The first full month of legal sports betting is in the books for the state of Tennessee. The 19th state to welcome such a platform started and finished strong in November, a month that had an unusually small betting menu for this time of the year. It just so happens that the sports running during November provided the recipe for some record-numbers for Tennessee.
Many looked at Tennessee’s sports betting regulations with concern. The unusually high 10% hold-rate was viewed with some skepticism, the country’s first and only mobile-only platform had initially raised a few red flags and the 20% tax rate was deemed unfriendly to potential service providers for the state.
But after the Tennessee Education Lottery, which oversees the licensing and regulation of online sports wagering in the state, released its figures Wednesday, all of the concerns went out the window and optimism about legal sports betting in Tennessee reigned supreme.
It doesn’t come as much of a shock that the Tennessee legal sports betting industry exceeded expectations in Month 1. We got a good hint after its first week of operation when the four service providers took in just over $27.4 million in total handle. Day 1, which happened to coincide with Sunday NFL action brought in $5.1 million alone.
That momentum continued and for the month, Tennessee’s November handle came in at $131,444,523. The previous record for a first-full month of operation belonged to Indiana and they generated $35.3 million in September, 2019. Revenues reported by the Tennessee Education Lottery were $13.2 million and the tax contribution to state and local coffers was an impressive $2,363,918.
“Talk about getting the market off on the right foot,” noted Jessica Welman, analyst for PlayTenn.com. “Tennessee is a market with enormous potential but untested, making it difficult to predict how bettors would react to start. By topping the next-best debut by nearly $100m, I’d say that verdict is now in and it is a good one.”
Right Sports at the Right Time
It certainly didn’t hurt the betting scene that the beloved Tennessee Titans are in the midst of a best-ever campaign and that its fan-base is as revved up as they ever have been. Football, including college is king in the state of Tennessee.
“The best-ever launch for online sports betting is perhaps a surprise to some, but Tennessee also debuted with enormously favorable circumstances, many of which came by design,” said Dustin Gouker, analyst for PlayTenn.com.
“First, it debuted in the heart of the NFL and college football seasons in a region that is particularly football crazy. And with the top operators in the country jumping in early to take advantage of the football season in full swing, it was a debut month like no other.”
Mooching off the Neighbors
The state of Tennessee happens to be one of the only jurisdictions in the area with a legal sports betting platform. The Tennessee scene was likely given a boost by bettors from neighboring states. The fact that Tennessee is a mobile-only platform only boosts Tennessee’s profile in the area.
Arkansas and Mississippi haven’t come close to launching their own platform as of yet and Virginia, which will go live in January will likely take some time to catch up, meaning that The Volunteer State will likely continue to benefit from cross-border gamblers for the time-being.
Looking back, November’s numbers were impressive, especially considering the fact that Tennessee is home to just 7 million residents. The figures are also eyebrow-raising considering the fact that just four operators were live during the month – BetMGM, the two DFS behemoths and local outfit Action 24/7.
Caution has been urged by those close to the industry. “Our first month of sports wagering in Tennessee comes at a unique time in the world, let alone the sports world,” Rebecca Paul Hargrove, TEL President and CEO, said in a news release. “November’s figures include adjustments and indicate potential. It is only one month in an unpredictable and extraordinary year, making it difficult to begin extrapolating out from this single month. As this new industry in Tennessee evolves, we will continue to work with licensees and registrants in support of a responsible and competitive sports wagering program.”
But, with next-to-no competition in the area other than Virginia impending, with at least three new operators expected to come online in the next few months including BetAmerica, WynnBet, and William Hill, and with the Memphis Grizzlies and Nashville Predators commencing their seasons, it is hard not to be excited about the Tennessee scene.
Tennessee has officially set a new standard with which new legal betting states will have to work hard to best. A few states will get their chance early in 2021. Stay tuned to see if they can touch Tennessee’s accomplishments.