A big step
ESPN Bet will soon launch in the biggest sports betting market in the US after securing market access in New York. The brand’s operator, PENN Entertainment, is buying WynnBET’s licensing entity for $25m.
ESPN Bet will still need to get the relevant regulatory approvals
In 2021, WynnBET operator WSI LLC obtained the green light from the New York State Gaming Commission to launch an online sportsbook after paying an initial fee of $25m. ESPN Bet will still need to get the relevant regulatory approvals before launching at some point in 2024.
Commenting on the news, PENN Entertainment President and CEO Jay Snowden deemed it an important development, adding that in partnership with ESPN it’s “building a brand that is synonymous with sports betting.”
A major market
New York sportsbooks have posted larger monthly handles than any other state every month since launching, except one. Total handle was $19bn last year and gross gaming revenue reached $1.7bn.
DraftKings and FanDuel have dominated about 80% of the New York market since its launch in 2022, with the remaining seven licensees trying to survive on the scraps.
While revenue for sportsbooks is good due to the large volumes, operators do have to pay a 51% tax on revenue. PENN CEO Snowden said in 2021 that he did not think that any operator would be able to make money in New York due to the hefty tax rate.
PENN Entertainment was unable to secure a license in New York when it previously operated the Barstool Sports-branded sportsbook.
In opposite directions
ESPN Bet officially launched in November after entering a $2bn ten-year deal with PENN Entertainment. It initially went live in 17 states and gaming consultancy firm Eilers & Krejcik estimates that the operator has an 8% share of the US market since going live, which would put it only behind FanDuel and DraftKings in the rankings.
WynnBET is going in the other direction, winding down its operations across the country after failing to capture the public’s interest in a meaningful way. It announced in August that it was leaving eight states so that it could better focus resources elsewhere.
will soon only have online sportsbooks in Michigan and Arizona
WynnBET also informed the Massachusetts Gaming Commission earlier this month of its upcoming departure from the state. WynnBET will soon only have online sportsbooks in Michigan and Arizona, as well as retail offerings in Massachusetts and Nevada.