MI online gambling licensure begins

Michigan Starts Vetting Online Gambling Suppliers; Launch Timeline Still Uncertain

Regulators in Michigan are laying the foundation for the pending launch of online gambling in their state. Per a press release issued last Friday, the Michigan Gaming Control Board (MGCB) is now accepting license applications from the suppliers that will power their new industry.

“We’ve taken another step toward the launch of online gaming by beginning the licensing process,” said Executive Director Richard S. Kalm. “The MGCB encourages suppliers to file applications soon so we can conduct investigations and issue provisional licenses, which are allowed under state law.”

These suppliers will provide the payment processing, KYC, geolocation and other services that make regulated online gambling possible in Michigan. Such provisional licensure is not yet available for operators and primary platform providers expecting to serve the state.

Timeline to launch still unclear

While the decision represents a tangible step toward MI online gambling, it doesn’t signal an impending launch. The timeline ultimately depends on the drafting and publication of rules, a long process that only got underway earlier this year.

If anything, the task has become more slightly complicated in a couple ways — first by the governor’s refusal to allow the use of emergency rules for online gambling, then from the widespread shutdowns caused by the coronavirus.

Regulators do appear closer to finalizing a launch timeline, though. Here’s the official word from Kalm as quoted in the presser:

“We continue to make progress on rule promulgation for internet gaming and online sports betting. While we expect to launch these forms of betting by early 2021, we hope it can happen sooner.”

The MGCB initially projected the rule-making process would take more than a year to complete, setting a tentative target for early 2021. In a recent interview with PlayMI, however, Kalm indicated that an expedited launch is still in play for late 2020.

Who’s ready for MI online gambling?

Wednesday marks five months since Michigan Gov. Gretchen Whitmer signed into law the online gambling package that authorized sports betting alongside poker and casino games. New Jersey and Pennsylvania are the only other states that offer all three verticals online, and both are realizing substantial revenue.

There’s no reason that Michigan can’t find similar success when it ultimately joins them.

It has size working in its favor, for starters, with a population of 10 million making it slightly larger than New Jersey. It’s also a sporting state, with a passionate fan base across all four major sports plus multiple collegiate programs. Michigan is a gambling state too, and the new law puts its 20+ tribal and commercial casinos on equal footing in the digital realm.

Perhaps most importantly, policymakers have established an iGaming framework that is mostly kind to operators. The barriers to entry are modest for large gaming companies, while a reasonable tax rate should help foster competition in the longer term. MI sportsbooks might even be able to skirt the controversial official league data requirement if it proves to be a tangible burden.

Most major online gambling brands are therefore lining up to participate in the Michigan market, and state officials are no doubt feeling the pressure to get them live. From a financial standpoint, the ongoing closure of Detroit casinos only adds further urgency to the matter.

- Eric is a reporter and writer covering regulated US gambling, sports betting, and DFS. He comes from a poker background, formerly on staff at PokerNews and the World Poker Tour.
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