The iGaming Market in New York Could Be a Dream For Some Entities as the Empire State Sets $500 Million Fee For a License
As we reach 2023, the iGaming industry continues to expand its target demographic by gaining market access.
As we reach 2023, the iGaming industry continues to expand its target demographic by gaining market access. Many states across the nation are looking to join, but it may come at a hefty price for some jurisdictions compared to others.
Why Some Entities Will Be Willing to Pay the Hefty Price
Sports betting was a major success for many states across the nation as some reached or surpassed the $1 billion mark in numerous monthly handles. It will cost a lot to get a casino license to go digital, but it may be worth it in the long run for some more than others.
New York is the biggest sports betting market in the nation, but many CEOs, and others have expressed their concerns with the high tax rate based on revenue, which is set at 51 percent. The only other state that shares the same tax rate is New Hampshire.
Nevertheless, the state wants to avoid making hasty changes that could have an effect on monthly revenues. The generated revenue from the operators is geared toward funding educational programs and youth sports across the Empire State.
There are rumors that the tax rate will remain unchanged when the legislative session begins in the early portion of 2023. Despite that, there are discussions about adding more options for which the consumers could bet on as the bookmakers are looking for ways to become profitable.
Can iGaming Become a Reality Sooner Rather Than Later in New York?
Unlike neighboring New Jersey and Pennsylvania, New York isn’t a part of the iGaming industry yet. However, the online casino sector of the business has proven to produce much larger monthly handles and revenue numbers than sports betting ever could.
The operation could become a reality sooner rather than later in New York if the advocates could pass a bill in the upcoming legislative session. Regardless of the session, the potential operation is set to be an expensive one as the initial cost may shock many.
On Tuesday, the state’s site committee announced new rules requiring casino operators in New York to pay a minimum fee of $500 million for a gambling license. This applies to all three casinos in the state.
Why This Could Deter Some Locations in the Future?
If one cannot keep up with the rest of the competition, this may spell trouble in the short and long term in the grand scheme of things. The reason is bidders that receive the approval will be given a 30-day window to come up with the funds.
The length of the first casino license will be determined by the investment made by the winning bidder, ranging from 10 to 30 years. The state’s revenue from this license will largely depend on the quality of the bidder’s proposal, as it will be seen as an elevator pitch. There is expected to be a high number of competitors for the limited number of available licenses.