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DC loses $4 million on new sports betting app in its first full year

Washington, DC sports betting app GambetDC reportedly lost $4 million in its first full year of operation. A person is pictured betting on a generic sports betting app in this undated file photo.

A sports betting app launched by the DC Lottery in Washington, DC, reportedly cost the district $4 million in its first full year of operation.

Lottery officials admitted that the GambetDC app lost millions in 2021 due to marketing costs and underperforming revenue estimates, according to DCist. The app has been heavily criticized since going live several months later than expected in May 2020, when most professional sports were inactive due to the COVID-19 pandemic. It had already been projected to generate $6.2 million in revenue last year.

Lawmakers legalized sports betting in DC in 2018. Private sports betting revenue was reportedly better than expected last year. Meanwhile, GambetDC could continue to significantly underperform going forward, with a 2022 estimate predicting it to fetch $1.5m, a huge decrease from the $20m that was forecast. .

GambetDC is the only sports betting app licensed to operate fully in DC, with other apps limited to a two-block radius of the physical sports betting location. DC Lottery director Frank Suarez reportedly defended the arrangement and inaccurate revenue estimates, which were made before he became director, after being quizzed by DC Council member Kenyan McDuffie on the permission to use other applications throughout the district.

“The model is good. Right now, compared to some of the other models, it’s set up to give you the best return on revenue,” Suarez said, according to DCist. “The way the model is structured is solid and it helps the district… stimulate local businesses and the economy. So it’s a solid model. We have to be very realistic about revenue expectations. We know a lot more than we used to.”

“Previous estimates were made with very limited data,” he added. “You can look and see that the district is getting closer to what the original [estimate was] we would have to multiply our population by ten when you look at any jurisdiction that makes those numbers. That’s why you see such a big difference with our new estimates, because they’re based on the learning we have and what we’re seeing across the country. »

A technical issue rendered the app unusable on Apple phones during this year’s Super Bowl. Lottery officials pushed back against fierce reactions to the incident, which they say resulted from lottery contractor Intralot not properly pre-approving a required Apple update.

Suarez reportedly admitted the issue caused “reputational damage” to the app as well as lost revenue during his trade with the DC Council. A pre-Super Bowl prediction predicted it would be the biggest sports betting day in American history.

Newsweek contacted the DC Lottery for comment.


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