When New Jersey introduced legalized sports gambling to the state, no one was too surprised at the amount of money that started to roll in. After all, in addition to having an established gambling market, the Garden State was fundamental in showing the U.S. Supreme Court in 2018 that federal lawmakers were wrong to have approved the sports wager-prohibiting PASPA. As New Jersey’s sportsbooks continued to gain traction, they began seeing record amounts of revenue. However, if one analysis of Colorado’s sports gambling potential is correct, New Jersey – and even Nevada – could be about to face some seriously stiff competition.
Colorado residents approved sports gambling in the state with the passage of Proposition DD last November. The official launch of the activity was scheduled for this May, and, so far, there have not been any plans to delay the launch. Colorado’s Limited Gaming Control Commission (LGCC), which is providing oversight of the activity, has been busy issuing licenses to everyone it deems worthy as everyone prepares for next month to arrive.
With a robust market and a great deal of anticipated interest, PlayColorado expects great things to come out of sports gambling. It released a statement this week in which it predicts a handle of as much as $6 billion a year, with $40 million of that going to the state in the form of tax revenue. Another $400 million will be kept by the operators for expenses and income.
Dustin Gouker, chief analyst for PlayColorado.com, asserts, “With a significant base of existing land-based casinos, a regulatory framework that will be attractive to operators, and one of the largest metropolitan markets in the country to draw from, Colorado is well-positioned to capitalize on sports betting. But assuming the industry does launch on May 1, it will be doing so in unprecedented circumstances with almost no sports to wager on. There are some advantages to a forced soft opening, but it also means that it will be some time before we learn with confidence just how Colorado’s bettors will respond to legal sports betting.”
The coronavirus hasn’t been kind to anyone, and the global sports industry has been hit extremely hard. Currently, there is almost no major sporting event taking place, which means sportsbooks have had to get creative with their offerings just to try to keep their heads above water. The latest rumors are that most sports leagues, including the NBA and MLB, may not be able to launch until June, at the earliest, which means Colorado’s new sports gambling industry will have to wait a little longer before they can start recuperating their investments.
Gouker adds, “Colorado legislators and regulators have made many smart, measured decisions based on input from casinos, operators, and bettors, and that has led to the adoption of an excellent collection of rules and restrictions. They have also had the undeniable benefit of seeing what has worked in other states. Colorado’s methodical approach might have been frustrating to bettors by slowing the launch, but there is plenty to be encouraged about. Sports betting operators have inked partnerships and regulators are listening to stakeholders. That will serve Colorado well.”
If PlayColorado’s projections are correct, Colorado is looking at a market that could rival what is found in Nevada and New Jersey. New Jersey’s sports gambling handle last year was $4.6 billion, while Nevada’s handle for the action was $5.3 billion. However, both of these states still have an edge, as their sportsbooks have a head start on Colorado.
