D.C. Expected to Permit Sportsbooks within 4 Area Arenas, Stadiums

CapitalOneArena

Mayor Muriel Bowser is expected to sign legislation that will permit 4 Washington D.C. arena/stadium operators to open “Las Vegas style” sportsbooks on their premises; Capital One Arena (Wizards, Capitals), Nationals Park (Nationals), Audi Field (D.C. United) and the St. Elizabeth’s East Entertainment and Sports Arena (Mystics, GoGo) are the venues that will be allowed to host sportsbooks (as will new RFK when built). The bill offers the arenas/stadiums some brick and mortar exclusivity, with the District’s other licensees unable to take bets within a 2-block radius of a designated facility, but it also gives the D.C. Lottery a “virtual monopoly” on mobile business; arena/stadium sportsbook operators will only able to take mobile bets from those on the premises. The city council’s decision last week to delay a vote that would have allowed the D.C. Lottery to negotiate with a preferred vendor (as opposed to going through bidding process), likely means that sports betting legalization isn’t becoming law in Washington “until summer at the earliest.”

Howie Long-Short: D.C. is willing to allow brick and mortar sportsbooks at their sporting venues because there are no licensed casinos within the jurisdiction. Unfortunately, it doesn’t appear to be the start of a trend. As Jill Dorson, Deputy Editor, SportsHandle told me “having read proposed legislation and/or talked with lawmakers in more than 10 states that will seriously consider sports betting in 2019, putting sportsbooks into stadiums has not come up. When D.C. first proposed this, it was a unique idea and remains so. That said, I have read that there is a chance that there will be a sportsbook if not in the Raiders new stadium, on the stadium property.”

While I had Jill on the line, I asked if D.C. was also going to be unique in licensing bars, restaurants and convenience stores and tried to find out why a state would issue licenses to small private businesses like them?

Jill: While I don’t believe that any of the six states that launched sports betting in 2018 are allowing for sports betting in bars, restaurants or convenience stores, many states proposing legislation in 2019 are considering putting kiosks into bars, restaurants, hotel lobbies, and convenience stores. In both Montana and North Dakota, sports-betting kiosks in food-and-beverage venues and corner stores are definitely part of the equation; and I have talked with legislators in several other states who would prefer not to have full-fledged casinos in their states, but would rather see sports betting online with “physical” locations being kiosks in non-traditional venues, like convenience stories or restaurants. 

None of the 4 venues intend to disclose their plans (or lack thereof) until Bowser signs the bill into law, but I would bet that Capital One Arena and Nationals Park end up hosting sportsbooks; Caps/Wiz owner Ted Leonsis has long spoken about bringing sports betting to his venue and between the 2 buildings, more than 5 million fans walk through the doors annually.

Those lobbying on behalf of the arenas/stadiums are right to claim they’re being “incentivized to spend a lot of money on something that has been minimized.” The District acknowledges that 2/3 of sports betting revenue is going to come through mobile wagers and as mentioned above, the D.C. Lottery is going to keep nearly all those profits. It likely won’t make sense for all 4 prospective venues to open “Las Vegas style” brick and mortar sportsbooks without an equally viable mobile business.

League rules prevent teams/facilities from operating sportsbooks, so those that proceed are going to partner with an established gaming company. If Capital One Arena decides to move forward, the Washington Post says to keep an eye on DraftKings as a prospective partner; Leonsis’ VC firm Revolution Growth is invested in the company.

As for mobile, it remains TBD if the D.C. Lottery will go through a competitive bidding process or unilaterally award a sole source contract to Intralot (trades on The Athens Exchange under symbol INLOT), their existing provider.

Fan Marino: Speaking of the Wizards, NBC Sports Washington produced an alternative sports betting broadcast for a recent game against Milwaukee (they’ll do it 7 more times this season, next is Jan. 27 vs. San Antonio). Those watching at home saw live odds, game statistics and player statistics alongside the action and were given the chance to participate in a “Predict the Game” contest (think: prop bets) for $500 prize. Monumental SVP of Strategic Initiatives Zach Leonsis called it “the 1.0 version of where we’re ultimately going” (with regards to integrating real-time data/predictive gaming feeds into game broadcasts) and you won’t find an argument here; the future of sports broadcasting will be engagement driven.

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