The Arizona Department of Gaming (ADG) announced plans to open the application window for at least two of the state’s three remaining licenses next summer. These licenses will be reserved for a tribal gaming group and a professional sports franchise, reflecting Arizona’s commitment to inclusivity and collaboration in its gaming framework.
Operators can submit applications from July 8-19, but the process may face challenges. With most major tribes and sports teams already partnered with sportsbooks, negotiations could prove difficult.
As the ADG noted, applications must meet stringent criteria under the state’s event wagering rules and statutes. Despite the opportunity for market growth, the current landscape — dominated by giants like DraftKings AZ and FanDuel AZ, which hold over 70% of market share — may deter smaller operators from entering.
The state’s market potential remains strong, evidenced by a historic September that saw $732.1 million in gross revenue, a 20% increase year-over-year. This growth is part of a broader trend fueled by events like the NFL season kickoff and March Madness.
However, with all major sportsbooks already active in Arizona, smaller or niche platforms may hesitate to invest in a saturated environment.
Tackling Illegal Operators and Eyeing New Horizons
Arizona has taken proactive steps to address illegal sports betting, recently issuing a cease-and-desist letter to Bovada, an offshore sportsbook operator. The ADG labeled Bovada as an
“alleged felony criminal enterprise,”
citing violations such as promoting gambling, illegal enterprise control, and money laundering.
This crackdown reflects Arizona’s commitment to safeguarding its regulated market.
“Our enforcement team is committed to preventing unauthorized operations,”
said ADG Director Jackie Johnson. Bovada has since added Arizona to its list of restricted states, joining 15 others where regulators have taken similar actions.
Looking ahead, Arizona’s gaming landscape could evolve further with the potential legalization of online casinos. While sports betting has already transformed the state’s economy — generating $23.2 million in tax revenue in January 2024 alone — AZ online casinos could bring even greater financial benefits.
Such legislation would require careful negotiation with stakeholders, particularly tribal groups, which have played a central role in Arizona’s gaming success.
As Arizona continues to refine its gaming policies, its balanced approach offers a blueprint for other states. The industry’s rapid growth since legalization in 2021, coupled with regulatory vigilance, positions Arizona as a leader in the U.S. sports betting market.
Sustaining Growth Amid Challenges
Arizona’s thriving market ranked seventh nationwide in total handle for 2023, driven by events like the Super Bowl and a robust mobile betting infrastructure. September marked the fourth time this year that U.S. states collectively surpassed $1 billion in monthly sports betting revenue, underscoring the industry’s momentum.
Despite these successes, Arizona must navigate challenges like market saturation and illegal operators. The state’s ability to sustain growth will hinge on its willingness to adapt — whether by attracting innovative platforms, enhancing regulations, or exploring online casino legalization.
Arizona’s sports betting landscape remains a dynamic and lucrative space, with opportunities for growth and innovation. As it expands its market and addresses emerging challenges, the state is well-positioned to remain a trailblazer in regulated gaming.
