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Cuomo finally says yes to mobile sports betting

The question of when, if, and how mobile sports betting would be legalized in New York State is one that’s been asked many times in many places. That includes this website, where we’ve run multiple pieces on the topic in the past and discussed the pros and cons of such a move in detail. While we feel that the issue has been explored in full, the debate itself has mostly been pointless while we’ve been waiting for Governor Cuomo to show his hand on the matter. As of last week, he’s finally done so. Having faced months of pressure from campaign groups of both sides on the debate, he released a statement on January 5th and confirmed he was ready to move forward with proposals. We suspect that many people might have missed that news because of what happened in Washington the following day.

New York’s stance on sports betting has been puzzling for a long time. Following the Supreme Court’s move to make sports betting legal across the entire country in 2018, New York State responded relatively quickly and opened up sportsbooks the following year but didn’t make them available online or through mobile phones. That meant that the hobby remained available to millions of people – especially those in New York City itself, who would have to travel up to fifteen miles to find somewhere to place a bet. While neighboring states have taken full advantage of relaxed gambling laws and gone online with their offerings, banking millions of dollars worth of revenue in the process, New York State has been left behind.

It’s generally thought that Cuomo’s stance is at least partially based on the awkwardness of the state’s existing gambling laws and the difficulties that would come with trying to change them. As every New York-based gambler knows, it’s technically illegal to visit online slots websites in the state. That doesn’t stop being from doing so. Thanks to a loophole in the law, it’s technically permitted to visit and spend money on online slots that’s hosted outside the state, but not one that’s hosted within New York. That activity is neither specifically legal nor specifically illegal, and no legislative clarity has ever been provided on the topic. It could be argued that playing online slots is a risky enough activity even without the possibility of being prosecuted for doing so. It would be good to have certainty on the issue.

That certainty might soon come. If Cuomo is considering allowing sports betting via mobile phones, he must also, by definition, allow sports betting to happen via the internet. It’s difficult to imagine how a proposal might be drawn up that doesn’t also allow other forms of gambling activity to take place over the internet. That means online slots websites, internet poker, and other forms of gambling might slip through the net, much to the displeasure of anti-gambling activist groups. Cuomo is stuck between a rock and a hard place, but we can blame years of failing to update state gambling laws to take into account the existence of the internet for that. This is a task that should have been seen to more than a decade ago, and it’s become a more complex issue because of that oversight.

There are several pressing reasons why Cuomo has chosen this moment to open the door to online gambling companies. One of them is that money is being spent on online gambling in the state anyway, and at the moment, all of that money goes to companies based outside the state. That’s a loss of revenue for New York. The other is the harsh reality that New York is facing an unprecedented budget crisis because of the effects of the global pandemic and subsequent lockdowns and that the state’s authorities must do something to try to repair the damage. According to the most recent figures we’ve seen, the budget deficit now stands at more than fifty billion dollars. That money has to come from somewhere, and it’s not going to come from retail or tourism. Introducing new blood into the state’s economy to give it a shot in the arm is the most common-sense tactic that could be employed, and that’s what this new openness to the gambling industry represents.

As well as preparing to allow mobile sports betting, Cuomo is also reportedly considering looking again at New York State’s laws on cannabis. That’s led some media outlets – the Financial Times, for instance – to unkindly suggest that Cuomo is trying to solve New York’s problems by going ‘all in’ on vice. That’s not necessarily fair. New York has sat back and watched other states make billions of dollars from legalizing or relaxing attitudes to cannabis, and the state’s politicians and leaders are also aware that twenty percent of New Jersey’s gargantuan betting revenues are generated by people living in New York State. Some people might have moral or ethical objections to relaxing the state’s stance on either issue, but there’s a point where ignoring what’s going on and suffering financially because of it becomes economically illiterate. Cuomo’s harshest critics might argue that moment arrived some time ago.

Having answered the question of “will it happen,” the next questions for Cuomo to answer are “when” and “how.” From what he’s said, he favors an approach that would see the state lottery handle sports betting rather than casinos or firms from outside. Based on what’s happened elsewhere in the USA, that might not be the best approach. Washington D.C. should be an enormous betting market, but success there has been limited because the markets go through GameBet DC. William Hill, a British firm, makes five times more through sports bets in D.C. than GameBet does, and keeps far more of the profit. Had William Hill been put in charge of the entire operation, the state would be making far more money. If Cuomo has chosen to let gambling in, it might make the most sense to let it all the way in rather than hand it off to the state lottery and hope for the best.

Proponents of liberalized gambling laws have been waiting a long time for this moment and will now be watching carefully to see what happens next. It might take months for a solid proposal to be drawn up and even longer for it to be voted on. Even with this newly-positive attitude, don’t be surprised if it takes until 2022 for you to bet on your preferred sports competitions through your mobile phone. This is politics, and politics moves at a glacial pace.

Categories: NewsPolitics