Bally’s has earned the distinction of becoming the second active online sports betting platform in Rhode Island, a significant development for the local gaming landscape. This advancement follows the company’s successful acquisition of a sports betting license earlier this week, which showcases the growing complexities and competitive nature of the betting industry as it intersects with esports.
Rhode Island has been operating sports betting since 2019, but so far, the options for local bettors have been limited. Until now, Sportsbook Rhode Island was the only platform available for residents. The state recently renewed its agreement with International Game Technology (IGT) to manage this platform while simultaneously announcing the opportunity for a new contender to join the market. Bally’s emerged as the victor in this licensing round, with Lottery Deputy Director Michael O’Rourke revealing that the application process was not particularly competitive, citing only one other application from Rush Street Interactive.
High Tax Rate Puts Off Applicants
Despite the potential for growth in Rhode Island’s online sports betting scene, the high tax rate of 51% on gambling revenue has raised concerns and possibly deterred other operators from entering the fray. As O’Rourke mentioned, this prohibitive tax structure may have significantly limited responses to the bidding process. “There was hope we’d get more companies to reply, but they didn’t,” he explained to NBC 10, reflecting on the challenges facing prospective operators.
This 51% tax rate is among the highest in the nation, alongside similar rates in New York and New Hampshire. While New York has managed to capture the largest wagering volumes across the country, Rhode Island, with a population of just over 1 million, presents a less enticing opportunity for many operators. Bally’s, already an established player with two licensed casinos in Lincoln and Tiverton, is poised to capitalize on its existing foothold, benefiting not only from the online platform but also from the sportsbook revenue share under the state’s revenue-sharing model.
In Rhode Island, the distribution of taxes means 51% goes to the state, while the online operator retains 32%, and the physical sportsbook collects 17%. For Bally’s, this environment makes the establishment of its online betting platform an attractive venture.
Esports Betting Could Be Launched At Bally’s
Currently, Sportsbook Rhode Island does not offer betting on esports. However, Bally’s online betting platform, Bally Bet, is exploring the possibility of including a range of betting options for esports events. The platform is set to launch in November, and with Bally’s recent emphasis on the esports sector, there may soon be opportunities for local bettors to engage in this growing arena. In recent years, Bally’s has demonstrated an active interest in integrating esports into its business model, even making a $100 million bid to acquire Allied Esports in 2021, although this move ultimately fell to private equity firm Element Partners.
Additionally, that same year marked a milestone for Bally’s with its successful acquisition of Gamesys, which considerably strengthened its online betting capabilities. The technology stemming from this merger allows Bally’s to manage thousands of micro-bets each second, potentially expanding its offerings to encompass a broad array of in-play markets in the esports betting sector.
Looking ahead, Bally’s continues to build its online presence through strategic moves such as the rumored acquisition of Evoke, the parent company for prominent online betting brands like William Hill and 888. As the UK-based gambling group seeks prospective buyers amid its struggles, Bally’s appears to be a strong contender in the acquisition landscape, underlining the dynamic and evolving nature of the esports betting industry.
This latest development reflects not only potential growth for Bally’s in Rhode Island but also a greater trend towards legitimizing and expanding the esports betting market. As regulatory landscapes continue to evolve, the integration of esports with traditional betting platforms presents an array of opportunities, paving the way for a vibrant competitive gaming ecosystem that can appeal to a diverse audience of bettors. This movement underscores the potential for esports to significantly impact revenue streams, particularly in states like Rhode Island where sports betting is still maturing.