Earlier this week, the New York State Gaming Commission approved Fanatics’ acquisition of PointsBet New York LLC which will now allow the ever-expanding gaming company to compete in the Empire State.
Welcome to New York
Fanatics’ entry into the largest betting market in the nation was accomplished by its acquisition of the U.S. assets of PointsBet, an Australian-based bookmaker that had struggled to gain traction in the domestic market. And acquiring PointsBet’s New York license was one of the main reasons why Fanatics spent $225 million to buy those assets.
On Tuesday, the company’s grand plan manifested when the New York State Gaming Commission approved Fanatics Betting and Gaming’s acquisition of PointsBet New York LLC. It was a seminal moment for the sports merchandising giant turned bookmaker and one that will see them compete against seven other competitors including Caesars Sportsbook, DraftKings, FanDuel, BetMGM, BetRivers, WynnBet, and Resorts World Bet.
Fanatics issued the following statement after its approval, “Today, the New York State Gaming Commission approved Fanatics Betting and Gaming’s acquisition of PointsBet New York LLC. We would like to thank the commissioners and staff of the New York State Gaming Commission for their time and effort in delivering us some great news today.
“We look forward to working with the staff of the New York State Gaming Commission to bring the Fanatics Sportsbook to the largest sports wagering state in the U.S.”
Fanatics has not revealed when it plans to launch in New York.
Fanatics CEO Sings Different Tune
Fanatics CEO Michael Rubin famously said, “…you can’t make money” in New York due to the onerous 51% tax rate, the steepest in the country and tied only with New Hampshire and Rhode Island.
However, in Rhode Island, William Hill (Caesars) is the sole provider of online sports betting through its arrangement with the state lottery while DraftKings was awarded the monopoly in New Hampshire which is why both companies are willing to pay such an exorbitant tax to do business in such sparsely populated states.
“We’ll be in every major state other than New York, where you can’t make money, by next football season,” Rubin said last year. Rubin made his disparaging comments about the New York market only after his company was turned down for a license.
After the comment was made, SportTrade CEO Alex Kane snarkily tweeted: “Interesting. Were you aware of the tax rate when you applied to get into NY?”
Although Rubin has yet to be reached for comment, the fact that Fanatics sought and successfully acquired PointsBet’s New York license says everything you need to know about his desire to compete in the largest mobile sports betting market in the country.
A Game-Changing Vision
Fanatics’ database of 95 million customers as a sports merchandising giant is an ideal crossover to the bookmaking business. This is the competitive edge Fanatics is banking on, despite its late arrival into the sports betting industry.
Rubin has visions for his company to become a one-stop-shop for sports fans and bettors, many of whom are one and the same.
“There’s not another company thinking about how do you give hundreds of millions – or maybe even long-term billions – of sports fans one place to do everything they want to do digitally,” said Rubin. “That’s going to be buying merchandise, buying and trading collectibles, betting on sports. Over time, watching live sports, maybe getting tickets from our place.”