DraftKings’ Robins pushes iGaming legislation, touts California sports betting potential

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DraftKings CEO Jason Robins encouraged state lawmakers to embrace legal online casino gaming and touted the potential benefits of California mobile sports betting while addressing a gaming industry conference Friday.

Speaking to a crowd of several hundred state elected officials, regulators and gaming industry stakeholders, Robins said policymakers need to overcome political and educational obstacles that have largely prevented wide-scale implementation of regulated mobile casino gaming.

“It is time for your states to adopt iGaming, not in the future, but now,” Robins said during the National Council of Legislators from Gaming States (NCLGS) conference Friday in Boston. “IGaming is as safe as brick-and-mortar casino gaming and taps into a potential revenue stream that is currently being funneled into unregulated offshore operators.”

Though sports betting is legal in some form in more than 30 jurisdictions, commercial online casino gaming and/or iPoker is only legal in some capacity in six. Elected officials in even states with regulated online sportsbooks have been far less likely to support full mobile casino gaming over fears about tech and privacy protections as well as revenue cannibalization for existing retail casinos, among additional concerns.

“The stigma and fear associated with online gaming seem to rely on inaccurate and outdated ideas of how technology works,” Robins said. “Sophisticated regulated online gaming operators employ all of the same technology and safeguards as mobile sports.”

Robins also said Friday none of the six current commercial online casino gaming markets have seen a corresponding decrease in revenues for their respective brick-and-mortar facilities.

“DraftKings CEO Jason Robins: It is time for your states to adapt iGaming, not in the future but now. IGaming is as safe as brick-and-mortar casino gaming and taps into a potential revenue stream that is currently being funneled into unregulated offshore operators.”

Chairman Rodney Butler of the Mashantucket Pequot tribe, whose Foxwoods Resort Casino in Connecticut is partnered with DraftKings for online sports betting and casino gaming, said as much during an earlier NCLGS conference panel Friday. Robins specifically mentioned Butler and the Mashantucket Pequots as an example of online offerings bolstering not only casino stakeholders but government coffers as he advocated for additional online casino legalization.

While US sportsbooks have collectively held roughly 7% of handle, online casino games such as digital slots and table games have proven far more lucrative. For many major sportsbook operators and state governments, online sportsbooks are increasingly a way to entice customers to online casino offerings instead of a major standalone revenue driver.

Reading from prepared remarks, Robins also highlighted the benefits of a DraftKings-backed sports betting ballot measure in California. If approved by voters this fall, 85 percent of tax proceeds would go to homelessness prevention and mental health support initiatives. The rest would go to California tribes that don’t participate in gaming.

“We are incredibly excited in the prospect of responsibly bringing online sports betting while protecting minors and other vulnerable populations and providing much-needed funding for critical issues like homelessness and mental health,” Robins said. “It is creative solutions to societal problems like the aforementioned proposal that makes me most excited for the possibilities in the gaming industry.”

DraftKings, along with competitors FanDuel and BetMGM, are the largest financial backers of the California online sports betting measure- and would be among its biggest beneficiaries. The initiative will be on the same ballot as a competing measure supported by many of the state’s major gaming tribes. It would exclusively permit retail sportsbooks at certain tribal casinos and horse tracks.

Since Robins helped found the company in Boston nearly a decade ago as a daily fantasy sports purveyor, DraftKings has grown into one of the top three online sportsbook and casino operators by handle and revenue in the country, along with its two aforementioned rivals. Like virtually all other U.S. sportsbooks, DraftKings has not seen its online gaming division turn a profit in the more than four years since states outside Nevada were allowed to legalize single-game sports betting.

The company has funneled hundreds of millions of dollars in marketing, free bets and other promotions as it looks to acquire market share. It expects to lose more than $700 million in calendar year 2022 alone.

Robins, and other sportsbook operators, see the potential for California, far and away the nation’s most populated state, as a key piece to future profitability. DraftKings has committed tens of millions of dollars on behalf of the campaign – and would likely channel tens of millions more on marketing if successful.

“DraftKings CEO Jason Robins: We are incredibly excited in the prospect of responsibly bringing online sports betting while protecting minors and other vulnerable populations and providing much-needed funding for critical issues like homelessness and mental health.”

Speaking for less than 10 minutes Friday, Robins did not address sports betting legalization efforts in Massachusetts, home to DraftKings’ corporate headquarters and one of the company’s highest priority potential state gaming markets. Massachusetts state Rep. Jerry Parisella, speaking during a separate address at the NCLGS conference Friday, said lawmakers continue working on passing a bill before a de facto July 31 legislative deadline but offered no further specifics.

Robins also didn’t address online sports betting launches in Ohio, Kansas and Maryland, all of which are expected to go-live in the next three-to-12 months. The three new state markets have roughly 21 million combined residents.

Likewise, Robins offered no update on the 14.5-million person Ontario market, the most populated single North American jurisdiction with a DraftKings online casino and sportsbook. Ontario regulators have not revealed revenue figures since the province launched commercial iGaming and sports betting in April.

Robins has said in past company earnings calls he expects DraftKings to have less than the roughly average 20% market share it sees in most US states as the company deals with more than 30 other Ontario competitors, including some which have operated for years in a so-called “grey” market. Unlike many of its major US competitors, DraftKings did not launch until several months after the official go-live date.

Along with Ontario, DraftKings’ mobile sportsbook is already live in 17 of the 20 US states with statewide mobile sports betting. It also offers online casino gaming in New Jersey, Pennsylvania, Michigan, Connecticut and West Virginia, tied with FanDuel for the most iGaming jurisdictions of any operator.

“We still have work to do to educate, that this is actually a benefit,” Robins said about online casino gaming legalization. “It will add not just more tax revenue but more jobs and will grow everyone’s business.”

About the author

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Ryan Butler

Ryan is a veteran sports betting and iGaming regulation and breaking news journalist based in the US. A two-time Associated Press Sports Editors award winner, he has reported on sports and politics since 2012. He has covered the gaming industry since 2018. Ryan graduated from the University of Florida with a major in Journalism and a minor in Sport Management.

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