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March 15, 2019

DraftKings angling for piece of pro sports betting

Photo | SHNS DraftKings public affairs director James Chisholm.

With legislation to legalize and regulate sports betting on the horizon in Massachusetts, representatives from a Boston-based mobile sports wagering service visited the State House on Thursday to remind a key House lawmaker of what they said are the benefits of mobile betting.

With the gift of a football helmet decorated with stickers bearing the names and hometowns of Massachusetts residents who signed a petition calling for the ability to place bets on sporting events online or through a mobile app in tow, DraftKings official James Chisholm stopped by Rep. Ann-Margaret Ferrante's office to keep mobile betting on the Economic Development and Emerging Technologies Committee chairwoman's front burner.

 "Sports betting exists in Massachusetts," he said, "it just doesn't exist legally."

Chisholm said DraftKings is not getting behind any one particular bill that would legalize sports betting -- Gov. Charlie Baker has filed one, as have a handful of lawmakers -- but instead is advocating the benefits of allowing wagers via smartphone apps rather than exclusively at specific facilities.

By authorizing mobile betting, the state would entice more bettors to place their wagers through the regulated system rather than an illicit source because it would be just as convenient and would provide various consumer protections, Chisholm said.

It would also help the state maximize revenue from sports betting, he said. The governor's bill, which would allow the state's casinos and online-only operators like DraftKings or FanDuel to take bets on professional games, would earmark the estimated $35 million in new revenue in fiscal 2020 for local aid.

In New Jersey, where DraftKings launched as the first mobile betting platform in August, 69 percent of the money wagered between August and February was wagered via a mobile platform, DraftKings said.

In February alone, 81 percent of the $320 million put on the line was wagered online while the state's 10 physical betting locations accounted for 19 percent of the monthly handle.

Chisholm said mobile betting also allows operators and regulators to more closely track betting trends and to identify suspected fraud. If a bettor typically places $10 bets and suddenly deposits $10,000 into their account, he said, DraftKings would flag that transaction for closer inspection. Mobile betting also allows people to set their own limits on how much they can bet, how much they can deposit into their account at any one time and how long they can spend on the DraftKings website or app.

Eight states, including neighboring Rhode Island, currently have legal sports betting, while bills have either passed or been introduced in dozens of other states, according to ESPN. When the U.S. Supreme Court opened the door last year for states to pursue sports betting, Massachusetts legislative leaders expressed an interest in legalizing sports betting early this session.

When Ferrante, a Gloucester Democrat, was named House chair of the Committee on Economic Development and Emerging Technologies last month, Speaker Robert DeLeo said that under Ferrante economic development is "going to be a major issue in terms of sports betting and the like."

With the Legislature still getting into gear for the new session, the timeline for consideration of a sports betting bill is unclear. But Chisholm said DraftKings is hoping legislators pass a bill into law before the NFL kicks off in September. 

"It benefits all stakeholders if there is legal, regulated, mobile sports betting in Massachusetts by the start of the football season," he said, acknowledging that it would require the Legislature to pass a bill into law and let the regulating authority draft the rules for sports betting "fairly quickly." 

The NFL season is when the greatest number of people seek to place bets and when the most money is wagered, Chisholm said. He said that money will be wagered one way or another, whether it is through a legal and regulated means or via the illicit market.

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