Penn Secures Sports Betting Permit in New York from WynnBet in New York's Context
U.S. Gaming Company PENN to Enter New York Sports Betting Market with ESPN Bet
As per the company's announcement, PENN will procure the New York sports betting license previously held by WynnBet [article in English] at a price of $25 million (roughly €23.3 million).
PENN CEO Jay Snowden emphasized the importance of this deal for ESPN Bet's expansion:
This move signifies a significant step in bringing ESPN Bet into the most significant controlled online sports betting market in North America. Conducting business in New York is crucial for ESPN Bet's growth across the entire U.S. – Jay Snowden, PENN CEO, Source: PENN
Since WynnBet had expressed its intention to exit the market, there was no haggling over a higher price during negotiations. The $25 million fee is consistent with the amount each sports betting provider in New York has to shell out for their license [article in English].
Tussle for Limited New York Licenses
So far, nine entities have held the sports betting license in New York and have been authorized to operate as online bookmakers:
- Bally Bet
- BetMGM
- BetRivers
- Caesars
- DraftKings
- FanDuel
- PointsBet (now under Fanatics management)
- Resorts World Bet
- WynnBet (to be replaced by PENN)
With WynnBet exiting, PENN will now step into the void and likely debut ESPN Bet in the market. However, PENN isn't the only player eyeing the Big Apple in 2024.
Sports betting provider Fanatics fully acquired PointsBet's license [article in English] as early as June 2023, as reported by industry magazine iGaming Business.
Though Fanatics has completed the acquisition and received the green light from the New York State Gaming Commission, the rollout of Fanatics' offer in New York remains uncertain.
New York's Online Sports Betting Market on Upswing
Despite New York limiting licenses and imposing high entry barriers, online sports betting continues to thrive and smash records.
In addition to the $25 million licensing fee, annual expenses of at least $5 million as compensation for brick-and-mortar gambling options, and a 51% tax on sports betting companies' revenues, New York requires gamblers to cough up a $5 million annual fee for offering sports betting online.
New York has also tied the issuance of land-based casino licenses to stringent conditions, yet there are still a plethora of applications and plans for potential casino complexes. Nevertheless, New York does not appear to be venturing into online casinos, an omission experts attribute to overlooked potential revenues in the budget.
Anticipated Launch Dates
PENN remains vague about when the ESPN Bet sports betting offering in New York will be released. The company has only announced a launch during 2024.
However, the New York State Gaming Commission must first approve it. Following approval, the commencement of operations would be feasible.
The Fanatics case, still on the sidelines months after acquiring PointsBet, suggests that delays cannot be ruled out.
After securing the New York sports betting license from WynnBet, PENN is eager to introduce ESPN Bet in the market, aligning with Jay Snowden's growth strategy for the platform. (News: PENN acquires WynnBet's license in New York)
Meanwhile, Fanatics, having fully acquired PointsBet's license, looks forward to entering the New York sports betting market, although the exact launch date remains uncertain. (News: Fanatics acquires PointsBet's license in New York)
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