On the first day of 2021 Iowa’s requirement of registering in-person prior to making sports bets online expired – which industry insiders say should prompt “exponential” growth and “billions” of dollars in wagers annually.
In 2019, analysts with PlayIA.com projected the Iowa sports betting market would generate more than $4 billion in bets annually, more than $300m in operator revenue each year, and more than $20 million a year in state taxes, all within five years.
The reality has been much less sunny.
Since online sports betting launched in Iowa in August 2019, there have been a total of $682.6m in wagers and $53.4m in revenue, producing a mere $3.7m in state taxes, per the state’s official statistics.
According to Jessica Welman, analyst for PlayIA, the in-person registration requirement has “unquestionably stunted” the growth of Iowa’s online sports betting market.
“With the requirement in place, Iowa would have never reached its potential as a market,” Welman said in a statement. “Letting the requirement expire is akin to correcting a mistake, and we expect Iowa to finally begin to blossom because of that correction.”
BetMGM, one of the largest operators in the U.S., launched in Iowa on Monday
Dustin Gouker, another analyst for PlayIA, pointed to Illinois, which launched sports betting earlier this year with an in-person registration requirement. That requirement was suspended over the summer as the coronavirus pandemic making it difficult to impossible for people to visit a physical sportsbook.
The effect of online registration on the Illinois market was “immediate,” Gouker said. Illinois grew wagers to $52.5m in July from $8.3m in June, thanks to an influx of 230,000 mobile sports betting accounts in the days after the state lifted in-person registration requirements.
In the months since, Illinois has grown to the fourth-largest market in the U.S., generating $434.4m in wagers in October.
