Online Sportsbooks with In-Person Registration Feel Handle Pinch

Global event cancelations due to the coronavirus outbreak have eliminated nearly every betting option for sportsbooks. In states with in-person registration requirements, those restrictions mean new bettors have virtually no options for legal betting.

With practically every American casino closed, states that require physical signups before betting online have effectively shut out new players. With nationwide casino closures expected to last for weeks or even months, this means would-be registrants won’t be able to bet on futures, as well as the handful of betting options still operating, such as eSports.

Passed by lawmakers in a handful of states as a means to boost foot traffic at brick-and-mortar casinos, these in-person registration requirements have handicapped the revenue potential for online sports betting as customers eschew the trip to the casino and remain with offshore sites or unlicensed bookmakers.

The coronavirus outbreak presents a new downside to these restrictions to online sports betting, which typically makes up the bulk of handle in states with mobile wagering.

Iowa Casinos Close Digital Doors

In Iowa, this has stopped the newest online sportsbooks- and may delay others from launching entirely.

Iowa sports bettors will not be able to register in person at any of the three Wild Rose casinos, which launched their DraftKings online sportsbook last month. When all casinos were ordered to close in March, new players were no longer able to sign up with DraftKings Sportsbook, one of the nation’s highest-grossing sports betting brands or any of the state’s other sportsbooks.

The in-person registration requirement is a part of Iowa sports betting law. Unlike a regulatory measure, which could be adjusted by state gaming officials, the registration restriction faces a higher threshold for amendment.

That clause sunsets on Jan. 1, 2021, but until then, new would-be legal Iowa sports bettors will have to wait until whenever brick-and-mortar facilities are able to re-open their doors.

This has also delayed at least a pair of planned digital and retail sportsbooks openings. The Sioux City Journal reports WinnaVegas Casino & Resort and Blackbird Bend Casino were hoping for an autumn launch of their sports betting platforms. Coronavirus has altered the timeline for retail sports betting and the in-person registration requirement has, by default, forced the two facilities to reconsider their online offerings as well.

Other States Struggle

Rhode Island, which has only one legal online sports betting site and only two brick-and-mortar casinos, had struggled to garner customers even before the outbreak. Less than half of mobile sportsbook applicants completed the in-person registration requirement, realistically slicing off more than 50% of its possible revenue. In contrast, nearby New Hampshire, without the registration mandate, quickly eclipsed Rhode Island in signups and total wagers.

In Illinois, hopes for online sports betting essentially ceased days after retail betting began. Nearly 9 months after it passed its sports betting legalization bill, the first retail sportsbooks in Illinois opened in anticipation of the 2020 NCAA Men’s Basketball tournament, some of the most lucrative weeks of the sports gambling calendar.

Instead, March Madness was canceled and all state casinos closed. With an in-person registration requirement, bettors won’t be able to register for online sportsbooks even if they are able to launch during social distancing measures, denying them access to whatever limited mobile betting options may be available.

The other state with an in-person registration requirement, Nevada, has far and away the most casinos per capita of any state, makes signups easier than anywhere else in the country. It is still likely leaving millions on the table. The 14 states taking bets at the start of 2020 have eclipsed $10 billion in wagers over the past 12 months. That figure still pales in comparison to the estimated $150 billion gambled illegally each year, which still includes customers who still bet offshore or with bookies in states with legal betting.

Since Illinois, Iowa and Rhode Island approved online sports betting in 2019, no state legislature to pass a sports wagering bill has included in-person registration provisions. The forced social distancing measures from COVID-19 are another reason lawmakers in the future should seek to avoid them.