‘Skin’ provision added at urging of Penn National Gaming
After a closed-door executive session last week, the Pennsylvania Gaming Control Board issued temporary regulations for the conduct of legal sports betting in the state. The new regulations, which follow a public comment period in which stakeholders flooded the gaming board with suggestions, limit each of the land-based casinos in the state to one live sports book and one online sports book, with a single “skin” or domain.
The temporary regulations, titled “Conduct of Sports Wagering Generally and Licensing Provisions,” address several issues surrounding sports betting as legalized under last fall’s gaming expansion law.
“This temporary rulemaking includes rules to ensure the integrity and security of sports wagering in this commonwealth,” wrote the board, “and all persons participating in this new form of entertainment in the state.”
The rules say that a sports betting certificate holder, or a sports wagering operator licensee on behalf of a certificate holder, can operate one brick-and-mortar sports book—meaning that no operator can run a sports book in both a primary casino and a satellite or “mini” casino.
The online wagering provision limits bettors to wagering “through a single interactive website or mobile application that clearly and prominently displays the name of the sports wagering certificate holder.”
This provision would have a negative effect on DFS sites FanDuel and DraftKings. Since the rule limits casinos to one “skin” for sports betting, the DFS giants would effectively be shut out of the sports betting market in Pennsylvania, unless they partner with a licensed casino operator.
The rule seems to be in response to a comment on draft rules made by Penn National Gaming a few weeks ago.
“The failure to prohibit ‘skins’ with respect to online/mobile sports wagering would present significant new competition to the incumbent casino operators and result in overall saturation of the marketplace, as is occurring in the online gaming marketplace in New Jersey,” Penn wrote.
New Jersey casinos and racetracks, by comparison, can offer up to three sports-betting brands each, in addition to a physical sports book.
“The New Jersey market has proved that multiple skins are necessary to create a vibrant and competitive marketplace and to provide an incentive for operators to market their services,” Ed Andrewes, who heads up Resorts Casino’s online operation in New Jersey, told Online Poker Report in February. “The current incumbents may feel that by limiting the skins it saves on marketing expense, but experience from other jurisdictions shows that a lack of marketing initiative and effort does not grow the market at all.”
“Such a limitation would be a step back on the nascent online gaming industry as a whole,” Golden Nugget’s Thomas Winter also told OPR. “The only reason to do it would be to protect land-based casino revenues.”
Other regulations deal with integrity issues. Casinos offering sports betting are required to hire third-party monitors to ensure the integrity of the wagers. Third-party integrity monitors are common in other places, including Europe and Nevada, where sports betting has been in place for years.
