NJ Sports Betting Revenue Drops Following NY Launch

Within the first month since New York’s online betting launch, more than $2 billion has been collected in wagers, $80 million gained from tax revenue, and a quarter of New York’s entire mobile-sports wager in the Super Bowl. 

These statistics are an astonishing and promising start for New York as the state has easily outpaced Nevada, the country’s gambling capital, and New Jersey, which legalized mobile sports betting sites, such as WSN.com, in 2018. 

NY’s Success May Signal a Turnaround For the Industry

The unexpected evolution of New York into the country’s largest betting market is part of a dramatic post-Covid turnaround for the gambling industry as a whole. It is also a symptom of New York’s and the nations’ growing thirst for sports betting, a trend that addiction experts are concerned about. According to the American Gaming Association, Americans gambled upwards of $57 billion on sports in 2021, a record exacerbated by the fact that casinos and other gambling establishments returned with their top-grossing year ever. Table gaming and slot machines were the favorite staples. 

In New York, where newfound taxes from online betting has swiftly surpassed expectations, bettors have placed over $2.4 billion in wagers through February 13, including a whopping $472 million for the week leading up to the Super Bowl. A wave of promotions from betting platforms has fueled the frenzy, including oversized payoffs, risk-free bets, and heaps of free credits added to players’ accounts. All of which are calculated short-term losses for many businesses as they compete for market share dominance. 

How NY Compared to the Other States

There also might not be a correlation due to the sheer size of New York. New York’s huge launch is due thanks to its huge population. Of the 20 states that already permit people to bet on their mobiles, New York is the most populated, with potentially bigger participants like California and Texas still on the fence and contemplating their entry. 

However, the appetite for wagering in New York is undeniably high. According to many gambling research and statistics sites, over a fifth of the nation’s mobile bets on the Super Bowl originated from within the state of New York. The president of the gaming association, Bill Miller, even attested New Yorkers are die-hard sports enthusiasts who have long been enthusiastic sports bettors who did not have the legal option which they have been just granted. 

Sports betting supporters argue that new betting platforms in New York and elsewhere are part of the legalization of previously unlawful betting choices such as foreign gambling websites and street-side bookmakers. Furthermore, in certain places, COVID times may have hastened the change, with Covid-related shutdown and measures fueling a thirst for online gambling. Confusing? Simply put, the statistics coming out are not that surprising as sports betting is an already popular pastime. 

Consequences of the Launch

Although the state’s tax profits have been through the roof, New York should be wary of its New Yorkers. Simultaneously, gambling-related organizations are concerned that the accessibility and speed of mobile sports betting — which includes the option to wager on play calls in a game — will entice newbies and seduce those who are attempting to rehabilitate. 

In support of this worry, the state’s Office of Addiction Services and Supports reports that calls to its gambling assistance hotline have increased by 46% for this January compared to the previous January. This indicates that new public awareness efforts regarding responsible gaming have been successful in educating New Yorkers. 

Which Sports Are The Most Popular?

Professional sports leagues have been wary about betting for years, fearful of game-fixing or other illegal activity, a notion that extends back to the 1919 World Series Black Sox affair. However, lately, they’ve warmed up to the idea. After all, betting adds excitement to even the most boring games, ensuring that spectators and marketers stay tuned in. And of course, the massive influx of cash is a very convincing factor. 

Football has always been the most successful and favorite betting sport, but gambling businesses are getting better at coming up with new wagers for slower games like baseball and even golf. No doubt, some of these ‘creative’ wagers have been ridiculous, such as a Super Bowl wager on the color of the Gatorade when the winning coach is splashed.

Future Updates

As of late, New York has already taken an astonishing $78.5 million in taxes to fund education, which is easily almost $30 million more than what the state budget office initially estimated for in the first three months of 2022. This estimate has since risen to $110 million, and the state has already collected $200 million in licensing fees from other operators.

Additional gaming possibilities could be on the horizon. Randy Levine, the president of the New York Yankees, indicated that has been backing for a betting kiosk at Yankee Stadium last week, following the pattern of other major sports teams. 

This idea would indeed be part of a bigger extension of betting into sports venues. There has also been advocated for the creation of new, traditional brick-and-mortar casinos with attached betting booths and numerous developers seeking to build a casino in New York.

Conclusion

Analysts say they have not seen a drop-off effect in betting revenues in adjacent states like New Jersey while New York has risen to the tip of the pyramid. Even fervent fans in New York believe their state’s rapid and substantial success will fade at the end of April after March Madness (the month-long tournament featuring hundreds of critical college basketball games).  Experts also believe that part of New York’s spectacular results is due to “free money” from early promotions, which are expected to dwindle or cease to exist in the following months.

Sports betting experts also conclude that the market’s true scale will only become obvious in around September, around the time college football and the NFL’s next season begin. The market takes roughly six months to stabilize, which is when the statistics will most accurately reflect reality. The amount of money wagered, also known as “handle”, would fall in the months ahead. However, it is also expected that bets would continue to pour in. 

Leave a Comment