Michigan Online Gambling Q&A With MGCB Director Richard Kalm

Michigan sports betting fans from around the state have been on pins and needles in recent months as the Michigan Gaming Control Board and state legislature iron out the final rules and regulations governing the imminent launch of online sports betting and casinos.

The latest set of rules crafted by the MGCB now sit with the Joint Committee on Administrative Rules. The initial timeline for the launch of legal online sports betting and internet gambling had a rough estimate of early 2021. However, in an interview this summer, Michigan State Rep. Brandt Iden told Michigan Sharp that there is hope for a fall 2020 launch, assuming the legislature and MGCB come to an agreement around a finished set of rules.

We recently got in touch with Richard Kalm, who has served as Executive Director of the MGCB since 2007, to get a bead on where the state stands with its launch timeline, his thoughts on the market’s potential, and some finer points about how online casinos and sports betting will work when launch day arrives in Michigan.

Michigan Sharp: When online gambling launches in Michigan, will online casinos launch at the same time as sports betting?

Richard Kalm: Internet gaming and internet sports betting should be able to launch at the same time provided applicable requirements of each act and related rules have been met.  After receiving the go-ahead from MGCB, it will be dependent on an operator’s and platform provider(s)’ readiness to determine when to launch each form of gaming. 

MS: Do you know if live dealer games will launch as part of the online casinos, or will those games be introduced later?

RK: Unless otherwise approved by MGCB, the live game environment used to conduct live games must be located in Michigan. I’m not aware of any live game environments that will be established in Michigan prior to the initial launch. Therefore, I expect live games will be introduced later.  

It’s possible an operator, independently or in partnership with a supplier, could offer live games from a live game environment located in its casino or another facility it owns.

MS: Will the launches of online gambling be staggered where whoever is ready to go live can go live once it passes, or will there be a specific date where a number of sites all launch at once?

RK: We may not identify a specific date. Instead, each operator’s launch date will depend on several factors. The rules will have to be finalized and take effect first. Then, the operator and certain employees, suppliers, and vendors will need to receive all necessary licenses, registrations, and approvals, including technical and internal control standards. Finally, the operator will have to be authorized for launch by MGCB, which cannot occur until at least one Indian tribe and one Detroit casino is issued an operator license. I think it’s fair to say we’re hopeful that multiple operators will be able to launch on or near the same date.

MS: Is online poker in the cards for Michigan in any meaningful way? Any testing either ongoing or on the horizon, etc.?

RK: We haven’t received internet gaming platform and internet game submissions yet and, therefore, can’t say with certainty whether any operators plan to offer internet poker. At least one operator has signaled it intends to submit a request to offer poker. However, given its limited profitability, I don’t know whether any operators will offer poker at launch. 

MS: As Director, could I get your sense of the online gambling landscape ahead of launch? Are you optimistic? Does the state seem ready? Any last-minute concerns, etc.?

RK: I’m optimistic. I think we’ve done good work thus far and have put ourselves in a good position. We drafted reasonable rules and have done everything we can to prepare for launch.  There’s a lot of work ahead, but I think the agency is up to the task. And I see no reason why the Michigan internet gaming and internet sports betting markets won’t be among the best regulated and most robust in the country. 

MS: Are you and the rest of the commission looking either working with or learning from existing online gambling markets that have already launched in other states like PA/NJ/others?

RK: Absolutely. We borrowed heavily from other states’ rules – primarily Indiana, New Jersey, and Pennsylvania – in drafting our internet gaming and internet sports betting rules. In addition, we’ve interacted with other gaming regulators, as well as operators/platform providers who operate in other jurisdictions, to learn from their experience and garner best practices. This interaction occurred throughout the rule drafting process and has continued as we work toward launch.

MS: Lastly, we’ve seen in many states that offer both online sports betting and land casinos that online tends to dominate, sometimes by a 98%-2% ratio. Do you expect Michigan sports betting to be so highly skewed towards online sports betting?

RK: Personally, I expect internet sports betting revenue to surpass retail sports betting revenue.  Comparing estimates for the internet sports betting market to the Detroit casinos’ current qualified adjusted gross receipts supports this assertion. There’s no reason to believe Michigan’s results will vary significantly from other states.

About the Author

Chris Nesi

Chris Nesi is a contributor at Michigan Sharp and the Managing Editor of Colorado Sharp. He’s been an editor and writer for more than a decade, with experience spanning newspapers, magazines, digital news, and commercial writing. His work can be found in publications including TechCrunch, Mental Floss, and Huffington Post. Chris enjoys politics and gambling, and writing about the points at which those worlds intersect.