Michigan legalizes sports betting — the state could generate $8 billion a year in sports bets, according to one analyst

Michigan legalizes sports betting — the state could generate $8 billion a year in sports bets, according to one analyst

On Friday, Michigan will become the 15th state to accept legal online wagers on sports after getting authorization from the Michigan Gaming Control Board.

“Michigan residents love sports and, judging by inquiries we’ve received, eagerly anticipate using mobile devices to place bets through the commercial and tribal casinos,” executive director of the gaming board Richard S. Kalm said in a statement. “Online gaming and sports betting will provide the casinos with new ways to engage with customers while the state and local communities will benefit from taxes and payments on wagering revenue,” he added.

Michigan passed legislation in 2020 to legalize sports betting, and will begin online betting today as several casino operators are set to begin taking bets at noon.

Many of the online casino operators debuting in Michigan are major brands in the sports betting industry like DraftKings
William Hill
Barstool Sports

and FanDuel.

Online sports betting is a gamechanger for betting revenues. In-person-only sports bets are only a small fraction compared with online betting in most states. For example, in New Jersey, which frequently has the most money wagered on sports of any state in the U.S., about 90% of all bets are made online, according to public data.

How popular could sports betting in Michigan be? Betting analyst Dustin Gouker estimates the state could generate $8 billion in sports bets annually and $500 million in gross operator revenue.

“Michigan is the second-largest state in terms of population to have legalized online sports betting and online casinos and poker, behind only Pennsylvania,” said Gouker. “Michigan’s business-friendly tax rate and competitive licensing fees will attract operators, too. And with a solid tribal and commercial casino infrastructure already in place, Michigan should be poised for quick success.”

If such estimates come to fruition, those amounts could generate as much as $40 million annually for the state of Michigan, according to Gouker.

Many states are mulling legalizing sports betting as a revenue generator, especially during the COVID-19 pandemic where state budgets have become thin. Even New York Gov. Andrew Cuomo, who had long pushed back against the idea of legalizing online sports betting, has been persuaded by events surrounding the COVID-19 pandemic.

Before placing any wagers, it’s important to look up betting rules in your state, as each state that has legalized online betting has its own set of oftentimes quirky rules. For example, sports betting is legal in New York, but only at four retail casinos in upstate New York. In Virginia, there is a bill that restricts bets on hometown college teams, and in Mississippi you can bet online, but only when inside a casino.

The federal government gave states legislative power to legalize sports gambling when the Supreme Court ruled the ban in sports betting was unconstitutional in 2018.

Twenty states in addition to Washington, D.C. currently offer sports betting, according to the American Gaming Association. A few more states have legalized betting, but are not currently accepting wagers.

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