Indiana is set to become the next state to commence sports betting with the Indiana Gaming Commission aiming for a September 1st launch of retail sportsbooks at local casinos.
Mobile betting will move a little slower, but casinos are also taking action on that front and some may be ready by the end of October.
New opportunities are coming online for US gambling affiliates, and at least one Indiana operator has confirmed its intention to accept affiliates who will be able to refer customers in return for commission payments. We expect most operators will eventually launch affiliate programs in Indiana as well.
Now, BettingUSA.com has learned more about how the Indiana sports betting affiliate model will work. Regulations from the Indiana Gaming Commission (IGC) and information provided directly by one operator has shed some light on how it will work and what it will take for affiliates to promote licensed betting sites.
Indiana Will Require Affiliates to be Licensed
Last month, the IGC published a draft version of the emergency rules that will be used to regulate sports betting until the Commission is able to formally approve permanent rules.
Note that these are only draft rules and they will not be approved until the next IGC meeting on August 28th, but we expect no major changes between now and then.
The portion of the emergency regulations dealing with affiliates is short but provides us with a picture of what to expect when sports betting goes live in Indiana.
From the emergency regulations:
(b) Affiliates that provide marketing or other services meant to promote sport wagering websites shall register with the commission pursuant to this SECTION.
(c) After a determination made by the executive director or executive director’s designee, an entity or individual must complete and submit the appropriate forms prescribed by the commission.
(d) A registration shall not be considered by the commission unless a sports wagering operator:
- provides a letter of intent to use the goods or services of the registrant; and
- provides evidence of conducting due diligence regarding the:
- criminal history;
- character; and
of the sports wagering registrant.
Based on this, it appears affiliates will need to have an existing relationship with at least one operator prior to applying for an Indiana license. Note that the above rules state the sports wagering operator must provide the Commission with a letter of intent to work with the affiliate.
Two Forms and a $500 Sports Betting Affiliate Licensing Fee
BettingUSA.com spoke with one operator that plans to launch an affiliate program in Indiana soon and learned a little more about the process.
We should make an important before continuing. Mainly, that is remember the following is based on information provided to BettingUSA from a third party – not directly from the state of Indiana. Operators are also learning as they go, so information they provide should not be considered set in stone.
The operator has told us that prospective affiliates need to fill out this form at the IGC website:
The operator has also told us the IGC will then send the affiliate a “one-page vendor registration form” to fill out and return to the IGC along with a one-time $500 fee.
Revenue Share Vs. CPA Licensing Requirements
For a little background info, New Jersey and Pennsylvania both have a simpler licensing process for affiliates who promote on a cost-per-acquisition (CPA) and a more involved process for those who promote on a revenue sharing (rev share) basis.
An Indiana Gaming Commission representative at the EGR North American Midwest Briefing last month told attendees that affiliates who operate on a revenue share basis will be subject to a more demanding licensing process.
Details on the licensing process are still limited as a whole, but the most important things we can confirm are that operators will be accepting affiliates and there will be a licensing requirement. We will update this post as more details become known.
New Jersey and Pennsylvania May Provide Preview of the Indiana Licensing Process
While we wait for more information from the IGC, we can consider the affiliate licensing process in place in New Jersey and Pennsylvania for an idea of the directions Indiana could take as it relates to affiliates.
Both states have established a two-tier system in which affiliates can apply for a simpler, cheaper license to promote on a CPA basis or for a more complicated license to promote on a revenue share basis.
Under the CPA model, affiliates are paid a flat fee for each new depositing customer they refer to sports betting and gambling sites.
Under the rev share model, the affiliate is actually sharing in the revenue generated by players and is more closely evaluated for suitability. The process for gaining a rev share license in both states is not only more complicated but also more expensive.
New Jersey regulations require affiliates who wish to promote casinos and sportsbooks on a CPA basis to acquire a Vendor Registration Number from the NJ Division of Gaming Enforcement (NJDGE). The application for a vendor number is free, but a licensed operator must submit the application on behalf of the affiliate.
Typically, the process for affiliates is to contact a licensed gambling site to apply as an affiliate. If the casino accepts the affiliate’s request, the casino will submit the application to get the affiliate properly licensed to promote on a CPA basis.
For example, Caesars Online has an affiliates page on its website here that prospective affiliates can use to submit an application with Caesars. The operator will also provide the affiliate a Vendor Registration Form that asks for basic information such as the affiliate’s name, address and so on.
Becoming a licensed CPA affiliate is fairly painless in New Jersey. Where things get complicated is in becoming a licensed rev-share affiliate. This requires an Ancillary CSIE license and comes with a $2,000 fee paid straight to the NJDGE. In addition to being more expensive, the NJ rev share license application is much more intensive.
The Pennsylvania licensing model resembles that of New Jersey’s for the most part with two licensing tiers based on the chosen commission model.
Affiliates wishing to promote on a CPA basis in Pennsylvania must fill out this lengthy Gaming Service Registration Application form (here) and pay a $500 application fee, $60 for each qualifier (key employees) and $60 for each affiliated entity.
If approved, the affiliate will be required to pay a $2,500 registration fee for a five-year license. The license can be renewed every five years for an additional $2,500.
Applying to become a revenue share affiliate in Pennsylvania is significantly more intensive and expensive. In addition to filling out multiple in-depth forms, rev share affiliates are asked to pay a $2,500 application fee, $1,000 for each individual qualifier and $500 for any holding companies held by the applicant. If approved, the affiliate will have to pay a $5,000 certification fee, renewable every five years.
How NJ and PA Relate to Indiana
Like Pennsylvania and New Jersey, Indiana has an established casino industry and seems to be fitting affiliates into the state’s existing licensing framework.
Additionally, comments from the IGC representative last month combined with information provided to BettingUSA by an operator, Indiana will be following suit in establishing two licensing tiers for affiliates.
The nuts and bolts of affiliate licensing in Indiana have yet to be revealed, but we can take what we’ve seen from NJ and PA to take a stab at how licensing will work in Indiana. Now, it is just a matter of time as the various operators get up and running, engage with affiliates and iron out the details.