Handicapping Which Sportsbooks Will Come Next To Illinois

Predicting which sportsbooks will be the next to arrive in Illinois can be a somewhat challenging task.

Ultimately, there are compelling reasons why the number of sportsbook operators in Illinois has plateaued at seven, while other regions offer significantly more options.

Nonetheless, Illinois presents significant opportunities for potential operators. Among its attractions is a sports-literate population of approximately 12.5 million, positioning the Prairie State as the second largest market in the US for sportsbook revenue. In addition, it is the third largest in terms of handle.

There are at least 14 available slots for new IL sportsbooks, many of which are connected to retail Illinois casinos. Therefore, the opportunities to enter the market are quite extensive.

Our odds for which Illinois sportsbook operators are coming next

Which sportsbooks have the highest probability of coming to Illinois? According to Play Illinois, the odds are currently as follows:

1. Around 2-1, the Nevada brand has already secured a deal with Full House’s American Place Casino in Waukegan. A temporary casino is slated to open in December. This is when Circa is anticipated to become the eighth live sportsbook operator in Illinois, subject to approval from the Illinois Gaming Board.
2. Bally Bet is at 3-1. Bally’s has two clear opportunities to connect its online sportsbook to one of its physical casino locations: either the existing Bally’s Quad City Casino and Hotel in Rock Island or the Bally’s Chicago mega-casino. In September, Bally’s sought a sportsbook license from the IGB, indicating a clear interest and intention.
3. European gaming titan, bet365, stands at 5-1 odds. The company’s large scale gives it a fighting chance to acquire sufficient market share in Illinois to offset the cost of entry. Currently, bet365 is one of the top successful operators in the highly competitive regulated market of Ontario, housing 39 operators and still counting. In addition to this, bet365 also has operations in New York, New Jersey, and Colorado.
4. In November 2021, WynnBet, currently operating in nine US states, sought a Management Services Provider license from the IGB. This license is necessary for offering mobile wagering in the state. Despite this, there has been limited recent news regarding WynnBet’s expansion plans in Illinois.
5. Initially believed to be in partnership with Argosy Casino in Alton, recent news about Unibet’s entry into Illinois has been scarce. However, the European heavyweight has shown its serious intent by applying for a license with the IGB. Current operations of Unibet are in Ontario, New Jersey, Pennsylvania, Virginia, Iowa, and Indiana.

Other sportsbooks possibly eying Illinois

Potential additional operators that could enter Illinois include:

• Hard Rock, with odds of 8-1, has not made a significant announcement about launching its own online sportsbook in Illinois. However, they have submitted an application to the IGB to operate one. The company has a temporary retail casino in Rockford that currently doesn’t have a sportsbook partner. Hence, introducing an online sportsbook seems like a logical next step. Hard Rock already runs online sportsbooks in six other states.
• Fanatics CEO, Michael Rubin, revealed at the CAA World Congress of Sports in New York that the leading sports merchandiser intends to launch sports betting in all major US states, with the exception of New York, by January 2023. This implies that Illinois must be included to achieve these ambitious plans. However, no official announcement has been made regarding Fanatics’ plans to enter the Prairie State.
• Golden Nugget has odds of 10-1. Although it’s still unclear whether Golden Nugget aims to establish an online sportsbook in Illinois, they are planning to open a retail casino in Danville. Thus, it would be logical for them to enter the market through this venue. Golden Nugget currently runs an online sportsbook in New Jersey, Michigan, Virginia, and West Virginia.
• Pinnacle is currently standing at 12-1. The operator, known for its black-market operations, has now turned legitimate in Ontario, but hasn’t extended this legitimacy to any other part of North America. It’s uncertain whether their operations in Ontario are a sign of a possible venture into Illinois. However, the operator’s popularity among certain betting enthusiasts may give them an opportunity to secure a substantial market share in Illinois if they choose to expand there. Many bettors prefer Pinnacle because it often provides better odds rather than bonuses, credits, and incentives. Pinnacle also promotes itself as a platform that celebrates winners and does not ban users who cash out frequently.

Longshots to come to the Prairie State

These operators are unlikely to come to Illinois:

• Betr, a sportsbook offering micro-betting, has odds of 15-1. Known as the world’s first micro-betting sportsbook, Betr’s unique selling proposition may enable it to enter the Illinois market. Unlike traditional betting, Betr allows bets on individual moments in a game that are not related to the final score, such as balls and strikes in a baseball game. Although there has been no indication that the sportsbook, backed by Joey Levy and Jake Paul, is considering Illinois, Betr revealed last week that it has found a way into the Indiana market. Previously, it stated its intention to launch in Ohio when the state’s market opens on January 1, 2023. Therefore, Illinois could be a potential market for Betr.
• Prophet Exchange, a New Jersey-based betting exchange, is similar to Betr in offering a unique selling point. Unlike traditional betting setups, a betting exchange provides a platform for bettors to place wagers against each other, typically at lower fees. Although Prophet Exchange has not expressed an interest in expanding to Illinois, it would be a missed opportunity not to consider the Prairie State, much like its 25-1 offering.
• Fox Bet, with odds of 25-1, has not made any serious indications of considering Illinois. However, since it currently operates in Colorado, Michigan, New Jersey, and Pennsylvania, it wouldn’t be unreasonable to think that Illinois could be a potential market.
• Penn National owns theScore Bet and has retail casinos in Joliet and Aurora. Although theScore Bet was once associated with the Joliet facility, Penn has decided to stick with Barstool Sports as its sportsbook brand in the US. However, theScore Bet will continue its operations in Canada and is set to provide Barstool with proprietary trading technology in 2023. Therefore, it’s highly improbable that theScore Bet will establish itself as a brand in Illinois. But, as they say, never say never.

Numerous entry points still exist for the Illinois sports betting market.

Seven existing Illinois sportsbooks and how they got there

Only five out of the 11 operating retail casinos in Illinois have licensed online sportsbook partners.

• BetRivers has entered into a partnership with Rivers Casino in Des Plaines.
• With DraftKings at the Casino Queen in East St. Louis.
• Caesars with Grand Victoria Casino in Elgin
• Barstool with Hollywood Casino Aurora
• BetMGM online and FanDuel retail are associated with the Par-a-Dice Hotel Casino in East Peoria.

Additionally, the two functioning horse racetracks in the state — Hawthorne and the erstwhile Fairmount Park — are permitted to establish online sportsbook partnerships, unlike licensed OSBs. Fairmount has teamed up with FanDuel, leading to the renaming of the track to FanDuel Sportsbook and Horse Racing. Hawthorne, on the other hand, has collaborated with PointsBet.

That’s how we ended up with seven sports betting operators in Illinois.

At least 14 Illinois sportsbook slots remain open

This means there are at least 14 open slots available for an Illinois online sportsbook to enter the market, and potentially even more.

• Six connected to an existing licensed retail casino through a tether
• Five connected with new casino applicants
• Three through online-only sportsbook licenses
• There could potentially be four places linked to professional sports facilities where betting can take place. The Fanduel Sports Lounge at the United Center is already operational but is awaiting approval to start accepting bets. Meanwhile, a DraftKings Sportsbook is being built at Wrigley Field and is projected to open in 2023.

Six open slots are available for an Illinois online sportsbook to join the market through a tether with the following licensed retail casinos:

• Harrah’s Casino Joliet
• It was initially believed that Hollywood Casino Joliet was partnering with theScore Bet, however, theScore Bet has since exited the US market.
• It was originally believed that Argosy Casino Alton was connected to Unibet.
• Harrah’s Metropolis Casino
• The Hard Rock Rockford Casino is currently operating from a temporary site while construction on a permanent location has commenced.
• Quad City Casino and Hotel by Bally’s in Rock Island

There are also five more open slots available for a sportsbook operator to partner with new applicants for a casino in Illinois.

• Circa already has a deal with American Place Casino in Waukegan.
• Bally’s Chicago, where a major casino is planned to be constructed in the Chicago Tribune printing plant, is anticipated to serve as the anchor for a Bally’s sportsbook. Bally’s may also connect its online sportsbook with its Rock Island casino.
• Golden Nugget Danville
• Casino at Walker’s Bluff in Williamson County
• Homewood’s Wind Creek Chicago Southland

Online-only license slots re-opened

Then, there are three online-only sportsbook licenses available which are not tied to a retail casino. However, each of these licenses costs $20 million.

Clearly, the cost has been a barrier to entry. At present, there are no applicants for an online-only license. As of Nov. 1, the Illinois Gaming Board has reopened the slots for bidding. The deadline for bid submissions is March 1, 2023.

In August 2021, when the IGB first introduced online-only licenses, only four operators, who were relatively weak, applied.

The Malta-based sportsbook operator Tipico was rejected by the IGB for not meeting the December 2021 deadline.

Digital Gaming, a Florida company, withdrew its application after filing.

Fubo Gaming attempted, but was informed by the IGB that it “did not satisfy the minimum requirements and was therefore disqualified.” This was likely for the best, as Fubo Gaming revealed on October 17 that it was shutting down its operations.

Tekkorp, an investment group linked to Caliente, one of Mexico’s top gaming companies, was the only applicant that almost succeeded. However, in October, Tekkorp declared that it was no longer seeking a sportsbook license in Illinois.

Why operators are reluctant to enter Illinois

Despite Illinois offering numerous opportunities for sportsbooks to penetrate the market, there are also many significant deterrents.

The license cost ranks at or near the top of the list.

The original retail casino license holders had to pay 5% of adjusted gross receipts to include a sportsbook. For the two horse racing tracks, it was a percentage of handle. The actual cost varied between approximately $2.3 million and $10 million.

Regardless of whether it’s a new casino or track, the base is a percentage, but the minimum charge is $5 million.

Operating a sportsbook at a professional sports facility requires a license costing $10 million. However, the rights to manage an online sportsbook are restricted to the immediate blocks surrounding that facility, limiting their value largely to marketing exposure.

As previously stated, the price for a license for an online-only sportsbook is $20 million.

Considering the significant competitors already in the market, asking for a minimum entry fee of $5 million is quite substantial, particularly given the slim profit margins in sports betting. It would be challenging for a new operator in Illinois to gain a significant market share to make this work, especially when competing against established players like FanDuel, DraftKings, BetMGM, PointsBet, BetRivers, Caesars, and Barstool.

Additionally, current market participants are not eager for increased competition and are probably financing lobbying efforts to maintain the number of sportsbook operators in Illinois at, or close to, its current level.

No online casinos a further disincentive

Then there’s the major problem: Illinois currently prohibits the real profit generators: online casinos.

This probably accounts for why regions that provide online casinos—most notably New Jersey, Pennsylvania, Michigan, and Ontario—have a higher number of operators than Illinois. To be specific, Ontario leads with 39 operators, followed by New Jersey with 33, Michigan with 15, and Pennsylvania with 14.

The Wagering in Illinois 2021 update by The Illinois Commission on Government Forecasting and Accountability estimated that online casinos would have been beneficial during the COVID-19 pandemic when retail casinos were closed.

Based on the revenue results from states with online casinos, it is possible that adjusted gross revenue (taxable base) totals could have ranged from $622 million to $1.249 billion.

Tax revenues could have fluctuated between $75 million and $200 million during this particular pandemic period, given the directed rates of 12% to 16%. It’s important to note, though, that revenues generated in a pandemic are typically higher, as more gaming/spending options would likely become available once concerns about the virus diminish.

Thus, it’s evident that Illinois perceives online casinos as a significant source of revenue.

In Illinois, video gaming terminals are king

Remember, Illinois boasts the most profitable video gaming terminal market in the whole country, and possibly the world. Around 8,200 locations in Illinois host approximately 44,000 VGT units. The revenue generated from these units significantly surpasses that from Illinois’ casinos.

Steve Brubaker, an Illinois lobbyist, told Play Illinois:

The VGT guys are the primary contributors to the revenue of Illinois. The income they generate is almost double that of any other source. Consequently, an online casino product would present direct competition to bars and restaurants. This would result in resistance not only from the VGT companies but also from local bars, restaurants, and mayors whom the legislators rely on for their re-election.

“So, the issue at hand needs to be figured out. What incentives can we provide to Video Gaming Terminal (VGT) operators to make them back online casinos? Even more crucially, what can we offer to mayors, bar owners, and restaurant owners in those legislative districts to secure their support?”

This implies that the establishment of online casinos in Illinois is improbable in the near future, making the likelihood of adding more online operators who only run sportsbooks even lower.

If the rules remain the same, only an extremely large operator with deep pockets would want to come to Illinois.