Madison Square Garden Bullish On Sports Betting During Earnings Call

Posted By Mike Mazzeo on August 24, 2021

Madison Square Garden continues to evaluate its sports betting options.

But the corporation is optimistic about what’s to come, as New York works through the bidding process.

“We continue to be in active discussions with many of the potential market participants and are increasingly bullish about this opportunity for our company,” MSG president Andy Lustgarten said during Monday’s Q4 earnings call.

MSG support remains TBD

Some New York teams elected to support specific bids.

The Yankees, Bills and Sabres supported the superbid from DraftKings, FanDuel, BetMGM and Ballys. Meanwhile, the Nets supported the bid from Fanatics and Penn National (Barstool Sportsbook).

The Knicks and Rangers, however, haven’t aligned themselves with anyone as of yet. They do have an existing partnership with DraftKings.

“We’ve got great relationships with the current market leaders through our current partnerships as well as ones that we — new entrants that are coming in. So we think we’re in the best position once we know who’s been selected to help drive those businesses,” Lustgarten said.

“We talked about the assets we have, we’re going to be able to blanket the market, and we’ll be able to do it better than any other partner could. And so we think that, that’s the right position for us to be in over the next short term as well the state works through the application process.”

Teams want in on the action

Lustgarten knew the numbers.

The Kambi bid projects $900 million in tax revenue for the state with a nine-operator, 51% rate model.

The “Big Four” FanDuel bid believes there’s the potential for $1.3 billion in tax revenue for the state by Year 3.

“So for us, it doesn’t — four or above is all — it’s going to be great and there’s going to be competition,” Lustgarten said. “They’re significant and it’s clear there’s a significant takeaway for these operators to bring home. And the way they’re going to do that is by driving their business. And there’s one, we believe, one company best suited to help and work with them, and that’s us, right? We blanket the market.”

Lustgarten continued: “We can blanket the market in a way no other company can and be a partner for whoever wins. May it be four or more, we’re looking at different deal structures, exclusive deals, nonexclusive deals. We’re talking to everybody who’s in the market, and we think this is a great opportunity for us and a great opportunity for New York State.”

The possibility exists for New York arenas and stadiums to have their own sportsbooks/lounges, betting kiosks or a combination of both. There’s a lot of potential money on the line, and teams want in on the action.

“Media, sports betting, crypto—we see all those things converging a little bit,” Nets’ owner Joe Tsai told Sportico. “You can’t talk about sports betting these days without thinking how that affects your media rights. And maybe, for the betting fan base, injecting a little bit of crypto will be interesting.”

Photo by Seth Wenig, Pool / The Associated Press
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Mike Mazzeo

Mike Mazzeo has covered New York sports since 2010, previously working as a beat writer and columnist for ESPN (Nets), Yahoo Sports (NBA/MLB) and the New York Daily News (Yankees). His work has also been published in the New York Times, New York Post, Forbes and The Ringer.

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