Tennessee Sports Wagering Off to Impressive First Week Start
- Tennessee roars out of the gate as four licensed sportsbooks net $27m handle in Week One
- Questions remain for both sports bettors & operators concerning Tennessee’s “10% Rule”
- Excellent sign-up bonuses & promotions provide big incentive to push initial numbers
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Any first week of anxiety regarding sports wagering success in Tennessee was quickly set aside as the Volunteer State got off to an impressive launch. Right out of the gate, more than $5 million in bets were placed on November 1, the very first-day online sports gambling was made available in the state. Tennessee only offers online wagering and does not have onsite-retail sports wagering locations available.
Combined, the state’s four initial licensed sportsbook providers, BetMGM, DraftKings Sportsbook, FanDuel, and Tennessee Action 24/7 paid out an estimated $23.9 million and earned an adjusted gross income of roughly $2.54 million. Tennessee currently has three additional sportsbooks awaiting license approval including BetAmerica, William Hill, and WynnBET.
Totaling from November 1 through November 8 the four major sportsbooks provided $509,000 in tax revenue for the state according to officials. The money is appropriated to the Tennessee Education Lottery, which oversees sports wagering in Tennessee. Predictably, the majority of the first week wagers were placed on football, with the National Football League accounting for 60% of the action and NCAA college football 40%.
Tennessee Education Lottery President and CEO Rebecca Hargrove also shared on Monday that the four operators combined to take in $27 million in handle over the initial eight days. Hargrove noted that BetMGM “outstripped all other states on the first night by 200%”.
Hargrove said in a statement:
In our role as the regulator of this industry, we are focused on establishing and supporting a responsible and competitive sports wagering program in Tennessee. These numbers are encouraging as we work to protect the consumer, promote fairness in sports and regulate this new Tennessee industry that provides critical funds for education, as well as local governments and problem gambling services.
As per rules set-up by the TN Lottery, 80% of the tax collected will be distributed to the Lottery for Education, 15% will go to a General Fund for local government on a per capita basis and the remaining 5% be provided for the Department of Mental Health and Substance Abuse Services to oversee grant programs for gambling treatment services.
Tennessee and the “10% Rule”
A major unanswered question and worry shared by both sports bettors and sports operators within Tennessee is the outcome of Tennessee’s unique high 10% hold on licensed sports operators.
For the bettors, there is great concern that this excess tariff may be passed on to them, resulting in higher general lines on every game. IE: standard “dimelines” would not be possible.
For operators, the question remains whether they could be fined for ignoring the 10% hold rule.
That realistic situation has worried council members and the Tennessee Education Lottery that operators view a meager $25,000 fine as a “cost of doing business” to retain competitive lines for their customers. Also, to prevent bettors in Tennessee from seeking alternative via illegal offshore wagering.
Tennessee sports bettors also have no nearby state alternative to seek better pricing like Pennsylvania and New Jersey. The closest potential bordering situation may be Virginia, but that state is likely a year away from beginning operation. Currently, other US states holds average in the 5-7% range.
Excellent November Sign-up Incentives are Available
The four Tennessee sportsbooks are all offering significant sign-up incentives.
BetMGM has an instant match of up to $500 for a first deposit. DraftKings Sportsbook, a first deposit bonus up to $1,000. FanDuel is offering a risk-free wager up to $1,000, where should a new customer lose the game, the bet will be re-deposited back into their account. Local sportsbook Tennessee Action 24/7 is providing a first deposit match up to $100 for new customers.