DC Lottery Ditches Gambet, Selects FanDuel For Sports Betting Monopoly

The DC Lottery was granted the authority to oversee sports betting in the nation’s capital when the activity was legalized in 2019, and now, almost four years after the May 2020 launch, the lottery is making a major change with regard to its sports betting contract.

After the Office of Lottery and Gaming (OLG) awarded a no-bid contract to the Greek company Intralot for its online wagering monopoly, Intralot rolled out the GambetDC app — kicking off years of criticism and financial underperformance. On Friday, as iGB first reported, Frank Suarez, executive director of the OLG, sent a letter to Kenyan R. McDuffie, the chairman of the District of Columbia’s Committee on Business and Economic Development, explaining that Intralot plans to replace GambetDC by subcontracting the operation to FanDuel.

“Having FanDuel as Intralot’s new subcontractor will help the District realize higher revenue, improve user experience, and deploy leading responsible gaming tools, all while mitigating risk by guaranteeing higher sports wagering revenue to the District regardless of performance of the sportsbook under FanDuel’s brand and management,” Suarez wrote. “In addition, this new relationship will support small and local District businesses that are currently relying on sports wagering as one of their revenue streams.”

FanDuel is the leading U.S. mobile sportsbook by handle and revenue, and, with its launch in North Carolina Monday, is available in 22 states.

Gambet was only available in D.C. and was best known for crashing during the 2022 Super Bowl, offering subpar odds compared to mobile books in other states and brick-and-mortar options in the District, and delivering disappointing tax revenue. To this point, Gambet is the only sportsbook app available throughout the District, while certain other apps are available for use exclusively on the premises of professional sporting venues, including BetMGM at Nationals Park.

OLG makes guarantees

Since launching, sports betting in D.C. has generated just $8.49 million in total tax revenue.

In the letter, Suarez detailed “guaranteed increased sports wagering revenue.” He spelled out that FanDuel will pay the OLG a $5 “platform conversion fee” within 37 days after signing the contract with Intralot, and also that if the Intralot contract is extended — it’s set to expire in July — $10 million in revenue per year for the four years from July 2025-July 2029 is “guaranteed.”

Importantly for the lottery, Suarez noted that the OLG’s sports betting operating expenses are no more, with FanDuel assuming those $2-$4 million in annual costs.

FanDuel has nearly 50% market share in the neighboring states of Maryland and Virginia, and Suarez claimed that FanDuel customers living in D.C. but crossing the border to bet have generated $15 million revenue in those states. Much of that would theoretically stay in D.C., and be taxed in D.C., once FanDuel Sportsbook becomes available in place of Gambet.

Suarez’s letter did not indicate when the changeover to FanDuel would take place.

Intralot has enjoyed a partnership with the DC Lottery since 2010, long before sports betting became a twinkle in any regulator’s eye outside Nevada. 

The DC Lottery sells tickets for such jackpot drawings as Powerball and Mega Millions, as well as numerous other draw games and scratchers. The District also permits iLottery, enabling customers to buy draw tickets online or to play eInstant games.