Posted on: December 1, 2023, 04:57h.
Last updated on: December 1, 2023, 04:57h.
The Connecticut Lottery Corporation (CLC) has picked Fanatics Betting and Gaming to be its next sports betting partner.
The CLC received numerous bids for its sports betting partnership, and after careful consideration, the offering from Fanatics was chosen as the most attractive option.
Fanatics is the only true sports brand in the gaming space and has established itself as an innovator in the industry,” said Greg Smith, CLC president and CEO. “We have been impressed with the Fanatics team, their aggressive entry into the US sports betting market, and we are excited to see how they redefine the sports betting customer experience here in Connecticut.”
Connecticut legalized sports betting in March 2021 as part of a gaming expansion package. The Mohegan Tribe and Mashantucket Pequot Tribal Nation were granted iGaming and both retail and online sports betting privileges.
In exchange for the expanded gaming, the tribes conceded control of their gaming monopoly to allow the Connecticut Lottery to partner with a third-party sportsbook operator to conduct in-person and online sports gambling.
Rush Street Exit
In 2021, the CLC held its first competitive bidding round for sports betting. Several firms vied for market entry and share, and Rush Street Interactive won the competition over 15 other bidders by offering a guaranteed minimum revenue share of $170 million for the 10-year partnership.
Rush’s assurance suggested it would win a minimum of $1.23 billion during the life of the contract. However, the company fell short of its projections, generating much less than anticipated revenue, and eventually decided to sever its partnership with the Connecticut Lottery.
Sports betting went live in Connecticut in October 2021. The tribes’ partners quickly claimed the majority of the market share, leaving little for Rush’s SugarHouse Sportsbook.
Between December 2022 and October 2023, the SugarHouse Sportsbook only generated $9.17 million in online sports betting revenue, while the Connecticut Lottery’s retail locations added $11.6 million in gross revenue.
In April, Rush announced that it was severing its sports betting partnership with the Connecticut Lottery. A separation cost was not disclosed.
Rush isn’t the only firm to overestimate sports betting revenue. Several others have realized how challenging the sports betting industry can be. However, Fanatics remains bullish on sports gambling and is on a market entry spree.
The company entered Virginia earlier this month — its seventh state along with Kentucky, Maryland, Massachusetts, Ohio, Tennessee, and West Virginia. Connecticut Lottery was apparently won over during their pitch, and Fanatics is excited about the new partnership.
Fanatics will also run the self-service kiosks at the CLC’s 10 retail sportsbook locations, along with the online sportsbook. The lottery’s retail sportsbook business is highlighted by the recently opened XL Center Sports Bar & Sportsbook in Hartford.