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Place your bets: State taps nine firms to offer mobile sports betting across New York

Place your bets: State taps nine firms to offer mobile sports betting across New York

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Seneca Buffalo Creek Casino Sports Lounge (copy)

The Seneca Buffalo Creek Casino began taking sports bets in 2019. 

ALBANY – Whether the Buffalo Bills will be a betting option for gamblers drawn to the 2022 Super Bowl is, well, up to the Buffalo Bills.

But no matter who is playing, the odds that legalized online wagering on the high-betting game is in place in New York by February increased Monday with the awarding of sports betting licenses to two groups of companies – totaling nine firms in all – that represent a who’s who of gambling interests.

In a move that will dramatically increase gambling activity in New York, state regulators Monday selected the ways and the means by which betting on sports contests via computers and smartphones will get underway early next year in a move that will generate billions of dollars in gambling wagers over the next decade.

The companies selected will pay 51% of their gross wagering revenues to the state – far more than places like New Jersey – in return for the rights over at least 10 years to be the ones to set odds and devise ways to lure sports bettors away from offshore accounts and other means now illegal in New York.

The action by the state Gaming Commission was the last major hurdle ahead of the switch being turned on for the state’s new mobile sports wagering program – one many fans have been craving that also risks worsening gambling addiction problems for many New Yorkers. The initiative will allow gamblers to place their bets on an array of possibilities involving pro and most college sports contests, as long as they have enough money in their gambling account and a connection to the internet.

After mobile sports betting was made legal earlier this year in the state budget, the state Gaming Commission, charged with devising the nuts and bolts of the program, Monday tapped two groups:

• Sports Information Services Ltd., doing business as “Kambi," a European sports betting technology firm whose partners in the New York deal include Caesars Sportsbook, Empire Resorts, PointsBet, Rush Street Interactive and WynnBet. The Oneida Indian Nation also has a stake in that group.

• Betfair Interactive US LLC, doing business as FanDuel Sportsbook, with its partners that are Bally’s Interactive, BetMGM and DraftKings.

State officials believe a mature online sports betting market in New York will bring the state nearly $500 million in annual revenue.

State officials and gambling executives believe online betting – which will be permitted anywhere within the state’s geographic borders – will be available in time for the Super Bowl in February. New York is expected to make a serious play to challenge New Jersey as the nation’s busiest mobile sports betting hub.

Getting less attention leading up to Monday’s Gaming Commission meeting was another item on the agenda to expand gambling options: The panel took a first step to legalizing online betting on raffles conducted by registered charitable groups, from fire houses to fraternal organizations to the Buffalo Bills Alumni Association.

That initiative, which charitable groups say is needed to stay competitive with New York’s many other forms of gambling, has been slothlike in the making; a measure legalizing online raffles was signed in 2017 and supposed to have been in place by June 2018.

But the measure was held up by the former Cuomo administration-run Gaming Commission; the passage of the plan on Monday kicks off a public comment period for the proposal, meaning it will be at least 60 days before a final rule can be adopted.

Mobile betting on sports contests won’t happen overnight. There are a variety of logistical hurdles that still have to be met, such as companies getting independent outside firms to approve their geolocation systems – which is the method by which bets will be confined strictly to within the borders of New York State. Such systems are already in place in other states, including New Jersey, which has seen people cross state lines in order to place an online sports bet.

The rule regulators approved Monday states that operators must show how their geolocation systems will alert wagering companies of potential risks “and fraudulent activity” and give both the licensees and the state “real-time data feeds of geofencing feeds and potential risks.”

Most immediately, the winning licensees in the coming 30 days will have to open their wallets and send New York State $25 million apiece for the right to offer mobile sports betting.

Also, they have to get computer servers in place through which wagers will be processed.

To accommodate legal concerns, those servers must be located at one of the state’s four commercial casinos. That’s because sponsors of the law crafted it in such a way so that mobile sports bets are considered “made” at the location of the servers, not, for instance, in downtown Buffalo where bettors might be making their actual gambling selections on their phones.

Unlike when the state legalized commercial casinos, this new form of gambling in New York did not get approved via a constitutional amendment by voters statewide. Rather, it was included in April into some of the thousands of pages that went into making up the 2021-2022 state budget.

That law approved an array of features of the new sports betting program, including the number of “platform providers” and “skins," which are the public-facing companies through which people will sign up to make wagers.

The New York Council on Problem Gambling advocates for gambling treatment services, but does not take a stance on gambling. James Maney, the group’s executive director, said any new increase in ways for New Yorkers to wager could see “potential increases in problem gambling or increases in gambling activity amongst our vulnerable populations and youth.”

The group said the state and mobile sports betting industry can take a number of steps, including regulating the volume and placement of advertising and having the gambling companies spend a “significant portion” of their ad budgets to promote responsible betting and ways for those with problems to seek treatment.

Maney’s group estimates there could be as many as 600,000 adults in the state struggling with gambling problems.

Adam Greenblatt, chief executive officer of BetMGM, an entity whose interests in New York include a racetrack-based casino in Yonkers, thanked the Gaming Commission for sticking to its timetable to award the licenses before early December, adding that “New York has the potential to be one of the largest sports markets in the U.S.” He said winning the New York bid was seen as “vital” to ensuring the company’s “nationwide leadership in sports betting.”

Sports betting has been legal for a couple of years in New York, but only via in-person wagers at the state’s four commercial casinos, as well as at Seneca Nation and other Native American gambling halls.

The Seneca Nation did not comment Monday.

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