On November 6, 2019, Colorado became the 19th state to legalize a form of sports betting. Starting in May, Colorado’s 33 casinos will have the opportunity to offer in-person and online wagering on professional, collegiate, motor and Olympic sports. The bill legalizing sports gambling requires a 10% tax on net sports betting proceeds, something that will largely benefit Colorado’s water projects. The tax benefits from legalizing sports betting in Colorado is expected to generate roughly $11M the next fiscal year alone. Although the bill is intended for just the casinos in the mountains of Central City, Cripple Creek, and Black Hawk; these brick and mortar shops will undoubtedly offer online operations for individuals who would rather place bets from their couch.
Casinos are just one of the many entities that stand to profit from the legalization of sports gambling that is quickly sweeping through the United States. The 2018 SCOTUS ruling that opened the door for states to legalize sports gambling has been met with a lot of positivity. It seems inevitable that every state will legalize some form of sports gambling in the not too distant future. However, it is interesting to see who stands to gain the most from this legislation.
Casinos are being forced to build out online applications if they hope to keep up with other online platforms positioned for immediate success. Well-known platforms like DraftKings and Fan Duel seem to be better positioned for success in the era of the internet. While brick and mortar casinos in Colorado will undoubtedly see an increase of foot traffic because of the legalization of sports betting,
DraftKings and FanDuel will be ready to launch on day one with a large population of active users ready to double down on sports bets rather than just their fantasy sports bets. For reference, online gambling accounted for 80% of all sports bets in New Jersey last year. If anyone is keeping track at home, there are twenty–three casinos and pari-mutuel facilities in New Jersey.
Those who enjoy placing wagers on sports team have reason to celebrate or will have reason to celebrate soon. Today, it is the sports betters who reside in Colorado that have reason to celebrate. For those waiting on their home state to pass similar legislation, it seems like your day will be upon you soon enough. On the other hand, the casinos and online platforms such as DraftKings and Fan Duel seem to be lining up for a battle. If New Jersey were the template for each state, it would seem as if the casinos would not be able to put up much of a battle.
However, because each state will have the opportunity to set its own guidelines through various rules and regulations, there will be different opportunities for each entity on a state by state basis. Thus far, competition is a good thing for consumers. The legalization of sports betting in Colorado will provide another data point for states and individuals alike as we watch how things unfold across the nation.