Tennessee Grants Temporary License for Three Major Sports Betting Operators
Unleashing the Beast: Sports Betting in Tennessee
Tennessee's Sin City
The Tennessee Education Lottery (TEL) gave the green light to heavyweights like BetMGM, DraftKings, and FanDuel for sports betting on Tennessee turf, during a Special Meeting of the Sports Wagering Committee. Two more contenders, Tennessee Action 24/7 and an unnamed operator, await approval before the grand launch on November 1.
Remember the excitement at the August meeting? TEL President and CEO Rebecca Hargrove announced the ambitious target of launching sports betting on the same date. And guess what? She's still as optimistic as ever about the impending extravaganza.
Proving Their Mettle
BetMGM, DraftKings, and FanDuel were among the lucky few who managed to go live on the same day in the Colorado sports betting state. Colorado is the only other state to brave the plunge with a go-live date, and both managed to get multiple operators up and running. Other regulators, on the other hand, have preferred a more gradual approach with soft launch test periods.
The TEL spent three grueling hours grilling operators and staff alike on outstanding issues ahead of launch. They've got their fingers in many pies, from providing fingerprints to securing references from other states and authorities to understanding intricacies about reserve accounts and insurance requirements. Not to mention the advertising and marketing campaigns that need a good once-over.
The Tennessee Lottery has already received letters of good standing for BetMGM, DraftKings, and FanDuel from New Jersey and Colorado. This forms a good foundation, and they're hoping similar letters from other jurisdictions will follow.
Dive into the Nitty-Gritty
A significant chunk of Wednesday's meeting was focused on reserve accounts and insurance requirements. A lively debate ensued, as board members grappled with the stark difference between lottery requirements and the unique demands of sports betting.
Danielle Boyd, Vice President of Sports Betting, clarified the practice of granting "conditional" or "provisional" licenses as something "consistent with what other jurisdictions" have done. Any operator who manages to fulfill the requirements of a conditional license will be showered with a permanent one.
Geofencing the Competition
The Board also approved geofencing company GeoComply for a supplier's license, and multiple vendors. But hold your horses! Before an operator can set foot in the battleground, it's vital that its suppliers and vendors get their licenses first.
As for operator licenses, it's likely that Tennessee Action 24/7 and the mysterious fifth contender will cross paths with the Board at one of October's two special meetings. Tennessee Action 24/7, a local venture founded by Tennessee natives, will offer a custom mobile platform powered by Amelco and Sportradar.
The national companies have an undeniable advantage due to their rich experience with filing rigorous applications and their track records in other jurisdictions. But don't count local players out just yet—they might just manage to turn things around with their home-grown strategies.
Tennessee's Wild Ride
Tennessee laws legalized mobile sports wagering on July 1, 2019. It's the only state that's greenlit online/mobile betting and refused to budge on physical sportsbooks. Traditional gambling in Tennessee has been stranded to the state lottery and its usual products for a long time. Sports betting regulations went live after a painstaking wait of nine months and include a contentious payout cap, making operators hold a minimum of 10% of all player bets, thus, capping payouts at 90%.
This percentage keeps the state's coffers overflowing but could tempt operators to offer less lucrative odds in certain regions of Tennessee, as compared to elsewhere. Tennessee now joins a select group of three U.S. states with legal-but-not-live sports betting, along with Virginia and Washington. Virginia aims to go live in January 2021, whereas Washington is yet to propose any regulations.
Stay tuned for more updates as the Wild West of sports betting in Tennessee heats up!
- As the Tennessee Entertainment Lottery (TEL) allows BetMGM, DraftKings, and FanDuel to operate sports betting, potential payouts for wagers on sports events in Tennessee might be significant.
- During the scrutiny of operators before the launch of sports betting in Tennessee, the TEL focused on various aspects, including geofencing, advertising, marketing campaigns, and insurance requirements.
- In their bid to establish a strong presence in Tennessee's sports-betting landscape, national operators like BetMGM, DraftKings, and FanDuel bring rich experience and strong application records from other jurisdictions, while local players like Tennessee Action 24/7 may rely on home-grown strategies to compete effectively.
