Industry divided over temporary sport betting licenses in Massachusetts
Companies interested in vying for a mobile-only sports betting license in Massachusetts are divided over the idea of a temporary license structure that could mean the universe of betting platforms would start in the dozens and then be scaled back to just seven outlets. There is also concern over whether licensed companies should be allowed to open when they are ready or all on a prescribed date.
One by one, lawyers and executives representing some of the, at least 30, companies that have expressed an interest in one of the seven mobile-only sports betting licenses allowed under the state's new wagering law, shared their thoughts with the Gaming Commission as the regulators attempt to get their arms around the sports betting industry and the complexities of the new law.
Because the Legislature capped the the number of final untethered mobile licenses at seven but also included a temporary license process that does not limit the number of temporary licenses, the commission is concerned about the potential that dozens of operators would qualify for temporary licenses that could last up to a year, begin taking bets in Massachusetts, and then have to shut down once the seven final mobile-only licensees are chosen.
The Legislature, which rushed through its sports betting legalization bill during an all-night session on July 31, has publicly shown no interest in stepping in to give the commission more specific directions.
The commission asked that mobile betting companies that submitted a non-binding notice of intent to apply for a license share their thoughts on the temporary license issue and the question of a staggered versus simultaneous launch of betting.
There was no consensus among the operators that showed up in the State House's Gardner Auditorium. DraftKings and Betr, for example, said they thought temporary license structures worked fine in other states but Bally's, Hard Rock Digital and BetFred told commissioners they would not recommend using the temporary license process. Most of the companies that shared their thoughts said they preferred having the commission set a common start date for mobile betting so no one operator gets a jump on the others.
"A successful launch of sports wagering requires a significant investment of time and resources by the operator to make sure that they are creating a customized product for the specific state where they're launching, as well as by the commission to make sure that the product that's being launched is appropriate and meets the regulatory guidelines for that state," said Cory Fox, FanDuel's vice president of product and new market compliance. " We don't think it's an effective use of resources by operators or by the commonwealth to offer more temporary licenses than there can be final licenses, given the significant investments by both the operator and the commission."
Fox said the company views the ability for the commission to issue temporary licenses as a way to expedite the launch of the operators have already been selected through a competitive process.
"The temporary licenses allow the commission to launch sports wagering while the commission is finalizing its suitability review of the operator in preparation for issuing a full license," Fox said.