New York to Give Green Light to Online Betting Software Companies Soon

New York is expected to announce their selection of online betting software companies soon. These companies will be allowed to offer online sports betting, with the launch set to be just in time for the Super Bowl. The New York Gaming Commission is still on schedule based on their timeline to start approving online sportsbook operators this November.

The state expects that the use of betting software for sportsbooks by New Yorkers will generate $10 billion in wagers next year. They are also forecasting a $1 billion profit margin for the betting market- 51% of which goes to the state. The high cut that the state will be collecting from sportsbook operators are very steep. New Hampshire the only other state to charge 15% tax on the handle. Even powerhouse betting markets such as New Jersey only share 13% of their profits to the state.

What the Steep Tax Means for Online Betting Software Companies

Much like any bookie pay per head operation, the goal is to generate as much profit as possible. Given how steep the tax is, operators may have to cut corners on their online sportsbooks. One of the possible effects is to see worse odds in New York online sportsbooks. This can be done to make the lines more favorable for operators to earn. Given this scenario, it may be likely that New Yorkers would still travel to other states to be able to place their bets. And this is something they are quite used to doing now. Currently, New Yorkers tend to travel to New Jersey, Philadelphia, and now Connecticut, to be able to place their wagers online, thereby boosting the local betting markets of these states.

Another possible impact for an online sportsbook in New York, would be the lack of promotions and bonuses. Offering bonuses is a key strategy that many online sportsbooks use. This is mainly done to generate registration and encourage their players to bet more. But since the tax is so high, they may go away with any promotions to try to save more money on their end. Maybe an operator will be brave enough to offer welcome bonuses and the like. However, the offer will not be as generous and attractive as what you will find elsewhere. Especially in nearby sportsbooks in New Jersey, or Connecticut.

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