What The Penn National Deal Means For Illinois Sports Betting

Posted on August 13, 2019

There are still a lot of unknowns about Illinois sports betting. Visitors to and residents of the Land of Lincoln got a piece of the puzzle with the announcement of a new Penn National Gaming deal, however.

The news identifies which parties will definitely be part of sports betting in Illinois upon launch. It also complicates the path for other interested players.

Penn National deal paves the way for a star

Penn National Gaming, which operates the Hollywood casinos in Aurora and Joliet, has struck a market access and sportsbook operation deal with five companies. The result is some relevant news for future bettors in Illinois.

The five companies are DraftKings, Kambi, PointsBet, theScore and The Stars Group. Kambi will provide operational infrastructure like software for all the Hollywood-branded (or other Penn-branded) sportsbooks.

The other four companies will partner with Penn to operate the land-based and mobile sportsbooks in places where Penn has a casino presence. Besides Kambi, the biggest winner in Illinois is the Stars Group.

Why the deal is relevant for the Stars Group in Illinois

The Stars Group is already the world’s largest online gambling company. It has already partnered with Fox Sports to produce the Fox Bet platform, which will now likely be available for Illinois residents and visitors at some point.

The deal with Penn gives the Stars Group first priority for an online skin in Illinois. The contract runs for the next two decades.

The Stars Group had to pony up $12.5 million in cash plus agree to a revenue share to get in on this deal. With that investment on the line, it’s certain the Stars Group will be active in Illinois.

The Stars Group is the only operator that secured a foothold in Illinois through this deal. That doesn’t mean the other parties are left out in the cold, however.

Other operators still in play for the Illinois market

DraftKings, PointsBet and theScore are free to negotiate deals with other parties in Illinois. By no means does this deal mean those operators are married to Penn.

It’s likely that all three will be interested in a state that contains the city of Chicago. That’s simply too big of a market to not at least make a run at.

Illinois bettors will likely also see parties not part of this deal active in the state eventually. The new gambling expansion law authorizes six new casinos, so there’s going to be plenty of opportunities for all.

It’s also possible, however not preferable, that companies like DraftKings and PointsBet could “go it alone” by being online-only operators in Illinois.

Partnering with a casino is essentially a marketing tool for sportsbooks. Casino patrons are the most likely people to bet on sports, so putting their brands in front of those people is important for sportsbooks.

The advantage for casinos in such deals is that sportsbooks are a strategy to increase foot traffic. The hope is that while people are there to bet on games, they will also play slots and table games.

When Penn launches its sportsbooks in Illinois, expect the Stars Group and Fox Bet to be involved. How much of a share of the market the Stars Group will get remains to be seen, but its inclusion at launch could give it a leg up on the competition.

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Derek Helling

Derek Helling is a freelance journalist who resides in Kansas City, Mo. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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