9 Critical Questions After Ontario’s Online Gambling Rollout

Written By John Holden on April 7, 2022 - Last Updated on September 20, 2022
9 Questions About Ontario Gambling

Legal online gambling and multi-operator sports betting is not even a week old yet in Ontario.

But it’s time to dig a little deeper and prophesize on what some of the big post-launch questions will be.

It is obviously too early to tell if the grand experiment is going to be a big win for Ontario or its residents.

But at least Ontario sports bettors have more choices. And, they have the opportunity to promo-shop for some time at the expense of everyone trying to make a name for themselves in the market.

Canadian Gaming Lawyer Jack Tadman posed five questions to his Twitter followers on April 4, we’ll take a look at those along with a few others.

1. Does an online poker pool made up of only Ontarians stand a chance?

News that Ontario would not allow for pooling of players (and their money) across international lines certainly disappointed some online poker fans. Probably even more disappointing was the pronouncement that there would not even be inter-provincial pooling.

Pennsylvania is probably the best U.S.-comp for this scenario as the state is slightly smaller (by a million or two) in population but has so far opted out of interstate compacts. Poker in the state continues to truck along (even with higher tax rates). But it seems likely most would agree it would preferable to see the state join a compact with the other permitted U.S. states.

There is one advantage that is likely to keep poker an option for Ontario players, though with less action than they found previously. That is, compared to many U.S. jurisdictions, registration in Ontario costs so little.

Companies have very little to lose by staying in the Ontario market.

2. What about daily fantasy sports?

We saw a mass exodus of daily fantasy operators from Ontario on April Fool’s Day, but unfortunately, the joke is real.

Daily fantasy sports has relied on player pooling across state and international lines to offer guaranteed prize pools in the millions of dollars.

It is hard to see how for most events that would be a viable option in a fenced-off Ontario. While daily fantasy behemoths DraftKings and FanDuel have left the market, there is an open playing field if someone wants to come in and test DFS viability.

Costs are low and 13 million residents is a great population to prove a concept. Following the DK/FD model, it could even be an entry point for its own sports betting aspirations down the line.

3. Legal challenges, legal challenges, legal challenges where art thou?

Frequent readers of this site are undoubtedly aware of all the legal threats that circled around before the launch. Several First Nations groups expressed that they intended to challenge the new regulatory model and Ontario’s own Auditor General suggested that the regulatory model would be questionable under the requirement that the province “conduct” and “manage” gaming operations.

But, until someone files a challenge, the market trucks on.

We can learn something from the U.S. daily fantasy companies here. They employed a brute force attack on state gaming laws by establishing consumer support. There was then little interest from state law enforcement authorities to try to put the cat back in the bag.

That’s true even in states where the Attorney General issued unfavourable opinions on the legality of daily fantasy sports.

4. Where do First Nations groups fit into this new system?

The role that First Nations groups will have in the new open market system is something that is likely dependent on what lawsuits get filed.

It seems to be almost a certainty that at some point there will be litigation over a revenue-sharing arrangement.

Some of the delay may be waiting to see how much damage, if any, is done to the brick-and-mortar casino business from online gaming and existing agreements.

5. Who will be leader of the pack?

The big question for operators is who will lead the pack when the dust settles.

Some grey market operators had a leg up on the competition, as Ontarians had familiarity with the products.

However, there was definitely some public relations backlash when the regulator told companies they had to close out all bets opened before the regulated market began, cashing some futures bets prematurely.

The betting favourites are likely still the American juggernauts backed by billions of dollars, but DraftKings ongoing absence is likely giving others a chance to gain a foothold.

6. Where is Rogers?

We saw a big deal on launch day, as TSN entered a partnership with FanDuel.

But one of the big wild cards that has been front and center since the launch was announced was what will Rogers do?

That still remains something of an open question. We do know that Sportsnet will be rolling out betting content with Cabbie Richards as executive producer of that vertical. A new show, SN Bets, has been announced, but any bigger plans remain secret.

7. When will you be able to go to a sportsbook in Ontario?

While a number of casinos already have set up Proline kiosks, those hoping for a Las Vegas-style experience are likely to continue waiting.

There needs to be a deal reached between the Ontario Lottery and Gaming Corporation, the casinos, and the Alcohol and Gaming Commission of Ontario before private operators could set up shop.

While this does appear to be the plan, at some properties at least, there is no ETA on when we might expect a true sportsbook in Ontario.

8. Who could be next?

As Ontario rolls out regulated betting from private operators the rest of the country is watching. The question of who will be next is becoming more
prominent, with Alberta as the odds-on favourite to follow Ontario’s lead.

But, for those hoping for a quick adoption in Alberta, do not hold your breath. Ontario’s model is likely going to have to prove itself before others are likely to hop on board.

At this point, it is still not clear what Ontario’s objective is: Recapture untaxed dollars from the grey market, or create a market so desirable that the volume of betting exceeds the monopoly profits that were the product of Proline.

9. Does anything change if the party in power changes?

A win by Doug Ford in June would all-but guarantee the status quo remains from a legislative perspective.  A win by the Liberal party or a power-sharing agreement between the Liberals and the NDP could however spark a shakeup.

Much is going to depend on the revenue coming into the province’s coffers. But unlike the ill-fated 407 sale, which cost the province billions, there was not a sell-off here. politicians could pull the plug and walk away if it does not prove fruitful.

Of course, pulling the plug on a competitive market would infuriate consumers.

But it can happen. Just ask Florida.

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John Holden

An Ottawa native raised in Oakville, John Holden J.D. / Ph.D. is an academic. His research focuses on policy issues surrounding sports corruption.

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