NY Sports Betting Regulator shows what a platform provider and operator really is

The New York State Gaming Commission It made it clear how mobile sports betting will perform in New York, although a few questions remain.

NYSGC answered selected industry questions after New York sports betting is finally mobile. The answers are definitely helpful, but don’t go into all of the necessary details. This means that some of the confusion about legislative language will continue for now.

The problem with the proposed New York mobile betting model is that no one really understands it. Governor Andrew Cuomo stuck to his plan and pushed his model through what asked at least two Platform providers and four Operator.

Hopeful participants and bettors who want to know more are waiting for them Call for proposals for all the details to drop. That will happen through July 1 no later than. The first draft of the mobile betting rules is expected on the same day as the RFP.

Answering major questions about mobile sports betting in New York

The biggest question so far is what exactly a platform provider and operator will do and what their relationship needs to include.

The NYSGC gave the clearest answer yet about the necessary relationship:

“The operators must use the platform to accept and process bets. The use of technology beyond the required processing of betting transactions is at the discretion of a platform provider. “

Another question dealt in more detail with the question of whether operators under the same platform provider can use different technologies:

“Yes, the required use of a platform is limited to the functions that are required to accept and process an application. Further use is subject to an agreement between a platform provider and an operator. “

How could that work

In essence, a sports betting operator could be working with someone who does not provide all of the technology as long as the sports betting operator is relaying its bets through the platform operator. What exactly that would look like will probably be described in more detail in the RFP.

The commission stepped back one more step and defined what a platform provider itself is:

The operators (skins) face the consumer. One platform is the back-of-house system that accepts and records transactions initiated through the skin applications.

Mobile NY sports betting tax payments murky

The commission has not fully clarified how New York State will get its money. Remember: Cuomo’s office expects more than $ 500 million in annual sports betting revenue within three years.

The tax rate – a minimum of 50%as dictated by Cuomo – paid by platform providers. The winning bid with the highest suggested rate sets the bar. Other vendors with a winning bid must adjust their bid to include the higher rate for winning a license.

However, there is no guarantee that platform providers will receive such a rate from their partners:

“The distribution of internal revenue is subject to an agreement between a platform provider and an operator.”

The proposed economics don’t sound great for anyone but New York State to take advantage of mobile betting.

More operators according to RFP?

One of the biggest worries for Rep. Gary Pretlow During the negotiations, a sports betting market was stuck in New York that is not generating the best possible revenue for the state. He wanted a review period, but that didn’t make the final calculation.

Based on how the regulator reads the bill, this RFP is your only chance to get into New York.

According to the Commission’s interpretation of the law, it is not possible to add future operators in the course of market readiness.

Original partnerships confirmed as pointless

So much for four Sports betting negotiating first-skin access in New York.

Bet365, BetRivers, DraftKings Sports Betting and FanDuel Sports Betting All of them have first-skin deals with one of the four commercial casinos in New York. The model proposed by Cuomo initially made it sound like it was important. Now it is clear that these deals are worthless:

“Contracts between commercial casinos and operators of their internal sports betting are of no relevance to RFA. The RFA is open to all qualified platform providers and operators, and the applicants with the highest score will be recognized. “

Additional points for tribal involvement, not skin

The system for evaluating the RFP is still unknown and will remain so until the RFP is published, the commission said. The only point known about scoring is a platform provider that works with one of the state’s three tribal game operators and earns extra points.

However, that doesn’t mean the tribal operator needs a skin:

Q: Does an Native American nation operator partner or operator simply have to enter into an income-sharing agreement with a nation to earn additional points?

A: An operator who has a revenue sharing agreement with compressed nations or tribes will receive an additional point consideration when their bid is evaluated.

Concerns about the Oneida IndiansThe exclusivity zones likely resulted in tribal inclusion getting more points. However, the document makes clear the state’s interpretation that sports betting cannot take place in tribal areas or within those exclusivity zones. A legal challenge in this matter remains possible.

More important details about mobile sports betting in New York

A few other questions were answered or cleared up to help explain New York mobile sports betting:

  • Platform providers cannot choose where their servers are kept – that decision is made by the Commission. All four commercial casinos will get and get servers $ 5 million annually no matter what. How many platform providers are chosen determines how these payments are made.
  • Platform vendors can band together for bids, but both would be for a $ 25 million License fee.
  • The minimum is two platform providers, but it is unlikely that this will be the case: “After considering all the proposals, the Commission will determine the optimal number of licenses to be granted in order to maximize revenue for the state.”
  • A company can apply as a platform provider in one offer and as an operator in another. Should one of these bids win, the other bid would have to be reevaluated without this company.
  • Free play and actions can not deducted from sports betting income to reduce the tax burden.
  • If the offer of a platform provider comprises several operators, these operators do not have to start all at the same time. However, the bid must include a schedule for the launches.
  • Preference for official league dates is described in detail in the regulations. The regulations also specify whether cash can be deposited in retail stores.

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