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

Michael J. Zalewski, an Illinois House Representative, told Play Illinois that he doesn’t predict any operators spending the$ 20 million and a half on an online-only sports betting license.

Thus, 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 fixture. The key to initiating remote sportsbook registration in Illinois lies in the issuance of an online-only license.

These online-only licenses should become available for application in December.

Zalewski expressed his disbelief that anyone would bid on those licenses due to their high cost. The price difference is considerable, as a typical sports betting license in Illinois can’t exceed $10 million.

This could potentially result in a scenario where there is no foreseeable end to in-person membership.

Zalewski remains hopeful that the Sports Wagering Act can be adjusted to either reduce the cost of online-only licenses or ensure that these licenses do not necessitate remote registration.

He stated that the law was originally intended to require in-person registration to expire after 18 months. However, the law hasn’t been implemented as intended. The sole purpose of the online-only licenses was to attract companies like DraftKings and FanDuel to Illinois.

Rather than going through the “penalty box”, these companies partnered with casinos and racetracks. As a result, they are now leading the market in Illinois.

It could be assumed that a quick legislative solution would be quite straightforward, considering the original intent of the lawmakers.

If you’re comfortable with Illinois legislation, that might just be wishful thinking.

Illinois sports gambling history of in-person membership

In June 2019, JB Pritzker, the Governor of Illinois, approved the Sports Wagering Act. The act mandated in-person registration for the first 18 weeks after the initial license was granted, after which only virtual licenses might be obtainable.

Once the Illinois Gaming Board (IGB) issued the first mobile-only license, everyone would have the ability to register online.

Nevertheless, the Illinois sports betting scene was significantly influenced by the COVID-19 pandemic. The pandemic led Pritzker to halt in-person registration for over seven months, making way for remote sign-ups.

Without a doubt, the people of Illinois capitalized on this. In the months of April and May, Illinois, also known as the Land of Lincoln, ranked second in the US sports betting market by handle.

Despite Pritzker reinstating in-person registration in early April, Illinois residents still wagered $633.6 million on activities in March, setting a record for the state.

The $20 million price tag is not only high, but it’s also probable that online licenses have lost their appeal to potential users.

DraftKings and FanDuel will no longer vie for permissions as the business has now strengthened. The cost for a prospective operator to enter a relatively established market and aid more established operators would be $20 million.

Company X could potentially aid their own cause by choosing a mobile-only permit, but they might also end up benefiting casinos such as DraftKings, FanDuel, and Barstool.

All of those factors logically explain why selling mobile-only certificates is difficult.

BetMGM, Unibet, theScore Bet, Golden Nugget, and Bally’s are all preparing to break into the IL sports betting market. However, the exact dates for these sportsbooks to start operating are yet to be confirmed.

What about betting at express colleges in Illinois?

Zalewski is optimistic that the ban on in-state school betting will be removed this year.

When questioned about wagering on Illinois college teams, Zalewski responded, “I believe it gets done.”

During the most recent legislative session, a bill was passed by the House to legalize in-person betting on collegiate teams in Illinois. This was confirmed by Zalewski as a potential gradual policy step towards online wagering on Illinois college teams.

The bill, which the Senate is expected to vote on in October, easily passed in the House. However, the Senate has not yet voted on it.

Sources say that Josh Whitman, the Athletic Director of Illinois, who has been the most vocal adversary of legal in-state college betting, has somewhat softened his stance due to a recent compromise.

In April, during a public House Executive Committee hearing, Whitman stood up for his stance:

“Often, student athletes’ self-perception is largely influenced by their social media posts about individuals they’ve never encountered. This is a struggle we face daily in the current college sports environment. By permitting people in our state to bet on our students, we’re merely paving the way for them to have aggressive, intimidating, and harmful exchanges with our student athletes.”

The sports betting industry in Illinois is set for an exciting fourth quarter.