DraftKings Readies PA Online Launch For Next Week

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The DraftKings-FanDuel rivalry is about to heat up in Pennsylvania, and the state is certain to see another big boost next month in online sports betting overall.

DraftKings obtained licensing approval from the Pennsylvania Gaming Control Board Wednesday morning as operator of an online sports betting site that will be affiliated with the Meadows Racetrack & Casino, owned by Penn National Gaming.

The Boston-based firm released a prompt statement that it would begin taking its first Pennsylvania bets as soon as Monday during a test period monitored by the gaming board.

“DraftKings is excited to receive our Sports Wagering Operator License, moving us one step closer to bringing our top-rated online and mobile Sportsbook app to sports fans in Pennsylvania,” said Tim Dent, DraftKings chief compliance officer. “Working in partnership with the outstanding team at Penn National Gaming, we expect the mandatory soft play period to begin on November 4th towards the goal of an official public launch a few days later.”

At least six betting apps in PA

Company representatives declined further comment until next week, but bettors can expect an app in Pennsylvania similar to those DraftKings already provides in New Jersey, West Virginia, and Indiana.

DraftKings will thus likely become the sixth online site for sports bettors in Pennsylvania. The only thing that would prevent that is if it is beaten to launch by European-based Unibet, which is tied to Mohegan Sun at Pocono Downs and has also indicated it will start its online/app site in November, without specifying a date.

With its wide marketing advantage as a long-recognized daily fantasy sports operator, DraftKings should immediately bolster the already fast-growing Pennsylvania sports betting market. That’s what happened when FanDuel entered the competition this summer.

In New Jersey, the two fantasy titans have been far ahead of all their online competitors in sports betting, with FanDuel No. 1 and DraftKings No. 2 in wagers and revenue. In Pennsylvania’s daily fantasy sports competition, however, DraftKings is the leader, with $1,582,253 in September revenue compared to $1,364,193 for FanDuel.

Pennsylvania’s sports wagering handle jumped mightily in September, aided greatly by the NFL’s start, to $194.5 mm from $109 mm the month before. FanDuel — aligned with the Valley Forge Casino Resort — was far and away the biggest earner with $85.1 mm in online handle.

DraftKings has offered nice incentives in other states

DraftKings will no doubt have a substantial media campaign and sign-up incentives in hopes of matching FanDuel’s numbers. In other states, DraftKings has typically offered new players a $200 risk-free first bet, five free $5 bets, and a deposit match of 20% up to $500.

Unlike the case in other Pennsylvania casino sportsbooks, DraftKings will have nothing to do with the retail operation or odds at the Meadows. The Washington County casino owned by Penn National Gaming opened its physical betting site Oct. 8, using odds provided by Kambi.

Due to Kambi’s ties to multiple Pennsylvania operators, gamblers will have fewer betting options than the full potential total once seven different casinos have an online presence next month, with several more expected to follow later. Both the Rivers Casino in Pittsburgh and newly rebranded Rivers Casino Philadelphia (formerly SugarHouse, before this week) employ Kambi to run their online sites. Those two sites are in the process of being unified as one, BetRivers. The Parx Casino also uses Kambi, although the casino sometimes adjusts odds to differ from those offered at BetRivers.

In addition to FanDuel, online bettors also can use FOX Bet, tied to Mount Airy Casino Resort. Though it would seem to have a strong brand, with its broadcast network tie-in, FOX Bet started relatively slowly in September, taking $4.5 mm in wagers during a partial month of operation.

Unibet is coming soon, but no date announced

Pennsylvania will be the second U.S. state entered by online operator Unibet, although it has been a sports betting presence in other countries around the world for years through its parent company, Kindred Group. Unibet launched in New Jersey this summer through partnership with the Hard Rock Casino in Atlantic City.

Unibet already services Mohegan Sun’s retail sportsbook, which opened in late September, and Kindred Group’s CEO announced during an earnings call Oct. 25 that it would be going online in Pennsylvania in November, without specifying a date. It will also provide online casino games for Mohegan Sun.

Unibet representatives did not respond to requests for comment this week on their Pennsylvania plans.

Based on the gaming board’s meeting, the operators of Philadelphia’s yet-to-open Live! Casino could also start an online site within several months. The casino received approval to take bets digitally before the casino itself opens in late 2020.

Representatives of Cordish Companies, the casino’s owner, said they are finalizing negotiations with an unidentified sports betting platform operator to handle the site, with hopes of launching late this year or in early 2020.

Questions surround mini-casino’s sportsbook fee

Cordish Companies has a thornier issue related to sports betting with its Live! mini-casino, also planned for a late 2020 opening, at Westmoreland Mall in Hempfield, Westmoreland County.

The casino is hoping to place a retail sportsbook in the satellite casino, but an initial gaming board interpretation of state law has suggested it could have to pay an additional $10 million license fee on top of $10 million for its Philadelphia casino’s sportsbook.

At a hearing Wednesday, Live! officials, with backing from local elected officials, stated a case that it would be financially unrealistic to pay an additional $10 million sports betting fee, considering relatively modest revenue generated by sportsbooks. They said such an additional fee was never the intent of lawmakers in passing a 2017 gaming expansion that authorized both mini-casinos and sports betting, though the subject was never directly addressed in the legislation.

Casino officials also contended the additional cost would place them at a competitive disadvantage to the state’s racetrack casinos, which the board has held aren’t required to pay any $10 million fee for sportsbooks at their off-track betting parlors or mini-casinos.

The gaming board deferred a decision on the Live! request to drop the additional licensing requirement and fee.

Board fines two casinos for violations

Separately, the board announced consent agreements for violation of regulations by two casinos.

Mohegan Sun was fined $110,000 for multiple cases of allowing underage gamblers on the casino floor, and the Meadows was fined $10,000 for employing individuals whose licenses from the board had expired.

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Gary Rotstein

Gary is a longtime journalist, having spent three decades covering gambling, state government, and other issues for the Pittsburgh Post-Gazette, in addition to stints as managing editor of the Bedford (Pa.) Gazette and as a reporter for United Press International and the Middletown (Conn.) Press.

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