New York blows past $1.6 billion in mobile sports bets in first month
New Yorkers placed a record-breaking $1.6 billion worth of online sports bets in January, shattering a previous U.S. all-time tally set by Arizona for the highest opening sports betting handle. Figures released Friday show that New York also surpassed the one-month record set last year by neighboring New Jersey.
The $1.6 billion figure, from the state's gaming commission, includes wagers placed by New Yorkers on some of the nation's most popular sports betting platforms like FanDuel, BetMGM and DraftKings.
Arizona set the previous record last fall after the state reported a combined $777 million handle in September and October, the Arizona Republic reported. New Jersey set the one-month handle record at $1.3 billion in October. Now, there's a new record-holder.
"Some states have taken months, even years, to get up to a running pace and New York seems to have hit the ground at full gallop," Eric Ramsey, market analyst lead for sports wagering data company PlayUSA Network, told CBS MoneyWatch. "There's not a question: New York is already the largest sports betting state in the country."
A "handle" refers to the total amount of money wagered by bettors in a given period. In-person sports betting has been legal in New York since 2013, but the state OK'd the mobile app version last April. The state's approval took effect Jan. 8 and the amount of wagers has exploded weekly ever since.
Ramsey said New Yorkers have far exceeded what he and other analysts expected for the state's first few weeks of app-based gambling. Also noteworthy about New York's handle: It happened even before the Super Bowl or March Madness, which are two of the largest betting events of the year, Ramsey said. State gaming officials said in a statement that they're pleased with the handle and it shows that there's strong interest in online sports betting in the Empire State.
Ramsey predicted earlier this week that New York would surely break New Jersey's record, saying "I wouldn't be surprised to see something closer to $1.5 or $1.6 billion."
Poised for growth
New York started its online sports betting scene with just four platforms — Caesars Sportsbook, DraftKings, FanDuel and Rush Street Interactive. Another five platforms — Bally Bet, BetMGM, Wynn Interactive, PointsBet and Resort World Bet — have now received state approval to take wagers. Across all those platforms, New Yorkers have created more than 1.2 million sports betting accounts, according to GeoComply Solutions.
Part of why New York's handle is so high is because it includes incentives of "free money" the betting platforms are offering customers just to start gambling, Ramsey said. Caesars Sportsbook, for example, is offering a whopping $3,000 bonus to join, Ramsey said. Caesars and the others are doing this so they can grab as many customers as possible, quickly, in an effort to become the sports gambling leader in one of the nation's largest states, Ramsey said.
BetMGM, FanDuel and DraftKings "are in a frenzy for customer acquisition and are spending enormous amounts on advertising and sponsorships," the consulting firm Deloitte wrote in a 2022 research note. Those companies, and others, are jockeying for customers because they expect more states to legalize online sports betting in coming months.
The New York handle will likely grow even larger in coming weeks and that's one of the reasons PointsBet wanted to offer its platform there, said Chief Marketing Officer Kyle Christensen.
"We were confident that New York state would offer a huge opportunity to reach an active and engaged segment of bettors," Christensen said in a statement. "We saw the patterns and we knew the appetite was there. The numbers have been exciting to watch."
"Numbers we've never seen"
Sports gambling has been a lucrative industry even before it was legalized and experts predict it's not done growing. Legal sports betting generated $1.5 billion in revenue in 2020 and it's slated to reach $5.8 billion by next year, according to a report by Eilers & Krejcik Gaming.
Some of that growth may come from the new gambling facilities that FanDuel, BetMGM and others plan to open in sports arenas across the country. BetMGM opened a sportsbook at Nationals Park in Washington, D.C., and FanDuel said it plans to open one at United Center, home of the Chicago Bulls. In New York, lawmakers might allow gambling companies to open new facilities at Madison Square Garden and Yankee Stadium.
States began legalizing online sports betting three years ago after a U.S. Supreme Court ruling from 2018 struck down a federal law barring gambling on football, basketball, baseball and other sports. States where sports betting is legal have reported millions of dollars in added tax revenue, according to gaming association data. As of February, 18 states have legalized online sports betting.
The number of placed bets will likely plummet in New York during the spring and summer because there's only baseball to bet on, Ramsey said. But once the fall arrives and football season gears up, New York's online sports gambling will probably show "numbers that we have never even thought of seeing in the U.S. before," he said.