Since DraftKings was able to launch their online sports betting service within New Jersey, they have achieved levels of success which are far beyond that which was expected. This now reached a point where Jason Robins, CEO for DraftKings, is admitting that the online sportsbook industry in New Jersey has become a substantial part of their business. The company which originated as a provider of fantasy sports is quickly changing into a critical role-player within the sports betting industry. They want to expand on this success and is hoping to do so sooner rather than later. Currently, about 33% of their annual income came from New Jersey’s sportsbook, even though the state only homes about 3% of the entire population of the United States.
The Hope to Expand
Due to the tremendous success which DraftKings achieved in New Jersey, they are keen on expanding to many more states. They are also hoping to be able to do this before the start of the NFL season. The NFL season is a very lucrative time for their industry with various opportunities to earn revenue. DraftKings’s primary income is still, however, fantasy sports, but this is changing at a rapid pace. Although the fantasy sports market is still growing, it is at a much slower pace of 15 – 20% per annum, while the legal sports betting industry showed an increase in their turnover of 50-60%.
A Wave is Ahead in Future
Robins predicted that in an estimated period of five to seven years, about 66% of the country would have legal access to live online sports betting. This wave is pushed forward at high speed due to the success which New Jersey has shown. In their first year, the state of New Jersey generated about $26 million through tax revenue. This figure was released by the state of New Jersey’s gambling authority. At this stage, eight other countries are in a country where sports betting should be legalized soon. Of these eight states, DraftKings is trying to run sportsbooks in at least four of them. The four which they have set their eye on are West Virginia, Indiana, Pennsylvania and Iowa.
The Effect of Legalized Sports Betting
The process of legalizing sports betting is often compared to authorizing the use of cannabis. Lawmakers are convinced that it is far more beneficial to sanction the action of sports betting and generate revenue from it than letting it grow as an underground activity. Currently, it is estimated that illegal betting is a market valued around $150 billion annually. Even though change is coming, the pace at which it happens is frustrating to various role-players, like DraftKings. The speeds at which legislative changes occur is not the same as that at which independent companies grow. The only solution is to give it time to pass through all the democratic processes which are required.
