DraftKings Plans Early Entrance into Illinois' Sport Betting Industry
In the bustling world of sports betting, Illinois is making waves with its unique approach to market entry. The state's gaming board has implemented a strategy that has been dubbed the "penalty box," a waiting period for national, mobile-only operators like DraftKings and FanDuel.
The penalty box was designed to last at least 18 months, and it's currently in effect. This means that while traditional casinos like Rivers Casino in Des Plaines, Grand Victoria Casino in Elgin, and Argosy Casino Alton have already started offering retail sports betting under temporary operating permits, mobile-only platforms are still waiting in the wings.
Rivers Casino, which went live with retail sports betting on March 9, 2020, is reportedly first in line to launch its online product, BetRivers. If Rivers and the Argosy receive their permanent licenses at the June 11 Illinois Gaming Board meeting, the clock would start ticking for online-only platforms, resulting in a 21-month wait before an online-only operator could launch, which would be early 2022.
FanDuel, on the other hand, is reportedly in talks to purchase Fairmount Racetrack to launch mobile sports betting as soon as it gets approval. However, neither FanDuel nor DraftKings has disclosed 80% ownership in a casino in Illinois, a requirement for mobile sports betting under Illinois law.
DraftKings, known for its partnerships with local casinos for licensing, has an agreement with Harrah's Joliet, owned by Caesars. Jumer's, owned by Delaware North, partners with IGT in West Virginia, and IGT partners with DraftKings at Mississippi's Scarlet Pearl.
Local sportsbook operators in Illinois have expressed concerns about DraftKings and FanDuel leveraging their DFS databases and gaining an advantage in the mobile market. The application fee for an owners license for sports betting in Illinois is $10 million, while the fee for an online-only license is $20 million.
It's important to note that going live with an owners license would allow an online-only operator to enter the market faster, as tethered online platforms can go live as soon as they get IGB approval. As of now, five other casinos have been granted temporary operating permits but have not yet been approved for betting.
The Casino Queen, an employee-owned business, is not among the casinos that could partner with DraftKings for a sports betting license. Illinois lawmakers mandated a 2-year wait for mobile sports betting and allowed in-person betting to go live before COVID-19 hit.
The Illinois sports betting market is shaping up to be an exciting arena, with traditional casinos leading the charge and mobile-only platforms waiting in the wings. As the situation evolves, we'll keep a close eye on developments and bring you the latest updates.
