DraftKings is headed to Illinois. The sports gaming giant has struck a partnership with the Casino Queen property in East St. Louis, according to a June SEC filing. We don’t know when it will launch yet, but DraftKings figures to be a major player in the Illinois sports betting market.
“We look forward to working with both the Illinois Gaming Board and Casino Queen to bring our legal sports betting product to Illinois,” DraftKings confirmed in a statement.
The market access deal is between 5-10 years long, per the SEC filing. And thanks to Illinois Gov. J.B. Pritzker’s executive order allowing customers to sign up from home, DraftKings has a major incentive to launch its product as soon as possible.
Casino Queen, along with six other Illinois casinos, is approved for a four-year sports betting master license. Here are the others:
- Argosy Casino Alton
- Grand Victoria Casino
- Hollywood Casino Aurora
- Hollywood Casino Joliet
- Rivers Casino-Des Plaines
- Par-A-Dice Hotel Casino
Avoiding “the penalty box”
The partnership allows DraftKings to work around an Illinois gambling law designed to give brick-and-mortar casinos a head start. Had it only applied for an online license (which costs $20 million), DraftKings would have had to wait 18 months for approval. The law appears to be targeted at DraftKings and FanDuel, and DraftKings CEO Jason Robins aired his grievances about the matter on Twitter last June:
While it is good to see sports betting bills passed, excluding DraftKings and FanDuel is like passing a ride sharing bill that excludes Uber and Lyft. Very disappointing that Illinois customers will not have the best options available to them for 18 months.
— Jason Robins (@JasonDRobins) June 2, 2019
The workaround allows DraftKings to enter the Illinois market earlier, but it will have to pay an undisclosed percentage of net revenue to Casino Queen. Branding rules also state that Casino Queen will need to be featured on DraftKings’ site and app. So, we are likely to see something to the effect of “DraftKings Casino Queen Sportsbook” or “Casino Queen Sportsbook powered by DraftKings.”
As of now, BetRivers is the only online betting platform live in Illinois. BetMGM could also be coming up soon. While FanDuel has yet to strike an Illinois access deal, it seems likely that it will at some point. That said, DraftKings appears to be on track to beat FanDuel to market in Illinois, a big win for the former.
DraftKings is currently accepting bets in seven states. Illinois is the sixth-most populous state in the US, just a hair behind Pennsylvania, and the third-most populous state to legalize sports betting. So it’s a coveted market among the key players.
Eilers & Krejcik Gaming projects that Illinois could eventually rake in $1 billion in annual sports betting revenue.
DraftKings “is going through the regulatory testing process over the next couple of weeks and hopes to launch online shortly after,” according to our sister site Legal Sports Report.
It would be in DraftKings’ best interest to launch as soon as possible in Illinois with the scheduled return of MLB, the NBA, and the NHL (among others) in late July. It may be in Illinois bettors’ best interest to register from home as soon as possible, as we don’t know how long Pritzker’s remote sign-up rules will remain in effect.
DraftKings’ stock price has spiked since going public, despite the lack of sports. It will be fascinating to see where it goes if the leagues return as planned, and what kind of market share it carves out in Illinois.