Michigan Online Gambling Could Soon Lose Fox Bet

Michigan online gambling includes online casino, poker, and sports betting. If Fox Bet folds, as many believe it will, the state will be down one online casino skin and one online sportsbook. However, they’re not on the same license, so that creates a huge list of hypotheticals.

The main one is Flutter Entertainment may be able to add another one of its brands to replace the joint venture with Fox Corporation if Fox Bet folds. That’s because Michigan laws and regulations don’t explicitly address the situation of one online brand being split between two land-based partners. (In other words, it’s probably okay.)

The State of Michigan Online Gambling

The Michigan Gaming Control Board (MGCB) allows 15 license holders to partner with Michigan online gambling operators.

There are iGaming partners for each license, but the Hannahville Indian Community hasn’t yet replaced its online casino gambling partner.

That partner was TwinSpires Sportsbook and Casino until Sept. 6. At that time, TwinSpires owner, Churchill Downs Inc. (CDI), folded its online casino and sports betting business.

Now, 888 Holdings is Hannahville’s platform provider. However, 888 only replaced the sports betting skin so far, with SI Sportsbook on Sept. 7.

So at the moment, only one Michigan online casino skin is missing.

Fox Bet’s Situation Is Uncertain

On Nov. 4, Fox Corporation announced it settled its arbitration with Flutter.

The disagreement was over FanDuel stock, and Flutter is FanDuel’s primary owner. Fox is Flutter’s media partner. Fox Bet is a Fox and Flutter joint venture.

The Fox Corporation statement reads:

Flutter cannot pursue an IPO for FanDuel without FOX’s consent or approval from the arbitrator. FOX has a 10-year call option that expires in December 2030 to acquire 18.6% of FanDuel for $3.72 billion, with a 5% annual escalator. FOX has no obligation to commit capital towards this opportunity unless and until it exercises the option. This optionality over a meaningful equity stake in the market-leading US online sports betting operation confirms the tremendous value FOX has created as a first mover media partner in the US sports betting landscape.

On Oct. 17, a Flutter spokesman told MichiganSharp that Flutter wouldn’t be pursuing a US FanDuel IPO due to the state of the economy.

Meanwhile, during a 3-hour-long presentation in Manhattan on Wednesday, FanDuel leaders concentrated on the brand that’s America’s No. 1 online sportsbook and No. 3 online casino.

In the event’s 113-page slide deck, Fox Bet is mentioned twice – in footnotes for being excluded from the financials.

Indeed in Thursday’s MGCB figures for October online gambling revenue, Fox Bet was the penultimate. Only Golden Nugget – known as an online casino brand – had lower gross gaming revenue (GGR) in sports betting.

The Guessing Game

If Fox Corporation believes Fox Bet is being neglected, it may pull the plug on the joint venture. If it does so, that creates a guessing game.

In Michigan, the Little Traverse Bay Bands of Odawa Indians partners with Fox Bet for sports betting and the Flutter brand PokerStars for online casino and poker.

MGCB lists The Stars Group (TSG) as the tribe’s platform provider. Flutter owns TSG.

So if Fox Bet exits, will Flutter cease offering sports betting on that license? Will Flutter use one of its different brands? Or perhaps Flutter will simply rely on the PokerStars sports offering.

Maybe a newcomer will apply?

In New Jersey, FanDuel itself was a test case. It offers sports betting through its partnership with the Meadowlands Racetrack. FanDuel Casino is on the Golden Nugget Atlantic City Hotel, Casino, and Marina license.

Based on Wednesday’s dearth of Fox Bet information in Flutter’s FanDuel presentation, it does seem clear that FanDuel is a priority and Fox Bet not so much.

At the very least, Fox Bet may soon cease to be a joint venture.

As for what happens to Fox Bet in Michigan, it’s unclear for now.

What MGCB Has to Say

On Thursday, MGCB Communications Specialist Mary Kay Bean spotlighted a current operator overlap as an example of what may happen if the Fox Bet situation changes.

The spokeswoman told MichiganSharp:

Our law and rules don’t address a situation where one brand would provide gaming on behalf of multiple operators.

However, branding can become an issue. The acquisitions of Golden Nugget by DraftKings and PokerStars by Flutter have already created complications in the state. Bean pointed these issues out to MichiganSharp:

Currently, Golden Nugget is the provider for the Keweenaw Bay Indian Community. Golden Nugget was purchased by DraftKings earlier this year. DraftKings is the provider for the Bay Mills Indian Community.

It’s unclear what, if anything, the MGCB intends to do about that. However, Bean also pulled out two sections of Michigan gaming law that apply here.

The Lawful Internet Gaming Act‘s section reads:

An internet gaming operator may offer internet gaming under a maximum of 2 separate brands, 1 for each of interactive poker and other casino style games. This subsection does not prohibit an internet gaming operator from using fewer than 2 brands or from using a single brand to offer any combination of interactive poker or other casino style games. Only an internet gaming operator or its internet gaming platform providers may process, accept, or solicit internet wagers under this act. All websites and corresponding applications used to offer internet gaming must clearly display the brand of the internet gaming operator or its affiliate. The internet gaming operator may also elect, in its sole discretion, to have the brand of each internet gaming platform that it utilizes be the name and logos or no more than 1 internet gaming platform provider if the internet gaming platform also clearly displays the internet gaming operator’s own trademarks and logos or those of an affiliate. The internet gaming operator is responsible for the conduct of its internet gaming platform provider.

Plus, she said this part of the Lawful Sports Betting Act may apply:

A sports betting operator may use no more than 1 internet sports betting platform to offer, conduct, or operate internet sports betting. Only a sports betting operator or its internet sports betting platform provider may process, accept, offer, or solicit internet sports betting wagers. The sports betting operator must clearly display its own brand or that of an affiliate on the internet sports betting platform that it utilizes. The sports betting operator may also elect, in its sole discretion, to have the brand of the internet sports betting platform that it utilizes be the name and logos of no more than 1 internet sports betting platform provider if the internet sports betting platform also clearly displays the sports betting operator’s own trademarks and logos or those of an affiliate. A sports betting operator is responsible for the conduct of its internet sports betting platform provider.

Mary Kay Bean suggested more answers are available through the Internet Gaming and Sports Betting FAQs For Businesses.

About the Author

Heather Fletcher

Heather Fletcher is a writer for Michigan Sharp with a focus on online casino content. She had her first published byline at age 10, but didn't get paid for her writing until she got her first newspaper job. Heather's work in Suburban News Publications in Ohio and eventually took her to The New York Times, where she's still a contract freelance reporter for the National Desk. In March 2021, Fletcher began writing about online casino gambling as the lead writer for Online Poker Report, which lead her to MI Sharp.