IGA Tradeshow: Igaming expansion more difficult despite its success

April 16, 2024 8:59 PM
Photo: CDC Gaming Reports
  • Buck Wargo, CDC Gaming Reports
April 16, 2024 8:59 PM
  • Buck Wargo, CDC Gaming Reports

A former Michigan legislator instrumental in that state’s gaming expansion and a lobbyist for Fanatics Betting & Gaming said it’s more difficult to get igaming passed today in the U.S. than it was four years ago, even though it’s successful where enacted and not cannibalizing land-based properties.

Story continues below

Brandt Iden, vice president of government affairs for Fanatics Betting & Gaming, spoke at last week’s Indian Gaming Tradeshow & Convention during a session on tribal partnerships. He said that many tribes aren’t interested in igaming and are in no rush to offer it; they’re happy with the state of their casino properties at this time. The Michigan model of online sports betting and igaming, he said, was a “heavy lift.”

A member of the Michigan House of Representatives from 2014 to 2020, Iden was deemed the architect of Michigan’s Lawful Internet Gaming Act, serving as the lead sponsor of legislation that legalized internet gambling, sports betting, and advance-deposit wagering (ADW) for pari-mutuel horse racing.

“As you look across the country right now, it’s much harder to pass igaming legislation today than when I passed it four years ago,” Iden said. “The market dynamics and media have changed. There’s a different view of gaming, igaming in particular. It has to be everybody truly working in the same direction and something states want to do. I can try from a legislation standpoint, but if states don’t want to do it, I’m spinning my wheels.”

Observers have suggested a state’s need for revenue will prompt expansion in the future.

Iden pointed to March gaming numbers for Michigan, its best gaming revenue month since February 2019. It showed the industry has come through the pandemic.

“There were some union issues in Detroit and casinos were closed for a while. But here are today with robust and mature online sports betting, daily fantasy, ADW, and icasino and the best month these casino properties have had since 2019. I think that ends the cannibalization debate.”

When adding in demographic changes, the market has been “tremendously successful” and everybody has won from the tribes, commercial casinos, and employees. “The state is killing it,” he said.

Rich Roberts, president of Mohegan Digital and responsible for igaming and sports betting for the tribe, said the benefits in Connecticut have been tremendous. It has expanded the pool of players for the casino and expanded the brand.

“We heard about cannibalization,” Roberts said. “Are there certain guests online whose on-property play eroded some? Yes. We know who they are and we can get those people back. It’s a huge boost to Mohegan in Connecticut and the opportunities are great in terms of economics.”

Roberts said the Mohegans’ approach was to make digital an extension of the property, the brand, and the rewards program; the point of digital is to get people back onto the property. The tribe has an arena, mall, and restaurants to fill, in addition to gaming.

“There’s always this fear from a land-based perspective,” Roberts said. “Seven states have igaming, but there’s still that fear of the unknown and at the same time a fear of missing out. It’s going to take some time. The bottom line is everybody has to evolve. The world has evolved.”

Roberts pointed out opportunities for the gaming industry, with 60 million people playing social-casino games every month, a multi-billion-dollar industry. Roughly 600,000 people in Connecticut spend three or four nights a week watching an unscripted TV show and spending money on something they could never win, he added.

“You’re not taking away from their time on property, but from something they’re already doing that you can compete with that enhances your property,” Roberts said.

As for sports betting, program moderator Brendan Bussmann, managing partner of B Global, said a lot of states that haven’t enacting it yet are tribal. Minnesota has the best prospects, while Oklahoma and California are next.

Iden said the map of possible sports-betting expansion shows that the majority “have some sort of tribal influence,” in which legislation hasn’t passed for one reason or another.

“Sometimes a lobbyist comes in and tries to tell state lawmakers what’s best,” Iden said. “That isn’t the right approach to take. We have to start with the listening piece. Trickier, when it comes to government affairs and what really influences, is that the wizardry behind it can’t happen unless at the end of the day the legislature is also listening as well. Oklahoma is a great example. The governor is trying to dictate what’s out there and that’s not working. We keep going back to the same plan and try and try again and it’s failing over and over again because it’s the wrong approach.”

Jonathan Edson, a senior vice president of business development at FanDuel, which works with the Mohegans, agreed that it’s important to listen to tribes on what will work for them. When FanDuel partnered with the Mohegans, they used the tribe’s brand for igaming, since it was more powerful in Connecticut, but used FanDuel when it came to sports betting, because it was more powerful for that purpose.