The Washington D.C. council will tomorrow hold a meeting on the region’s sports betting program and comprehensive underperformance compared to initial expectations, and what can be done to enhance performance to compete with sports wagering programs in neighbouring states Maryland and Virginia.
What is the structure of D.C’s sports betting?
When a law was passed in 2018 to legalise sports betting in the District of Columbia, exclusivity was granted for district-wide mobile wagering to the D.C. Lottery, with Intralot having a US$215m contract approved in July 2019 to provide sports wagering and related services for the District of Columbia’s Office of Lottery and Gaming.
Private operators are permitted to partner with stadiums and arenas in the district to offer on-site wagering and mobile betting within a small distance of the facility. Currently William Hill (Caesars) and BetMGM offer retail-based services in the State, with FanDuel becoming the third late last week, opening up services at the MLS stadium (Audi Field) home to D.C. United .
What’s wrong with D.C’s sports betting operation?
The Office of the District of Columbia Auditor released a report in September 2021 to determine and compare the levels of return to the state compared to similar jurisdictions. The report found that Gambet DC (the State lottery) had low handle, but high margins, and was struggling to attract consumers in the region and as such was underperforming.
The report compared GambetDC’s mobile wagering platform to the following states:
In the majority of States whereby mobile wagering is available, up to 90percent of the states handle is generated through mobile. District of Columbia’s mobile wagering is weaker than its retail, with the return to the state fund significantly lower. Between May 20 and Mar 21, GambET D.C. paid US$440,000 to the state fund, with US$3.93m going to Intralot to manage GambetDC.
In comparison William Hill’s retail operation generated US$1.4m for the State despite launching two months later.
What’s changed since the report?
The report recommended an increase in privately operated sportsbooks (run by the lottery) as well as increased payout to bettors; both of which were enacted. The payout cap rose from 80 percent to 90 percent and additional retail premises were secured.
The District’s then CEO, Jeffrey Dewitt, initially projected that the lottery program would result in US$9m in transfers to the district through the end of the fiscal year 2022. According to projections from the lottery, the actual figure for FY22 is expected to be around US$1.8m.
The meeting, taking place on July 13th will seek to assess whether changes have been implemented and to take feedback and learnings from elsewhere in yet another effort to revamp what’s been thus far a failing betting app endeavour.
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