- Resorts World New York has launched a sports betting app called ResortsWorldBET.
- New York’s sportsbooks have attracted a ton of betting revenue but analysts suggest that most are losing millions due to the state’s absurd tax structure and regulatory framework.
- Resorts World operates two retail casinos in New York State.
Despite the fact that analysts have estimated that the companies operating in New York’s Ponzi scheme masquerading as a sports betting ecosystem have lost hundreds of millions in USD despite massive betting handle, there’s another company willing to put their balance sheet at risk. This time, the sucker is Resorts World New York which has launched a sports betting app called ResortsWorldBET. That leaves only one company–BallyBet–yet to launch their app in the New York quagmire.
The dismal numbers we’re hearing are shocking but not surprising. They’re based on DraftKings’ earnings which referred to their New York numbers as a ‘large negative contribution profit’. Sadly, the only good plan that DraftKings has for dealing with the revenue suck is hoping that the state reduces their tax burden. That seldom happens, particularly in a revenue addicted state like New York. Overall, the estimation–based on DK’s 25% market share–is that the companies in the New York mobile market have lost around $200 million USD despite the massive revenue numbers:
On Friday, DraftKings, which is one of the operators in the state, released earnings for the first time since its launch in NYS. The analyst estimated that the sportsbook has lost around US$50 million since its launch through the week that concluded on February 13, 2022. The company captured about 25% of the market, from which the expert calculated that the total loss of all operators comes to US$200 million.
In his calculations, the analyst takes into account its gross gaming revenue of US$47 million until February 13, 2022. And factors that the company is spending approximately 150% of that revenue on promotions, based on what it has done in other states. By subtracting the US$70 million in promotions and the US$24 million in taxes on gross gaming revenues, the expert determined losses of around US$50 million.
It’s simple math–the companies are operating as part of a bizarre ‘consortium’ under one of the legacy gaming providers in the state. They’re having to buy advertising and pay for marketing in the most expensive media market in the country. And the icing on top of it all is that 51% tax rate. With more than half of their betting revenue going to the state and an unknown percentage going to the juiced in legacy casino brand heading the ‘consortium’ that leaves very little to pay for overhead, salaries, advertising, promotional bonuses. You can forget about any money left over for profit. This metric won’t change no matter how glossy New York’s betting revenue reports.
The latest sucker to enter the fray is Resorts World. Here’s Robert DeSalvio, President, Genting Americas East, trying to rationalize this negative suck on company revenue:
“This is something our players and sports enthusiasts have wanted for a long time, and we’re excited to say Resorts World New York now has mobile sports betting. From our experience in having a Sportsbook in both our Catskills and Las Vegas properties, we were able to take feedback from our players and deliver what New Yorkers really want in a mobile sports betting app. By partnering with an innovative product and technology focused company in PointsBet as our platform provider, we believe Resorts WorldBET will only add to our success.”
The good news is that they’ve partnered with PointsBet aka ‘legitimate professionals’. The bad news is that you can add in yet another percentage going out the door before Resorts World can even think about a profit.
Darlene Monzo, Chief Marketing Officer, Genting America’s East, had these thoughts:
“For us, it’s all about providing a complete world class gaming experience and delivering the latest technology to our guests and loyal customers. Our players trust us, and we’re excited to provide a safe way for them to place their favorite sports bets through the Resorts WorldBET app, which they can do from the comfort of their couch, or in the big screen environment of Bar 360 in Queens, or Sportsbook 360 at Resorts World Catskills.”
Resorts World has two retail casinos in New York State but only one with a sportsbook. Their New York City property inexplicably doesn’t have a retail sportsbook. Probably a matter of ‘greasing the right palms’–or in this case *not* doing so.R