Could Competition, Regulator Discontent Force Massive Changes To GambetDC App?

In the 1990s, a memorable series of public service announcements using anthropomorphic crash test dummies advocated for seatbelt usage in automobiles on television. The footage essentially showed the carnage possible to the human body. Currently, the situation around the GambetDC app resembles that footage.

For sports bettors in Virginia, that could mean better and more options when they visit the nation’s capital.

The rise of competition for the DC Lottery online sports betting app has thus far nullified the app’s only advantage. That competition may soon become more robust. Additionally, it looks like people in power are becoming more open to radical changes.

DC Council committee hears testimony for GambetDC app

Last week, the Washington, DC Council‘s Committee on Business and Economic Development met for budgetary oversight reasons. Among other topics, the revenue (or more appropriately lack thereof) for the city from GambetDC became a matter of debate.

Presenting “the case” for the DC Lottery’s handling of its privileged position when it comes to legal sports betting in DC was the lottery’s general counsel, Ridgely Bennett. Bennett had the unenviable task of having to answer why the lottery’s return to the city in terms of sports betting tax revenue has been just $230,000 when projections called for $6 million this year.

Bennett pointed to the COVID-19 pandemic. He stated that the lifting of pandemic-related restrictions will allow the lottery to open retail locations. As far as why that would make a difference, Bennett stated that the lottery believes bettors prefer to make deposits with cash.

That’s in line with the lottery’s previous defenses of GambetDC’s underwhelming performance. Previously, the lottery stated a belief that DC bettors simply preferred a brick-and-mortar experience as the rationale for why the then-makeshift William Hill Sportsbook located in Capital One Arena was outperforming its app.

However, it seems the numbers tell a different story. That deviation of the facts from the lottery’s narrative came up quickly.

Council members air grievances

Bennett admitted to the council that William Hill – only available at and within a two-block radius of the Washington Capitals‘, Mystics‘, and Wizards‘ home – has brought in more than four times the amount of tax revenue for the city so far. Council members question whether the ability to use cash and interact with a person alone could be responsible for such a disparity.

Bennett replied that the lottery is working with the city to try to improve the odds and payouts available on the app. The GambetDC app is the only legal sportsbook available online throughout the District. For William Hill and the recently launched BetMGM Sportsbook, there are tight geofencing restrictions.

Councilman Kenyan McDuffie was the most vocal pessimist when it came to the lottery’s belief that it can turn things around on GambetDC.

“I am admittedly less confident than you are,” McDuffie said. “As I continue to delve deep into this … I’ve got to tell you my confidence isn’t growing. It isn’t improving.”

More reason for McDuffie to lose confidence in GambetDC could be on the way soon. That could take the form of another national brand opening up shop in the District.

Enter FanDuel

FanDuel Sportsbook already had an agreement in place with the MLS side DC United for a book at Audi Field. Last week, though, it finally applied for a license. Pending regulatory approval, that would create another limited competitor for the lottery.

Plans for a retail sportsbook at Audi Field are not yet public. DC residents and visitors who frequent the stadium should expect to be able to use the app within a two-block radius eventually, though.

By the time that happens, could the lottery’s product see improvements? Also, might those tight geofencing requirements become part of the damage from GambetDC’s slow-motion crash? It’s too early to tell.

DC Lottery controls its own fate, for now

For the time being, the DC Council seems satiated by commitments to improvement. However, it’s uncertain how long that patience will last. Right now, the lottery is betting its future on three things:

• Improved odds and payouts will equalize the lottery’s market share
• Loosened COVID-19 protocols will bring people back into the city
• Placement of betting kiosks throughout the city will increase handle

If BetMGM and William Hill (plus FanDuel possibly) continue to outperform the lottery’s model by a big margin, then all bets might be off. The council might decide that the city would be better off with a more open regulatory model.

The original motivation behind the lottery advantage was a higher tax rate on that revenue would, in turn, mean more money for the city. So far, though, that math hasn’t worked out. To date, the city might have actually collected more revenue if William Hill was available throughout the District.

A similar change would also make BetMGM and potentially FanDuel available anywhere in DC as well. Thus, the landscape of legal betting could more closely resemble that which Virginians are already becoming accustomed to.

Like a crash test car, the GambetDC app is now hurling toward what could be an ugly demise. If the lottery isn’t able to buckle up with an improved product soon, there might not be much left of its sports betting platform.