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Tennessee Regulators Report ‘Encouraging’ Start For TN Sportsbooks

The first week of legalized Tennessee sports betting was a huge success, with bettors wagering over $27 million in the first eight days.

Sports betting has gotten off to a hot start in Tennessee this month. Bettors wagered $27.4 million at the state’s online sportsbooks during their first eight days of operation from Nov. 1-8.

Two Sundays bookended that period, including the first when sports bettors gambled $5.1 million on Nov. 1.

The Titans lose, the sportsbooks win

The Tennessee Education Lottery (TEL), which regulates sports betting in the state, shared those figures at a meeting earlier this week. The totals reflect early action at the state’s four live online sportsbooks:

  • Action 24/7
  • BetMGM
  • FanDuel
  • DraftKings

“These numbers are encouraging as we work to protect the consumer, promote fairness in sports, and regulate this new Tennessee industry,” said Rebecca Paul Hargrove, TEL president and CEO.

The total adjusted gross income enjoyed by the sportsbooks over those first eight days added up to almost $2.55 million.

Meanwhile, the state of Tennessee collected $509,000 in taxes over those first eight days. The majority of tax collected from sports betting (80%) will go to the Lottery for Education Account. The rest will go to local governments and programs for problem gambling treatment services.

The sportsbooks no doubt enjoyed some profit from fans betting on the Tennessee Titans on Nov. 1, the day of launch. Despite being a 7-point favorite versus the Cincinnati Bengals, the Titans lost 31-20.

At FanDuel, for example, about 81% of the moneyline bets for that first Sunday game involving the Titans were on Tennessee.

The currently 6-3 Titans have dropped another game since, losing 34-17 to the Indianapolis Colts on Nov. 12.

How to hold sportsbooks accountable for the ‘hold’?

While that first day helped the sportsbooks, over the initial eight-day period, the sportsbooks’ overall hold adds up to just under 9.3%. The “hold” refers to the amount kept by the sportsbooks after paying out winning bets and before paying taxes.

The $2.55 million won by sportsbooks from Nov. 1-8 is, therefore, a little shy of the 10% hold requirement placed on operators in the state. That said, the sportsbooks need not worry for now. The requirement does not go into effect until Jan. 1, from which point it will be calculated on an annual basis.

At their Monday meeting, the TEL discussed how best to ensure sportsbooks meet the hold requirement. Board members decided to create a discretionary system to levy fines and other penalties against sportsbooks that fail to meet the requirement (for the time being).

Other topics discussed included how to respond to other violations such as using advertising materials or offering promotions without obtaining necessary pre-approvals from regulators.

Three new operators coming soon to TN

The TEL also reported three new operators are poised to join the first four in the burgeoning Tennessee sports betting market. Those operators are:

  • BetAmerica
  • William Hill
  • WynnBet

The TEL’s next meeting will be in December, at which time they expect to approve all three of the new operators.

Of the four currently operating, DraftKings and FanDuel both saw their licenses finalized this week. BetMGM and Action 24/7 continue with conditional licenses.

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