Online Operators Attempting to Salvage California Sports Betting Hopes Ahead of 2024

It turns out we may get a piece of California sports betting legislation in 2024 after all.

Ever since both of The Golden State’s sports gambling measures failed during the 2022 election, progress toward another initiative (or multiple initiatives) has been slow-moving. The conversation between key stakeholders has not just reached an impasse; no one’s even sure any meaningful conversations have happened, period.

As a result, many experts and industry insiders have openly wondered whether California sports betting may get left off the 2024 electoral ballot altogether. That sentiment, while originally considered unlikely, has looked more and more possible in recent months. California’s tribes have made it clear they don’t want online sportsbooks in the United States operating independently inside the market. These online companies, meanwhile, have so far been reluctant to act as what amounts to sports gambling IT support for the state’s tribes.

Given this gridlock, only two outcomes seemed plausible when 2024 California legislative sessions rolled around: The state would once again have numerous sports betting bills on their electoral ballot that cannibalized each other, or there wouldn’t be any California sports betting bills of which to speak until 2025 or 2026.

However, with the next round of legislative meetings just a few months away, it appears both online sportsbooks and local tribes are willing to sit back down at the bargaining table. In fact, depending on which report you believe, they might already be seated at said table.

FanDuel is Reportedly Looking to Talk About California Sports Betting with State Tribes

The future of sports betting in California has always hinged on online operators, state tribes or both making concessions on their current stances. Recent comments made by the vice chairman for the Morongo Band of Mission Indians, James Siva, suggests that FanDuel Sportsbook may be willing to at least broach the subject. Here’s the latest from Mike Mazzeo of Legal Sports Report:

FanDuel Sportsbook is attempting to mend fences with California tribes and find a pathway to participating in legal sports betting. James Siva, vice chairman for the Morongo Band of Mission Indians, told LSR Wednesday that FanDuel Sportsbook indicated its willingness to be a business-to-business operator in a future legalized California sports betting landscape. ‘FanDuel has been more amenable to reaching out to a number of tribes,’ Siva, who also serves as chairman for the California Nations Indian Gaming Association, said at the Indian Gaming Association Mid-Year Conference at Foxwoods Resort Casino. ‘I’ve heard from a number of tribes that they’ve reached out. I haven’t heard much from DraftKings, whether they’ve reached out.’”

If true, this is a pretty massive development for sports gambling in California. So far, state tribes have only wanted online sportsbooks in the USA to serve as supporting partners in any legal gambling endeavor. Essentially, this would mean bigger companies such as FanDuel would help tribes run their own California online sports betting apps and receive a fee or commission for doing so. 

On the surface, this sounds like a traditional partnership. And it is in some ways. But those online sportsbooks would not be able to operate as independent entities or share in the same profits or tax breaks as California tribes. 

These terms have been a no-go for the most popular online betting sites in the United States. At least, these terms used to be a non-starter. Because if Siva is correct, the biggest online sportsbook in the USA may be on the verge of changing their tune.

Is FanDuel Actually Warming Up to the Idea of Being a Business-to-Business Sports Betting Operator in California?

Everything above sounds super encouraging if it’s accurate. But we have to put that emphasis on if. 

Mazzeo reached out to FanDuel for comment, and they responded by saying there was “nothing new to report” on the California sports gambling front. He also reached out to DraftKings, who declined to provide any comment. 

To be sure, this doesn’t mean Siva’s information off-base. As Mazzeo also noted, FanDuel’s comments on the matter came before Siva told LSR about the new round of conversations. The company’s response could be different in the coming days and weeks.

Still, it’s worth acknowledging that this would mark a massive departure from FanDuel’s previous party line. High-ranking officials have said or hinted that they’re prepared to play the longer-term game, wait out lulls, delays and failures in hopes of gaining independent licenses to offer sports betting in California. To go from that to “Sure, we’ll participate in California sports betting as basically a hired hand” would be a colossal divergence. 

What Could This All Mean for the Future of California Sports Gambling?

The severity of this logistical shift doesn’t mean it's impossible. FanDuel could simply be hoping to latch onto a tribal gaming compact, get their foot in the door and enter the California market independently down the line. That would still qualify as playing the long game.

But even if FanDuel is on board, that doesn’t mean other online sportsbooks will be, as well. And if industry staples such as DraftKings aren’t on the same page, you better believe they’ll do their darndest to lobby against and contest whatever sports betting initiative emerges from 2024 California legislative meetings.

To that end, it’s difficult to gauge the importance of FanDuel's (apparent) interest in the business-to-business mode. It certainly matters, but even with their support, there’s no guarantee a California sports betting bill gets approved in 2024, let alone legalized.

Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs: