SugarHouse ushered in a brave new era for Pennsylvania’s nascent sports betting industry when it launched the state’s first online sportsbook on May 31. That followed three days of testing in which the operator accepted wagers while fine-tuning its digital offering. The Keystone State has now published its sports betting revenue report for May and it shows that the SugarHouse site took a handle of $573,163 in just three-and-a-half days at the end of the month. Three of those were test days, and the strong performance indicates that the handle will soar across Pennsylvania once online sports wagering is rolled out.
Until now bettors in the state have been forced to travel to one of eight brick and mortar sportsbooks if they want to bet in a safe and legal environment. Six are located in and around Philadelphia, one is in Pittsburgh and the other is near Harrisburg, meaning that some sports fans would have to drive for more than 100 miles to reach their nearest venue. But anyone in Pennsylvania can now access the SugarHouse app on their smartphones and bet until their hearts are content from the comfort of their living rooms. That opens up a much greater market for the state’s operators.
All Change for SugarHouse
Chicago-based firm Rush Street Gaming owns SugarHouse and it is planning to rebrand it as Rivers Casino Philadelphia. It already operates Rivers in Pittsburgh, so named as it sits at the confluence of the Allegheny, Monongahela and Ohio rivers. It has since opened two more Rivers casinos – one in Des Plaines, Illinois, which is near Chicago, and the other in Schenectady, New York. It feels that rebranding SugarHouse will “enable regional and national marketing to promote one Rivers Casino brand across multiple markets and channels.”
“Since receiving our casino license in 2006, gaming in Pennsylvania has evolved tremendously,” said Greg Carlin, chief executive at Rush Street Gaming. “Keeping pace with the changing landscape has been paramount to our success. Creating a unified brand is another example of how we’re anticipating and responding to the competitive market for gaming.” SugarHouse also has an online presence in New Jersey and that site is likely to be rebranded too.
Pennsylvania’s Big Three
Rivers Pittsburgh’s retail sportsbook has emerged as the most popular in the state during the early months of the industry. In May, it took a sports betting handle of $7.9 million, while SugarHouse was second at $7.4 million, followed by Parx Casino, which took $6.8 million. They are very much the big three in the state, as the others have seen far smaller figures so far. Rivers held revenue of $641,029 in May, whereas SugarHouse’s revenue stood at a healthier $711,845 and Parx kept back $639,992, suggesting Pittsburgh punters are currently savvier than their Philly counterparts.
Rush Street Gaming expects to launch a Rivers Casino app this month, and this could see the SugarHouse site disbanded as the brand will soon be consigned to the history books. Parx is also preparing to launch an online sportsbook this month after appointing Kambi as its white-label provider. FanDuel is also planning to launch on the licence of Valley Forge Casino, while Harrah’s Philadelphia and Hollywood Casino at Penn National should enter the online arena this summer. All of this activity should see Pennsylvania’s sports betting handle shoot up, as it currently trails neighbouring New Jersey – a state with a slightly smaller population – by a significant margin.
New Jersey, which has been offering online sports betting for several months, recorded a handle of $318.9 million in May. That was up slightly on the previous month, and it dwarfed the $35.4 million that Pennsylvania’s sportsbooks took last month. The vast majority of the Garden State’s sports bets are placed online, where FanDuel and DraftKings are on fire. Despite the low handle and revenue of just $2.9 million, Pennsylvania took more than $1 million in tax during May, as it charges an eye-watering 36% tax rate on sportsbooks.
New England Heating Up
Elsewhere, lawmakers in Maine approved a sports wagering legalization bill this week. LD53 motored its way through the legislature on Tuesday and gained approval from both chambers on Wednesday. It has now been sent to Gov. Janet Mills’ desk for her to sign it into law. It makes Maine the eighth state to give sports betting the green light in 2019, following in the footsteps of Montana, Iowa, Indiana, Tennessee, Colorado, Illinois and its western neighbour, New Hampshire. Last year, Delaware, New Jersey, Mississippi, West Virginia, Rhode Island and Pennsylvania all launched legal sports betting industries, while a tribal casino in New Mexico began accepting sports wagers.
The legal sports betting trade is now spreading like wildfire across the country. New Jersey has gained the most attention, as it has taken a handle of more than $3 billion since it allowed sportsbooks to operate legally, but several other states are enjoying strong revenues. Maine is bidding to become one of the industry leaders, and its bill looks like one of the best around.
It is the first state to allow unrestricted, untethered third-party access. This means online operators are not forced to partner with a brick and mortar venue in the state. In New Jersey, for example, FanDuel has to operate on the Meadowlands licence, while DraftKings has teamed up with Atlantic City casino Resorts. Maine will simply be an open market, just like the one seen in mature sports betting markets such as the UK. Maine lawmakers believe this will allow the state’s new industry to develop at a faster rate.
Land-based operators have been given one concession though, as they only have to pay a 10% tax on revenue, whereas online operators – who are not burdened by rents – have to pay 16% of their winnings. The licencing fee stands at just $20,000, which is tiny compared to the $10 million that Pennsylvania charges. Maine is the 42nd most populous state and it is unlikely to rival the likes of New Jersey, Nevada and Pennsylvania in terms of handle, but it could punch above its weight due to liberal legislation. It could also influence developments in Connecticut, Massachusetts and Vermont, as the other three states in New England have now approved sports betting.