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It’s been a long wait for Michigan residents eager to gamble online. However, they may only need to remain patient for another few weeks, at least according to one legislator.
Sen. Pete Lucido, a Republican, is the chair of the Joint Committee on Administrative Rules (JCAR). This committee is only one cog in the legislative-regulatory machine, but it’s an important one at this juncture.
Sen. Lucido says that tomorrow — Tuesday, Dec. 1 — JCAR will waive the remaining time it has available to review the final draft of Michigan’s iGaming rules. This will complete the legislative portion of the road to launch. The path will then be clear for the Michigan Gaming Control Board (MGCB) to begin issuing licenses and set a launch date. Lucido feels that date could come before the year is out.
“Everybody wants to get this thing going,” Sen. Lucido told The Associated Press. “This is something that’s long overdue at this point.”
Michigan gamblers will no doubt agree. This spring, during the nationwide casino shutdown, they could only watch as Pennsylvania online casinos filled the void for their southern neighbors. Now, the three Detroit commercial casinos have been shut down once again on the orders of Gov. Gretchen Whitmer, and roughly half the tribal casinos in the Upper Peninsula have followed suit of their own accord.
A second casino shutdown in the fall was always a strong possibility, and MGCB and the Michigan legislature were keenly aware of this. Michigan online casino wasn’t originally expected to launch until early 2021. Over the summer, attempts began to accelerate that timeline.
One senator even introduced a bill to allow operators to launch without a license until the pandemic abates. This failed to progress out of committee over the summer, and it looks as if the plan was abandoned when casinos reopened.
Unfortunately, it’s hard to hurry through red tape, so the process hasn’t gone quite as quickly as some might have hoped. When attempts to hurry the process began, representatives told Online Poker Report that the best-case scenario would be an October launch.
By late September, it had become apparent that there were simply too many steps and too many parties involved for everything to go perfectly. Even the early steps were each taking a few days longer than the theoretical minimum, and those delays were adding up. Furthermore, there was an issue that arose with the FBI involving access to fingerprints for purposes of licensing background checks.
From there, the revised estimate was changed to Thanksgiving weekend, but that has now come and gone as well. At this point, Michiganders would be forgiven for taking a skeptical view of the possibility of a December launch.
That said, it is a finite process, and there are few steps remaining. While waiting for JCAR, the MGCB has already begun testing and licensing for third-party suppliers. Assuming the committee does sign off on the rules tomorrow, the last major task will be for MGCB to award some operator licenses and wave the green flag.
If that is going to happen this year, it will probably happen by mid-month or shortly thereafter. Many MGCB employees will presumably be off between Christmas and New Year. Also, launching new gambling products right when people are supposed to be spending time with their families would be bad optics in any case.
The only caveat here is that there are over a dozen potential operators in the state. All of them have partnerships lined up, and most of them want to launch as soon as possible. Unless the MGCB is remarkably efficient, it seems improbable that they could award so many licenses in the span of two or three weeks.
If the MGCB insists on a fully synchronized launch in the interests of fairness, then we could still be looking at a 2021 go-live date. However, there’s enough pressure for a prompt launch that it’s more likely we’ll see a few operators go live in December. The others will then follow in the new year.
But which operators will be part of the first wave? That’s a matter of guesswork at this point, but it will probably be some or all of the following, in order from most to least likely:
There are a few factors influencing these guesses.
The operators themselves have given clues in their press releases and other public communications over the past months. In some cases, Michigan is addressed specifically, other times only in passing while discussing other business deals.
Most companies have said they plan on launching “as soon as possible,” or explicitly mentioned “late 2020.” However, Golden Nugget and PointsBet have both talked about an “early 2021” launch. This could simply be pessimism about the regulatory timeline but may also indicate some delays on their end. Thus, they should be considered less likely to be included in the first wave.
Retail sports betting in Michigan has been active since early March, though it was interrupted almost immediately by the pandemic. Still, there are seven retail sportsbooks now taking wagers in the state. Their operators already have a relationship with the MGCB and will be eager to get their online operations going as soon as possible.
Furthermore, integrated sportsbook-casino apps have been big moneymakers in other states. We can probably expect companies offering them to be a high priority since the state is looking at this as a source of tax revenue. All of those on our list fit this category, save for Hollywood. Its land-based partner, the Greektown Casino, will be going with the new Barstool Sports brand for sports betting, which could delay their launch.
Conversely, poker is both a minor product and presents more complicated testing challenges due to its peer-to-peer nature and risk of cheating. In Pennsylvania, PokerStars took four months longer to launch than the first online casinos. The delay might not be so long in Michigan, but they should still be considered an underdog to go live on day one.
Each Michigan casino can have only one online partner for each vertical. However, there are many online brands wishing to enter the market and only three commercial casinos. The remainder are tribal casinos.
The three brands with commercial partners — i.e., FanDuel, BetMGM, and Hollywood — are probably at an advantage for a swift launch. First, their land-based partners already work with the MGCB, while the tribal casinos are self-regulated. Second, these operators will pay an additional local tax to the city of Detroit, while those with tribal partners will not. That, too, could make them a higher priority for the state.
Finally, the licensing and testing processes for online gambling are different from those for retail operations. Thus, companies that have been operating online for their entire history will tend to navigate the hurdles more efficiently.
FanDuel and DraftKings definitely hold the advantage here. BetMGM and BetRivers may do well too, as their online divisions operate largely separately from the parent company. Conversely, the likes of Wynn and Parx have less experience in this regard, and this might make it less likely that they’re ready to go immediately.