DraftKings sees strong opportunity
DraftKings has partnered with Bay Mills Resort & Casino to offer mobile and retail sports betting in Michigan. No timetable has been given on when the sportsbook will begin operations.
Michigan becomes the seventh market in which DraftKings has a retail sportsbook, along with Colorado, Iowa, Mississippi, New Hampshire, New Jersey, and New York. It is DraftKings’ eighth mobile market.
The Wolverine State is an attractive market for DraftKings, as it is the tenth-largest state in terms of population, with an estimate 10 million residents. And while Bay Mills’ location in the Upper Peninsula on the Canadian border is less than ideal for foot traffic, DraftKings is expecting that the vast majority of wagers will come from mobile bettors, who can be anywhere in the state.
there is a sizeable market of willing bettors with no allegiances to any competing app
In its announcement, DraftKings said it conducted a study which showed out of Michiganders who were interested in sports betting, more than a third had placed a mobile bet by traveling outside of the state. More than half had never bet online, indicating to DraftKings that there is a sizeable market of willing bettors with no allegiances to any competing app.
Only retail betting until next year
Even though some sports around the world have restarted and it appears that the NBA and NHL are getting closer to action, DraftKings’ revenue in Michigan will be limited at the outset because mobile betting has yet to launch in the state. In fact, it is not expected to go live until 2021.
The rules for online and mobile sports betting have to be written and then go through many stages of review. Some lawmakers and stakeholders are hoping that Governor Gretchen Whitmer might invoke emergency rules to launch mobile betting sooner, but she has previously said that she would not do that.
Casinos waking from pandemic slumber
Governor Whitmer signed the bill to legalize sports betting in Michigan in December 2019. Unfortunately, the industry launched at exactly the wrong time: March 11, 2020, five days before Whitmer ordered casinos to close.
generated just $105,548 in sports betting revenue
Detroit’s three commercial casinos – MotorCity, MGM Grand, and Greektown – generated just $105,548 in sports betting revenue in those few days. And with mobile betting probably not going live until next year, there have been no options in Michigan for even limited sports wagering during the pandemic lockdown.
Though there are still not many sporting events on which to bet, gaming activity is ramping up in the state. Of Michigan’s 26 casinos, three reopened in time for Memorial Day weekend. Ten were open as of June 1 and most of the rest have announced that they will reopen within the next couple weeks. Bay Mills is reopening on June 12.
The three big exceptions are the Detroit casinos. Detroit has been hit particularly hard by the coronavirus, so it is the slowest part of the state to open back up. Governor Whitmer has said she hopes that the state can advance to Phase 5 of its reopening plan – the phase during which the Detroit casinos can likely welcome back guests – by July 4. The other casinos are tribal-run and are not required to abide by the governor’s lockdown orders, though most are.