Zalewski: $20 Million Mobile-Only Sports Betting License Will Be A Tough Sell

Illinois House Representative Michael J. Zalewski told Play Illinois that he does not foresee any operators investing the full $20.5 million for an online-only sports betting license.

If none of the gaming companies bid on one of the three mobile licenses, and there is no legislative solution, in-person sports betting registration will become a permanent requirement. The key to implementing remote sportsbook registration in Illinois hinges on the issuance of an online-only license.

These licenses that are only available online will be open for application in December.

Zalewski was incredulous that anyone would be willing to bid on those licenses given their exorbitant cost. The price discrepancy is significant, as a standard sports betting license in Illinois is capped at $10 million.

This could potentially lead to a situation where in-person membership has no clear endpoint in sight.

Zalewski is optimistic that changes can be made to the Sports Wagering Act, such as lowering the price of online-only licenses or eliminating the requirement for remote registration.

He claimed that the original intention of the law was for in-person registration to end after 18 months, but it has not been enforced as planned. The primary reason for the introduction of online-only licenses was to entice companies such as DraftKings and FanDuel to operate in Illinois.

Instead of facing penalties, these companies chose to collaborate with casinos and racetracks, ultimately emerging as market leaders in Illinois.

Given the lawmakers’ original intent, a swift legislative solution should be relatively simple.

It may be wishful thinking to assume you are comfortable with Illinois legislation.

Illinois sports gambling history of in-person membership

The Sports Wagering Act, approved by Governor JB Pritzker of Illinois in June 2019, required in-person registration for the first 18 weeks following the initial license issuance. After this period, only virtual licenses would be available for obtaining.

After the Illinois Gaming Board (IGB) issued the first mobile-only license, online registration would be available to all.

However, the Illinois sports betting landscape was greatly impacted by the COVID-19 pandemic. Due to the pandemic, Pritzker suspended in-person registration for more than seven months, allowing for remote sign-ups instead.

The residents of Illinois definitely took advantage of this opportunity. During the months of April and May, Illinois, also known as the Land of Lincoln, came in second in the US sports betting market by handle.

Even though Pritzker allowed in-person registration to resume in early April, Illinois residents managed to set a state record by wagering $633.6 million on activities in March.

Not only is the $20 million price tag steep, but it’s also likely that online licenses have lost their appeal to potential users.

DraftKings and FanDuel have decided to stop competing for licenses due to their increased business strength. The cost for a new operator to enter the market and support existing operators is $20 million.

Company X has the option to support their own interests by selecting a mobile-only permit, although this decision could also result in advantages for casinos like DraftKings, FanDuel, and Barstool.

All of these factors logically contribute to the challenges of selling mobile-only certificates.

BetMGM, Unibet, theScore Bet, Golden Nugget, and Bally’s are all gearing up to enter the Illinois sports betting market. The specific launch dates for these sportsbooks have not been officially announced.

What about betting at express colleges in Illinois?

Zalewski is hopeful that the prohibition on in-state school betting will be lifted this year.

When asked about betting on Illinois college teams, Zalewski replied, “I think it happens.”

In the latest legislative session, the House approved a bill to legalize in-person betting on collegiate teams in Illinois. Zalewski indicated that this could be a first step in gradually allowing online wagering on Illinois college teams.

The bill, which easily passed in the House, is expected to be voted on by the Senate in October.

According to sources, Josh Whitman, the Athletic Director of Illinois, who has been a strong opponent of legal in-state college betting, has slightly eased his stance following a recent compromise.

During a public House Executive Committee hearing in April, Whitman defended his position.

Frequently, student athletes’ self-image is heavily shaped by their social media interactions with strangers. This is a common challenge we deal with in today’s college sports landscape. Allowing people to gamble on our students in our state only opens the door for potentially harmful and intimidating interactions with our athletes.

The sports betting scene in Illinois is gearing up for an exhilarating fourth quarter.