As FanDuel hosted a presentation to highlight its strong performance in U.S. sports betting, one of its top executives addressed areas that have not gone as well as the company may have hoped, including online casino expansion and the failure of a sports-betting initiative in California.
FanDuel hosted a “Capital Markets Day” presentation Wednesday (November 16) to highlight its success in the sports-betting field, claiming a 43 percent national market share in U.S. sports betting, by far the market leader.
But recently, the company was among the coalition that drew headlines for its unpopularity in California, where the referendum sponsored by national sports-betting operators was soundly defeated, earning just 17 percent of favorable votes according to the California Secretary of State’s totals Wednesday night, one of the least popular ballot measures in the state’s history.
While highlighting the company’s potential growth and projection that 80 percent of the population would have access to legalized mobile betting by 2030, FanDuel president Christian Genetski acknowledged the elephant in the room of the most populous U.S. state rejecting sports betting so soundly.
“I've talked about how we've had states be ahead of schedule and stay behind schedule, in the case of California, 2022 would have been by anyone's measure audaciously ahead of schedule,” Genetski said.
“If you'd asked me 18 months ago, I would have said there was virtually no chance we would even be thinking about putting sports betting on the ballot,” he continued. “We got some momentum in the industry, we had a lot of fundraising in the industry and commitment to give it a go, and so we thought we should.”
Genetski said the company thought it would “learn a lot along the way” and thought it was important to give voters an alternative to the tribal-backed retail-only initiative, which also failed, earning only 32 percent of the vote.
“I don't want to go into too much detail about all the conversations we had along the way, but suffice to say it was not always a fait accompli that the large tribal casinos in California were going to oppose mobile sports betting,” he said. “As it turned out, ultimately, I think they weren't ready for it in 2022, and they did oppose it and they did so at the cost of their own retail sports betting measure.”
Genetski said that despite the failure, all stakeholders agree that as sports-betting legalization continues to increase throughout the country, “California is not going to be an outlier”.
He also highlighted several reasons for optimism for online casino expansion, which has been far slower than sports-betting expansion and almost glacial in the last few years, with only one state, Connecticut, enacting igaming legislation since the beginning of the coronavirus pandemic in March 2020, an event that some in the industry thought would spur online gaming growth.
“We've been in a situation the last four years where state budgets have been fairly flush, and so in those times, the states aren't always out looking for new sources of revenue,” Genetski said. “But in a time of economic downturn, when state budgets become pinched, they'll be looking for sources of revenue other than raising taxes on their own citizens and igaming is incredibly well positioned when that day comes.”
In addition, he said that internal disputes among gaming stakeholders over online casino have lessened in recent years.
“Another significant point, and something that's changed over the course of the last two years, is that we now have near unanimity in the land-based casino community that iGaming is a net positive, so we now have a coalition that involves both the pure-play online operators and the land-based casinos working together to push for igaming.”
“As a result, we see real momentum, and if you think about the states that are ripe for igaming — think states that have land based casinos that have had them a while and have also passed mobile sports betting so they're getting acclimated to online gaming.”
Genetski highlighted Illinois, Indiana, Iowa, New York, Massachusetts, Maryland, Ohio and Louisiana as examples.