DraftKings CEO Jason Robins said in a recent interview that legalizing CA sports betting may not happen in the next state legislative cycle.
Robins said that to Joe Pompliano in a YouTube interview that aired earlier this month.
An online California sports betting ballot initiative failed miserably in 2022. And the fractured relationship between the commercial operators and the tribes requires significant mending.
It adds up to any compromise by 2024 being a massive longshot.
The DraftKings CEO sounded a frustrated tone about the money spent by California tribes opposing online California sportsbooks:
“The fact is, if someone wants to spend that much in opposition, it makes it tough. So until we figure out a way to work that out, I don’t think it’s a 2024 thing.”
“I think I’m talking long-term, when I think, eventually, it doesn’t matter what someone wants to spend. It’s just self-evident that this is something California should be doing.
“But that’s not in the next year or two, I think. There’s gotta be a deal worked out, or else we’re just going to be in a stalemate there for at least another cycle or two.”
Robins’s comments represent a turanaround of sorts from the previously held stance of commercial operators.
“We absolutely live to fight another day,” FanDuel CEO Amy Howe said in October at G2E in Las Vegas. “We believe there is a path to get there. Whether we get there in 2022, or, hopefully, we get there in 2024, we believe it is the right path.”
After that, Robins added:
“I think the more time people in California get exposed to the messages, and the more that they’re able to sift through what’s true and what’s not, I think you’ll see more momentum towards hopefully in 2024. Hopefully even in 2022, but more probably more likely in 2024 that this is getting passed.”
California tribes focused on unity during their recent all-tribes meeting, a tribal representative told LSR.
Even before Robins’s comments, tribal representatives were openly wondering whether the sportsbooks would take another shot at legalizing online sports betting in the Golden State.
“The reality may be that we beat them so badly in 2022 that they may not even pursue an effort in 2024,” tribal attorney Scott Crowell, who represents the Rincon Band of Luiseno Indians, said. “But if that happens, expect them to be back in 2026.”
Robins explained his frustration after Proposition 27 received just 18% of the vote in November 2022.. He also noted that it could ultimately change in the future as voter education increases, and more states legalize.
“It’s obviously very disappointing,” Robins said. “ … I have faith that as time goes on there will be a path. But I’d say as of now, there’s really just too much tribal opposition to imagine us getting anything done.
“I think some of the tribes, particularly the one that’s been in the most opposition, does want online gaming. I think there’s potentially a compromise to be done there, but we haven’t necessarily found it yet. That’s my hope, but I think it’s going to take a little time to play out. I don’t see this being a short-term thing. It’s the biggest prize, so not surprisingly it’s going to be the hardest battle.”
A tribal-led online sports betting initiative could be among options for the Golden State, assuming there is no legislative compromise in 2023.
Potentially enticing to the tribes, industry insiders opined, could be commercial sportsbook operators serving as tech providers in a B2B model where the tribes, operators and state would each receive a third of the cut.
“They have to understand that if they want a role going forward, they need to approach the tribes from the idea of how do we offer our experience and back-of-the-house skills to the tribes for tribally operated online sports betting,” Crowell said.
Robins noted it was “crazy” that Texas could legalize online sports betting before California:
“Texas is much more straightforward. Definitely still no slam dunk. There’s a lot to work though to get something done there. But there’s not this massive, deep-pocketed opposition that’s willing to spend hundreds of millions of dollars defeating a ballot campaign.
“The lesson learned is if anyone wants to drop that kind of spend, it doesn’t matter what the issue is, you could defeat any ballot initiative pretty much, at least for a period of time.”
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