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Next attempt at sports betting app ready to launch in W.Va.

May 23, 2019

CHARLESTON — On-again, off-again efforts to launch sports betting mobile apps in West Virginia appear to be on again, with Hollywood Casino in Charles Town set to have a soft launch of its sports wagering app as early as next week.

At Wednesday’s state Lottery Commission meeting, director John Myers confirmed that Lottery officials were on pace to complete testing of the casino’s mobile app as early as by the end of the day.

“The idea at this time is that we will finish our testing, which involves several things,” he said.

Lottery security and technology staffers have to verify that the app can perform a number of functions required by law, including verifying the player’s identity before accepting wagers, and accurately using geo-location technology to verify that the individual is within state borders when any bets are placed.

Once the testing is successfully completed, Myers said the Lottery will issue a letter of approval, giving Hollywood Casino the go-ahead to proceed with the mobile app launch.

Myers said casino management indicated they will want to conduct staff training before a soft launch of the mobile app, likely next week.

Launches of mobile app technologies at the state’s casinos had been on hold while casinos were awaiting a U.S. District Court ruling on a federal Department of Justice plan to strictly interpret the Wire Act, a 1961 law intended to crack down on organized crime by making it illegal to use “wire communication” to transmit bets or wagers across state lines.

Myers said last month that management of the state casinos was concerned that they could be in violation of a strict interpretation of the Wire Act if sports betting data were routed through internet servers in other states.

“We’ve had a lot of discussions with the mobile app providers, and we feel like we’ve been able to locate the servers in question in West Virginia so the information won’t travel across state lines,” he said Wednesday.

Initially, prior to the DOJ action, two West Virginia casinos, Mardi Gras in Nitro and Wheeling Island, launched sports apps in late December, but parent company Delaware North shut down both the sports apps and on-site sportsbooks at both casinos March 6 when the company providing the sports betting technology became embroiled in a contractual dispute with a third-party software provider.

Sportsbooks at both casinos remain out of commission and may remain closed until a breach of contract suit brought by Delaware North is resolved.

It is not clear if or when Mountaineer Casino near Chester or the casino at The Greenbrier intends to launch sports betting apps.

The three casinos have been operating on-site sportsbooks since last fall.

Myers said he’s interested to see how the Hollywood Casino sports betting app performs, since Hollywood generally produces more gaming revenue than the four other state casinos combined. Also, he noted that the Delaware North mobile apps were beginning to outperform the on-site sportsbooks at the time they were shut down.

The app, operated by Draft-Kings, will be available for download without requiring a trip to the Charles Town casino, he said.

Also at Wednesday’s Lottery Commission meeting:

• Lottery revenues remained strong in April, with gross revenues of $96.1 million, up $4.2 million from April 2018, as all categories of Lottery games, including struggling racetrack video lottery and table games, saw increases.

Year-to-date, with two months remaining in the 2018-19 budget year, gross revenues of $949.2 million are $44.8 million ahead of the same point in 2018 and ahead of projections by $16.5 million.

That puts the Lottery on pace to top the $1 billion mark for gross revenue for the 17th consecutive year.

The state’s share of Lottery profits total $45.6 million for April and $434.7 million yearto-date, up $18.2 million from last year.

Myers said the improved numbers reflect a strong economy providing individuals with more disposable income, but said sportsbooks appear to have increased foot traffic at the three casinos, which have seen increases in food and beverage sales as well as in gaming revenue.

• State revenue from the 10% privilege tax on sports betting revenue topped the $1 million mark year-to-date, as casinos paid $65,402 in taxes on $654,026 in revenue in April — 91% of which came from Hollywood Casino.

Wheeling Island and Mardi Gras had sports wagering losses of $47,155 and $46,735, respectively, as they continue to pay out winnings on bets made prior to the March 6 shutdown on future sporting events, while they are producing no sports betting revenue.

• Commissioners approved licenses for five sports wagering vendors, including one management services provider, and four data services or technology providers.

• Commissioners fined Limited Video Lottery retailer Terry’s Cafe in Whitesville $5,000 for cashing checks for LVL play.

Reach Phil Kabler at philk@wvgazettemail.com, 304-348-1220 or follow @PhilKabler on Twitter.

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