FanDuel Launches in Washington D.C. as Lone Sports Betting Operator

The Office of Lottery and Gaming (OLG) announced Tuesday that the Washington D.C. sports betting market is under the control of national leader FanDuel.

The move transitions the nation’s capital from its previous endeavor with Intralot’s maligned GambetDC product to the most frequented online sportsbook in America. All D.C. customers could access the FanDuel online and mobile betting app or use any of their betting kiosks at retail locations as of noon local time. 

GambetDC stopped accepting wagers on April 15 and will allow users until October 14 to withdraw funds from their accounts before all accounts are closed.

The launch of FanDuel is a significant upgrade on GambetDC, which was the only sports betting operator that was licensed to operate in D.C. as a subcontractor of Intralot. 

FanDuel will now have sole control of the local market (with a couple of minor exceptions), which is still extremely underdeveloped due to the stigma attached to GambetDC.

“With FanDuel’s launch, D.C. residents and visitors will have access to a best-in-class sports wagering platform,” said OLG Executive Director, Frank Suarez. “FanDuel’s entry into our market brings not only a reliable, customer-friendly sports wagering experience to the nation’s capital, but it also includes guaranteed revenue that will be used to fund vital city programs.”

D.C. officials expect to generate $119 million in sports betting tax revenue. That includes a $5 million upfront conversion fee paid by FanDuel to the General Fund, which supplies funding to services such as education, public safety, housing, child services, and recreation.

FanDuel also expects to accrue $2-4 million in annual operating expenses such as marketing and promotions.

D.C. residents and visitors will be allowed to place their bets using FanDuel’s platform anywhere in the District that doesn’t include federal lands or is within a two-block radius of designated Class A facilities, which include Audi Field, Nationals Park, and Capital One Arena.

“FanDuel’s industry-leading offering will ensure that the District maximizes tax revenue under its existing contracts this year while delivering a best-in-class experience,” Suarez said after the deal was agreed.

The underperformance of the D.C. market has been one of the rare stories of failure since the sports betting boom.

38 of 50 states (and D.C.) launched legal sports betting services in the time since the federal court system decided to expand the pastime nationally. While most states have thrived and benefitted from the increase in tax funding, D.C. continually fell well below its expectations.

Local officials estimated in 2019 the District would gain $20 million in annual funding, which would equal $84 million by New Year’s Day 2024. Instead, GambetDC produced just $4.3 million in extra tax revenue, just over 5 percent of what was projected.

The Washington Business Journal also reported that $116.2 million was wagered at five local retail sportsbooks compared to $69.6 online during the fiscal year that ended on Sept. 30.

D.C. Council member and chairman of the business and economic development committee, Kenyan R. McDuffie (I-At Large) went so far as to call the previous operator’s performance in the D.C. market “dreadful.”

The OLG believes that betting kiosks housed in local establishments will also churn a higher profit now that the switch to FanDuel is complete in a “high tide raises all ships” situation.

Local legislators have floated the idea of opening up the market to a competitive bid process in the future, meaning that other operators such as DraftKings, BetMGM, Caesars, ESPN Bet, and Fanatics, among others, could apply for entry to the market. Those plans have not received regulatory approval.