It’s all potential Illinois sportsbook operators have ever wanted. License applications for those interested in offering legal sports betting in Illinois will make for a great Christmas present this year.
The applications should be available by Dec. 19. This is the first semblance of a timeline for the actual rollout of legal sports betting in Illinois, which is still very early in the process.
What the license applications do — and don’t — mean
For the first time, Illinoisans will get a look at what the Illinois Gaming Board has been up to since the enactment of a gambling expansion law in June. The applications should list out all the requirements the IGB expects applicants to meet along with the required fees.
A lot is uncertain going forward from there, however. An answer to the question most on Illinois residents’ and visitors’ minds remains elusive. It’s still a mystery as to when legal sportsbooks will actually start accepting wagers in the state.
The IGB has yet to specify how long it will take to process the applications or what the approval process will entail. It’s also uncertain whether turnkey applicants, operators who already have sports betting products live in other states, would get preference over new operators.
Interest among such operators is in question as well. That’s due to perceived flaws in the Illinois law.
Where Illinois may have gone horribly wrong
The law provides for three “stand-alone” mobile operators. That means they would accept all their wagers on the internet and offer no in-person wagers.
These online operators wouldn’t be eligible to accept wagers until a year and a half after the rest of the crowd, though. The state also demands a hefty $20 million fee for each of those three licenses.
That cost along with the excessive wait could create hesitation on the part of online sportsbooks like DraftKings and FanDuel. There is another option for brands like that, however.
They could gain immediate entry into the Land of Lincoln by partnering with a physical facility. That could be a casino, racetrack or one of seven sporting event venues.
Neither option seems ideal for an operator like PointsBet. Either they split revenues with a partner or hope to land one of three stand-alone licenses at an exorbitant cost with a long wait to collect revenue.
There’s another reason potential operators may not be furiously filling the applications out the day they become available. That has to do with customer convenience which of course affects handle and revenue.
Illinois has a chance to learn from two of its neighbors
Just across the Mississippi River from Illinois is a state that rolled out legal sports betting in the middle of August. Largely due to a particular provision that mirrors the Illinois law, sports betting revenues have underwhelmed thus far in Iowa.
The Hawkeye State requires online bettors to register for their accounts in person. This has led to stagnant growth of sports betting in Iowa while others enjoy large gains.
Illinois’ neighbor to the east, Indiana, took a different approach. Mobile bettors in the Hoosier State can conduct the entire wagering process from registration to collecting winnings entirely online.
Partially because of that, handle in Indiana nearly doubled from September to October of this year. Seeing the disappointing level of buy-in in states like Iowa could create further hesitation among potential applicants regarding Illinois.
Being so early in the process, there’s still time for Illinois to make revisions based on similar markets. Whether the state’s government will take advantage of the available information and adjust accordingly remains to be seen, however.
Regardless, the opportunity to apply for a legal sportsbook license in Illinois will soon arise. From a historical perspective, that is significant.