It's Complicated
Another state says yes to interstate online poker. What the gambling world thinks of ESPN Bet. An old school sportsbook up for auction.
The Bulletin Board
NEWS: Interstate poker gets a boost with the addition of West Virginia.
NEWS: Early impressions of ESPN Bet from analysts and peers.
ICYMI NEWS: Stories and updates from around the gambling universe.
VIEWS: The final act in the BetOnSports saga.
AROUND the WATERCOOLER: What does X (Twitter) think of ESPN Bet? Actions and consequences.
STRAY THOUGHTS: It’s an obscure reference.
SPONSOR’S MESSAGE - Underdog: the most innovative company in sports gaming.
At Underdog we use our own tech stack to create the industry’s most popular games, designing products specifically for the American sports fan.
Join us as we build the future of sports gaming.
Visit: https://underdogfantasy.com/careers
West Virginia Joins the MSIGA
US online poker took a small but incredibly significant step forward on Tuesday. West Virginia, one of eight states to legalize online poker, has joined the Multi-State Internet Gaming Agreement (MSIGA) and can pool online poker players with other MSIGA states: New Jersey, Nevada, Delaware, and Michigan.
West Virginia Delegate and NCLGS President Shawn Fluharty, who has been a champion of legal online gambling in the state, tweeted, “We can officially welcome West Virginia to the party! Great work by many at WV Lottery to help this become a reality. Deal em up,” in response to the news.
The addition of West Virginia didn’t come out of nowhere. In November 2022, Fluharty said, “I predict we will indeed be off the sidelines” in 2023. And last month, he tweeted, “Hopefully the interstate compacts are finalized soon, and we can deal em up!”
West Virginia is a small population state that won’t tremendously impact US online poker numbers. Its real impact is driving momentum and bringing Pennsylvania closer to joining the MSIGA.
That’s the good news. The bad news is West Virginia is likely many months away from pooling players with the other MSIGA states for two reasons.
Reason #1: West Virginia Needs Online Poker Sites
Online poker is legal in West Virginia, but zero online poker sites have launched.
As PokerFuse noted:
“Although online poker in West Virginia has been legal since 2019, none of the operators currently deployed in the state for online casino gaming are offering poker — likely because of the state’s small population (1.8 million residents) and because it had not signed a pact like MSIGA to allow for multi-state play.”
Several online casino operators with affiliated poker products are live in West Virginia: BetMGM, PokerStars, Rush Street Interactive (Run It Once), and WSOP.com.
Getting online poker up and running will take some time, as regulators want to test these products.
Reason #2: Interstate Pooling Takes Time
The time between joining the MSIGA and pooling players has taken other states 7-13 months.
As New Jersey Division of Gaming Enforcement Director David Rebuck has told me multiple times, “It’s just not a matter of flipping a switch and saying, we’re going to turn on the Internet today.”
Nevada and Delaware announced the Multi-State Internet Gaming Association in February 2014. They began sharing players in March 2015.
New Jersey joined the MSIGA in October 2017. Player pooling began in May 2018.
Michigan’s entry into the MSIGA was in May 2022. It began pooling players in January 2023.
Stipulations
An important point is player pooling can only occur between like operators.
The current interstate pools are:
888/WSOP.com in New Jersey, Nevada, and Delaware (RSI will soon replace 888 in Delaware)
PokerStars in New Jersey and Michigan
BetMGM and WSOP.com can pool players in Michigan and New Jersey but haven’t yet.
ESPN Bet Analysis from Around the Internet
Retention, Retention, Retention
Analysts see a lot of customer acquisition potential, but the overarching question is retention, as Sports Handle’s Matt Rybaltowski noted in a deep dive into ESPN Bet:
“Joe Stauff, an analyst with Susquehanna Financial Group, has high conviction that ESPN BET and its large top-of-funnel will generate interest, but it needs to “discover” the level of retention first. The retention capabilities, he wrote, will be driven by product quality.
“Another analyst, Ryan Sigdahl of Craig-Hallum Capital Group, anticipates strong user acquisition and handle share gains for ESPN BET, but he awaits better clarity around retention and considerations such as product performance, integrations, and competitive dynamics.”
Retention is a question I’ve raised many times, most recently regarding Fanatics:
“The big question is, can Fanatics continue to gain momentum, which requires the company to bring in new customers and lure customers away from competitors, and most importantly, retain those customers?”
EKG on ESPN
Over on LinkedIn, Eilers & Krejcik Gaming’s Chris Krafcik cautioned that usable data is likely months away.
“When the November data is released ... months from now, it will only tell a partial story (i.e., Nov. 14th-30th),” Krafcik said. “Given the shortened month, there is bound to be breathless and largely useless per-day extrapolation… A partial launch month won’t tell us much, if anything, useful.”
And as Krafcik noted, expect to see lots of conjecture around app downloads and Google search data. “The sell side is going to hammer this metric [app downloads] (we will grudgingly cover too), but DLs should be treated with ample pinches—even heaps—of salt, especially in an app’s launch week.”
At the end of the day, Krafcik believes the success/failure of ESPN Bet will come down to product performance. “How stable is the ESPN Bet app across multiple states? How does its feature set compare to those of rivals? What are its live betting processing times? How intuitive is navigation?”
Conflict of Interest (Real or Perceived)
ESPN has issued betting guidelines for its talent, but during a recent episode of the Prime Suspects podcast, the question of avoiding conflicts of interest was raised.
Joe Brennan noted that Prime Sports and other licensed books are already required to filter out anyone who might have influence over the game or insider information. Brennan noted that ESPN personalities are already giving their picks, which could lead to a conflict of interest or, at the very least, the perception of its on-air talent steering customers toward bad markets.
Prime’s Adam Bjorin called ESPN’s on-air talent a “can of worms.”
Sponsorship opportunity
Want to sponsor the fastest-growing newsletter in the gambling space? Straight to the Point has multiple sponsorship opportunities available.
Reach out to Steve at iGamingPundit.com for more details.
ICYMI: PokerStars NAPT; Maine Revenue; RakeTech’s US Struggles
The PokerStars North American Poker Tour returned for the first time since 2011 and didn’t disappoint. The nine-day series generated a 1,095-player Main Event, which was one of three events with top prizes of six figures.
Maine sports bettors wagered just under $4 million over the first three days of legal sports betting in the state. DraftKings accounted for most of the bets at $3.4 million, while Caesars (partnered with three Maine tribes) came in at $530k.
RakeTech CEO Oskar Mühlbach said the company was “a little bit behind plan” in the US during the company’s Q3 earnings call. “It has taken us a longer time than initially expected to roll out our affiliation efforts in the US.” Of possible interest to readers, RakeTech was not a part of the recently announced RGAA trade group.
BetOnSports Domain Up For Auction
Friend of the newsletter, Mike Murphy (check out his flagship affiliate site, Betting USA, which has some of the best and most honest reviews you’ll find), put this very interesting story on my radar.
As Mike tweeted:
“Someone let BetOnSports (.com) domain expire, and it's now in auction. This domain has a LONG history, going back to the arrest and extradition of Gary Kaplan and other founders for operating an illegal online sportsbook.”
As I wrote in a 2022 column on the difficulty of prosecuting offshore gambling sites, BetOnSports was one of the few big wins for law enforcement:
“One of the few times the DOJ ‘got its man’ was Jay Cohen, the CEO of World Sports Exchange, an Antigua-based online sportsbook. Charged in 1998, Cohen was convicted in 2000 for violating the Wire Act.
“Another victory was BetOnSports CEO, David Carruthers. The DOJ notched a win because Carruthers had a layover flight in Dallas from the UK to Costa Rica. In 2010, BetOnSports founder Gary Kaplan received a 51-month sentence after CEO David Carruthers pleaded guilty and testified against other defendants. And as was the case with Black Friday, the charges against BetOnSports were primarily financial.”
Around the Watercooler
Social media conversations, rumors, and gossip.
A Robert Linehan tweet has received quite a few responses, with most of the replies calling the ESPN Bet app “Barstool 2.0” and, as Sports Betting Twitter is prone to do, complaining and praising the bonuses.
File this under actions (likely) have consequences.
Several Catena employees were never shy in expressing their disdain for the Barstool brand and essentially rooting for it to fail, which may have cost the company a relationship with ESPN Bet.
Stray Thoughts
Today’s newsletter is near the email length, so I’ll make this short and sweet. One of my favorite parts of the newsletter is receiving messages from people who get the movie/music/pop culture references I include.