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FanDuel Group, which was required to exit Nevada’s legal gaming market almost seven years ago, will re-enter the state as a licensed company after gaming regulators approved its partnership with Boyd Gaming to redevelop and rebrand a retail sportsbook in downtown Las Vegas.
The Nevada Gaming Commission (NGC) voted unanimously Thursday (August 25) to license Betfair Interactive US LLC, which does business as FanDuel, to provide betting odds and make recommendations on wager line movements to employees of the sportsbook at Boyd’s Fremont casino.
The Fremont sportsbook will be rebranded as a FanDuel Sportsbook, but its personnel will still be Boyd employees. FanDuel will receive an undisclosed percentage of gaming revenue from the Fremont sportsbook.
The collaboration between FanDuel and Boyd is expected to begin by the end of the year.
Approval of FanDuel’s license did include a condition that restricts its employees from performing any tasks that constitute the operation of a sportsbook. The company’s gaming license is limited to “selling or otherwise providing information … that is used primarily to aid the place of wagers on events of any kind.”
That information includes line, point spread, or odds, as well as information, advice or consulting considered by Boyd as the licensed sports pool, in establishing or setting any line, point spread or odds. FanDuel can also only “offer advice, estimate, or prediction regarding the outcome of an event.”
Boyd will continue to operate the sportsbook. The company, which operates ten casinos in southern Nevada, will also continue to operate its Boyd Sports retail and mobile wagering business.
The NGC on Thursday also licensed FanDuel’s parent company, Flutter Entertainment, and a half-dozen Flutter executives.
Erica Okerberg, an attorney with Greenberg Traurig and outside counsel for Flutter, told the five-member commission that FanDuel does not plan to offer a mobile sports-betting app in Nevada, but if that were to change, they would meet with state gaming regulators.
FanDuel CEO Amy Howe said “never say never” about the possibility of applying for licensing to provide other services.
Currently, the company cannot offer daily fantasy sports (DFS) or sports betting in Nevada because it is not licensed as an “operator of a sports pool” and does not have a retail location, Okerberg said.
The approval of FanDuel’s license Thursday allows the company back into Nevada for the first time since October 2015, when the Nevada Gaming Control Board (NGCB) ruled that DFS was a form of sports betting and companies had to be licensed as sports-betting providers.
That meant FanDuel, DraftKings and other DFS companies were forced to shut down their Nevada operations.
Maryland Advances DraftKings License Application
The Maryland Lottery and Gaming Control Commission (MLGCC) also advanced DraftKings’ application for a retail sports-betting license on Thursday, as the gaming company took another step toward operating a sportsbook in the state.
The commission determined that DraftKings met the qualifications necessary to being approved for a sports wagering facility operator license.
The Maryland State Fairgrounds in Timonium, which will host the sportsbook, needs to go before the state’s Sports Wagering Application Review Commission (SWARC), for a license after the MLGCC has found it to be qualified.
The SWARC is scheduled to meet next month.
Crown Maryland Gaming LLC, doing business in the state as DraftKings, plans to open a retail facility at the Maryland State Fairgrounds. Joe DeCristofaro, vice president of investor relations, did not say Thursday when DraftKings would open the facility.
Currently, FanDuel, BetMGM, Caesars Entertainment and Barstool Sportsbook have begun operating retail wagering in Maryland. John Martin, director of the Maryland Lottery and Gaming Control Authority (MLGCA), told commissioners that mobile wagering is not expected to launch until February.
During DraftKings’ licensing hearing, MLGCC chair E. Randolph Marriner expressed concern over the company’s “staggering” $3bn in losses over a five-year period ending on December 31, 2021. Marriner also expressed dismay that the company was projecting another $800m in losses for this year.
“It seems to me that you are excited that you are only going to lose another $800m this year,” Marriner said. “These numbers are quite staggering to me.”
Marriner asked DeCristofaro for his outlook for the company’s finances.
“I appreciate your question,” he said. “Our outlook is extremely positive. We started out the year with a greater loss expectation and that has actually narrowed considerable to around $800m.”
The reason for the losses, DeCristofaro said, is that “we are starting up a brand new business.” He noted that there is an upfront cost, and then a company earns a return on that investment over a period time.
As a condition of approval, DraftKings agreed to an annual review of its finances. John Mooney, managing director MLGCA’s regulatory oversight, said normally, such reviews are conducted every five years when a license is renewed.
As of June 30, DraftKings had about $1.5bn in cash. DeCristofaro reminded commissioners the gaming company expects to turn its first quarter profit in the fourth quarter of 2023, with DraftKings expecting to post its first full-year profit in 2024.
