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DC Council opens up the betting market to competition

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The DC Council approved its budget for FY2025 on Tuesday, 25 June. This includes provisions to allow digital sports betting. FanDuel currently is the only platform that’s available in the city, but this will soon change under the new budget.

A new budget was needed to prevent the need to submit it to Congress for approval. Voice vote was used by the DC Council to pass Budget Support Act. Budget is scheduled to take effect 15 July.

Commercial operators will be able to enter the market with this new budget. BetMGM and Caesars Sportsbook should be able quickly to increase their digital offerings. The operators already have brick and mortar sportsbooks, but they also offer digital betting in an excluded zone. They will now be able offer their platform across all of the District.

FanDuel launched in April its platform as a partnership with DC Lottery. The company has currently a monopoly. FanDuel’s Christian Genetski, the company’s president, wrote the DC Council on the 5th of June to say that the company would end its lottery agreement if the marketplace opened. In January, the lottery revealed that Intralot had subcontracted with FanDuel to handle wagering. FanDuel has replaced GamBetDC, the poorly performing platform used by the lottery.

FanDuel pays a tax of 40% for having the monopoly. Operators will now pay 20% in tax under the new plan.

Open market for operators is a huge win

Since several years, operators have pushed for an open marketplace. Kenyan McDuffie voted in 2019 against the sole-source model and wanted to see competition. Brandt Iden, Fanatics’ vice president of government affairs and Brandt McDuffie were able bring together operators to make a strong argument which McDuffie could sell.

Voting for the DC budget is a major victory for operators.

Iden said to iGB that this market had been holding together for years by a single thread and some silly glue. It was one of worst-performing markets in the nation and will now be the first market to move from a sole mobile operator to an open, competitive market. DC, thanks to Kenyan McDuffie of the council, will be a pioneer for all other closed sole-sourced markets.

Before the vote, the section on sports betting was discussed and an amendment to protect small businesses, which was 10-1 approved. This amendment will help ensure that partners of the lottery, such as convenience stores and bars, continue to offer betting kiosks.

GamBetDC kiosks were available to lottery partners in the past. FanDuel has committed to replace those kiosks with its own. Council members were concerned that the new change could cause a service gap or commercial operators to refuse to provide kiosks.

In testimony given earlier this year, several large operators stated that they were interested in offering kiosks to the market when they enter it.

First to expand will be existing platforms

BetMGM Caesars FanDuel are likely to be the first operators in DC as they already operate. DraftKings, Fanatics and other large operators have shown interest in the DC market. Both operators’ representatives testified in court earlier this year about their desire to open physical sportsbooks in Washington, DC.

Before they can go live, new operators must go through an extensive vetting procedure. BetMGM, Caesars and other operators are approved to provide online sports betting. This means that their processes to expand their platforms should be simplified. FanDuel is well-positioned to continue providing District-wide accessibility.

Before the election, DC was among six markets with a single operator. Four of the five remaining markets are either regulated or offered by state lottery companies. Florida is the fifth state, and the Seminole Tribe was granted exclusivity by the Seminole State.

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