Wynn Resorts caught a lot of gambling industry watchers off guard last month when it abruptly announced WynnBet online sportsbooks in seven states would be taken offline.
Wynn’s list of soon-to-be vacated locales did not include the two states where it has land-based casinos — Nevada and Massachusetts — nor did it include Arizona, Michigan (for now) or New York.
Wynn choosing to keep WynnBet open in Nevada and Massachusetts makes sense because of the company’s physical presence. Michigan is logical because WynnBet also has an online casino in the Great Lakes State. WynnBet performs reasonably in Arizona compared to its other locations.
New York is not as straightforward. Keeping WynnBet active as one of the nine online sportsbooks in NY requires a little deeper reasoning.
WynnBet remains active in New York. Why?
The WynnBet NY online sportsbook does not perform well in New York, ranking only ahead of Resorts World and BallyBet. New York does not have legal online casinos. And Wynn Resorts, arguably the pinnacle of luxury casino hotels in the US, does not have a retail operation in the Empire State.
So what is Wynn doing in NY?
Those last two items may be the key to understanding Wynn’s thinking in keeping its online sportsbook open in NY.
Online casinos, which are exponentially more profitable for gambling operators than sportsbooks, could be coming to NY in the near future. As for land-based casinos, Wynn is in the running for a downstate NY gaming license and is proposing to build a luxury resort in Manhattan.
Staying in NY with its underperforming online sportsbook app could give Wynn Resorts an inside track on a potential NY online casino and a full-fledged casino hotel in the Big Apple. Keeping the digital brand in the forefront for NY customers (and state gaming regulators) should either internet casino or a downstate casino come to fruition is a smart business decision.
For what it’s worth, no NY law requires WynnBet to stay online
PlayNY looked into the possibility of a “dormancy clause” or other comparable language in NY’s sports betting law that requires operators to “use it or lose it” when it comes to the highly coveted online sports betting licenses.
Perhaps, the reasoning went, Wynn was only keeping its NY sports betting app alive because the law required them to.
Turns out, that’s not the case.
There is nothing in the state’s Racing, Pari-Mutuel and Breeding Law (the formal name of the sports betting regulations) that mandates a license holder be operational.
For the time being, WynnBet NY is generating revenue, even if it’s not to the level finance executives in Las Vegas would hope for.
WynnBet NY not even close to breaking even
New York is the largest legal sports market in the US.
Through August 2023, WynnBet has generated a little more than $10.2 million in NY sports betting revenue on over $163 million in total wagers, paying over $5.2 million in state tax revenue.
That’s not a lot considering Wynn (and others) paid $25 million for a NY online sports wagering license. The “winning” nine operators also fork over 51% (yes, more than half) of internet sports gambling revenue to the state in taxes.
Wynn is so bullish on the possibility of either (or both) online casino access in New York or a Manhattan casino resort that it is willing to keep putting resources behind an underwhelming – and possibly costly – online sportsbook.
Or, maybe it sells the online sports betting license to an up-and-coming competitor – ESPN Bet, for example – for a king’s ransom?
Welcome to legal, regulated gambling in 2023.
