of CLC. “We have been impressed by the Fanatics team and their entry into the U.S. sports betting market, and we are excited to see how they redefine the sports betting customer experience in Connecticut. "
Connecticut legalized sports betting in March 2021 as part of a gaming expansion plan that revised the state’s Class III gaming compact with the Mohegan Tribe and Mashantucket Pequot Tribal Nation.
These tribes are granted iGaming and retail and online sports betting privileges. In exchange for expanding gambling, the tribes gave up control of their gambling monopoly, allowing the Connecticut Lottery to partner with third-party sports betting operators for in-person and online sports betting.
Rush Street Exit
As the CLC launches its first round of tenders for its sports betting product in 2021, the neoliberalized gaming industry continues to be the talk of the U.S. gaming industry. Many traditional casino companies and start-ups are vying for entry and market share, which has resulted in CLC offering a rather rich offering from Rush Street Interactive.
Chicago-based Rush Street Gaming's digital gaming unit won the Connecticut Lottery's sports betting contest against 15 rivals by guaranteeing the lottery company a revenue share of at least $170 million over the 10-year partnership. Connecticut lawmakers set the overall tax rate on sports betting revenue at 13.75%, meaning Rush believes he could win at least $1.23 billion over the life of his contract.
Sports betting goes live in Connecticut on October 19, 2021. The tribes' sports betting partners, Mohegan Sun's FanDuel and Foxwoods' DraftKings, quickly captured much of the market, leaving little share for Rush's SugarHouse Sportsbook.
Million Dollar Sales
Between December 2022 and October 2023, SugarHouse Sportsbook generated just $9.17 million in online sports betting revenue. Total sales at the Connecticut Lottery's SugarHouse Sportsbook retail stores increased by $11.6 million.
Rush has pledged $170 million in tax revenue, suggesting the company will generate $123 million in total revenue annually. Less than two years after going live, that prediction was revealed to be wildly different from reality, with a shortfall of more than $100 million in the past 12 months.
In April, Rush announced the termination of its sports betting partnership with the Connecticut Lottery. The price of the spin-off has not yet been announced.
Fanatical Optimism
Rush isn't the only company to overestimate sports betting revenue. Others also recognize how weak the sports betting industry is. Many operators have given up, some notable ones include WynnBet, FoxBet and MaximBet.
Fanatics, by contrast, remains bullish on sports betting and is entering in a big way. The American apparel maker-owned company, which has licensing deals with the NFL, MLB, NBA, NHL, Formula 1 and NASCAR, entered Virginia earlier this month, joining Kentucky, Maryland, Massachusetts, Virginia, the seventh state after Ohio, Tennessee, and the Western States.
Fanatics founder and CEO Michael Rubin is on a mission to make Fanatics one of the largest sports betting operators in the United States. The Connecticut Lottery was apparently convinced by his company's pitch.
“CLC expects this collaboration to result in significant market share gains,” Smith concluded.
In addition to online sports betting, Fanatics will now operate self-service kiosks at CLC’s 10 retail sports betting locations. The highlight of the Lottery's retail sports betting operations is the recently opened XL Center Sports Bar & Sportsbook in Hartford.
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Source: www.casino.org
