The landscape of sports betting in Washington, DC, is undergoing a significant transformation as two major platforms, BetMGM and Caesars Sportsbook, prepare to extend their reach across the city. This expansion was set to begin on Monday, 15 July, but is now facing delays due to a delay in the mayor's approval of a critical budget bill.
Mayor Muriel Bowser has yet to sign the necessary budget bill, stalling plans for BetMGM and Caesars Sportsbook. The delay led BetMGM to cancel its planned celebration at Nationals Park, highlighting the uncertainty that currently engulfs the DC sports betting scene.
Transition and Market Evolution
FanDuel remains the sole player standing firm in the Washington, DC sports betting market. In partnership with the DC Lottery, FanDuel's platform continues to be the only available option for sports betting enthusiasts in the nation's capital. This dominance is set against the backdrop of significant regulatory changes and market shifts.
The DC Council gave final approval to the FY 2025 budget on 25 June, with an effective date slated for 15 July. The ongoing delay in the budget bill's approval has put a wrench in the plans of BetMGM and Caesars Sportsbook, both of which hold Class A licenses allowing them to offer digital platforms within a two-block exclusion zone around their respective venues, Nationals Park and Capital One Arena.
From GamBetDC to FanDuel
The evolution of the sports betting market in DC is marked by notable milestones and setbacks. Originally, in January 2019, the DC Council had approved a single-provider digital market without a competitive bid process, expanding the contract of lottery vendor Intralot to include sports wagering. Intralot’s GamBetDC platform, however, faced criticism for its limited betting markets and technical issues, ultimately falling short of its revenue promises.
In stark contrast, FanDuel’s entry into the market has been remarkable. Following a new contract with the DC Lottery, FanDuel's online sports betting operation saw a 450% increase in handle during its initial month compared to the same period under GamBetDC. May 2023 figures display this success, with FanDuel generating $4.9 million in revenue compared to GamBetDC’s $711,282. Recognizing these gains, the city takes 40% of the revenue from its lottery-backed wagering partners, highlighting the importance of efficient and effective platforms in driving financial returns.
New Licensing Dynamics
The introduction of new legislation brings about the inception of Type C licenses. These licenses, valid for five years, come with a price tag of $2 million and an annual renewal fee of $1 million, coupled with a 30% tax rate. These licenses broaden the scope for operators, allowing partnerships with franchises in addition to venues.
FanDuel’s strategic partnership with Audi Field exemplifies this new dynamic. By aligning with Audi Field, FanDuel benefits from a reduced tax rate of 20%. This innovative approach clearly delineates the evolving strategies within the sports betting market and the regulatory landscape in DC.
The Role of Class A Licenses
The Class A licenses held by BetMGM and Caesars Sportsbook enable them to exploit digital platforms within specific zones around their venues. Notably, Caesars has maintained a consistent presence since opening its sportsbook at Capital One Arena in July 2020, with BetMGM launching its operations at Nationals Park in June 2021. FanDuel, not to be left behind, established a retail presence at Audi Field in July 2022.
While FanDuel currently enjoys a lone-standing advantage, the potential entry of BetMGM and Caesars Sportsbook is poised to intensify competition and diversify options for bettors in DC, pending the resolution of the budget bill standoff.
The city's sports betting scene awaits Mayor Bowser's nod on the budget bill, a step crucial for renewing licenses and allowing the planned expansions. This moment marks a pivotal juncture for Washington, DC, as it navigates the complexities of sports betting legislation and market demands.