Legal sports betting in Illinois continues to be big business, but there may be a limit on the market’s potential.
According to Illinois Gaming Board data (igb.illinois.gov), in July profits from sports betting topped $2 billion since it became legal in March 2020. Setting aside Nevada, long the only state outside a federal ban, only New York and New Jersey have cross that threshold.
Also in July, the board announced Betway, headquartered in Malta, was the only qualified bidder for one of Illinois’ three licenses for online only sports betting. But at Thursday’s board meeting, IGB Administrator Marcus Fruchter said the company withdrew its application, so “the supplemental competitive selection process for an online only master sports wagering license under Section 25-45 of the Sports Wagering Act concluded without the issuance of any licenses.”
Running any sort of gambling outfit is considerably more complex than operating a neighborhood tavern, but if a town offers three new liquor licenses without finding a single taker, that might indicate something about the local economy.
In Illinois, the action happens online. In August alone, and just counting pro sports, the in-person handle was $19.4 million, while internet and mobile device wagers totaled more than $637 million. Stretching back to the beginning, those figures are about $805 million in person and more than $20.8 billion online. That’s more than 96% online, a split that tracks along the other monitored categories (college sports, motor races and “other”).
This isn’t the first time Betway has been in and out of Illinois, as it withdrew from the original 2021 process for online-only licenses. But why is a worldwide leader with a presence in seven other states cold on what otherwise seems to be a hot market?
Fruchter didn’t expound on the withdrawal at the meeting, according to various reports, which leaves speculation about the licensing process itself, and specifically the $20 million upfront fee for online bookmakers that aren’t legally tethered to a physical casino.
Governments reap millions of dollars each month in betting taxes. The casinos themselves seem to be doing pretty well. Sports betting was always popular in Illinois (and seemingly everywhere else), but bringing it above board has appeared to be a win for everyone, except the people who bet more than they can afford to lose. Those folks weren’t in any better position before 2020, and in theory the heavy hands of state and federal regulators can influence how many people get hurt in order to bolster private and public coffers.
If lawmakers want to continue goosing the market, they seemingly must consider their entry barrier. Obviously there’s money to be made in Illinois, but these companies don’t amass billions by making risky wagers.
• Scott T. Holland writes about state government issues for Shaw Media. Follow him on Twitter @sth749. He can be reached at sholland@shawmedia.com.
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