Breaking: Delaware Lottery to Select 888 or RSI for iGaming Contract

888 was expected to submit a bid, but BetMGM & PokerStars surprisingly took a pass. In another twist, Rush Street Interactive (RSI) also applied for the contract.
Delaware Lottery to Select 888 or RSI for iGaming Contract
March 08, 2023

In a surprise development, the Delaware Lottery will pick either 888 Holdings or Rush Street Interactive (RSI) as its exclusive online poker and casino gaming vendor after rivals BetMGM and PokerStars declined to bid on the contract.

Chicago-based RSI, which owns the BetRivers and SugarHouse brands, joined 888 US Incorporated, a subsidiary of UK-based 888, in submitting bids for the five-year contract. The agreement could be extended for an additional five years.

The way the bidding process is playing out is surprising for many reasons. It is especially strange, considering RSI does not currently offer online poker but plans to do so “eventually.”

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That appears to run counter to minimum requirements for vendors outlined in a request for proposal (RFP) issued in January, which states that a vendor must have had its products or services available in a regulated US market for at least one year. But since BetRivers and SugarHouse have been offering online casino and sports betting for years, RSI qualifies.

Equally surprising is that BetMGM and PokerStars both took a pass on Delaware. That could mean neither operator is particularly interested in Delaware, a small state that ranks 46th in population (1 million). To make online poker in Delaware successful, both operators would likely need to prepare their online poker rooms in Michigan and New Jersey for multi-state poker and eventually combine player pools.

PokerStars also missed an opportunity to avenge being passed over for 888 when the Lottery first announced the contract in 2013.

Vendor Presentations Scheduled This Month

Seven companies ultimately submitted bids for the contract. In addition to RSI and 888, bids were received from Evolution Gaming, GeoComply Solutions, Kambi Group, LexisNexis, and Light & Wonder (formerly Scientific Games), according to a list posted by the Lottery.

The bids by the other five companies appear aimed at different parts of the RFP. Besides online poker, casino, and sports betting, the Lottery is looking for game vendors and seeking managed service providers, including one for a player account management (PAM) system.

In an exclusive, Rebecca Satterfield, iGaming Manager for the Lottery, told Poker Industry PRO on Tuesday that the Lottery considered all seven applicants to be qualified as vendors. As part of the approval process, Satterfield said all seven firms would be invited to present to Lottery staff later this month and into April.

The Lottery will listen to primary and game vendor presentations between March 15 and March 24. Final recommendations to the director of the Lottery for both vendor types are scheduled for March 29, with a notice of intent to start negotiations planned for March 31.

Support service vendors are scheduled to make their presentations between April 3 and April 12, with final recommendations planned for April 14 and negotiations to begin on April 19. The Lottery has said it wants to go live with a primary vendor no later than November 1, 2023.

888 Likely Has the Edge Over RSI

There are several reasons to believe that 888 will ultimately be awarded the Lottery’s exclusive iGaming contract for a second time.

888 has provided online poker and casino gaming through skins at three racinos — Bally’s Dover (formerly Dover Downs), Delaware Park, and Harrington Raceway — since 2013, and from all outside appearances, has done a solid job in doing so. The operator also has extensive experience with online sports betting, something the Lottery would like to launch but never has.

It also seems extremely unlikely that, after a decade where Delawareans had access to real money online poker, the Lottery would take that away — even though online sports betting and (especially) online casino are bigger moneymakers for the state. Awarding the contract to RSI also means breaking with an operator they’ve known for a decade in favor of another they are not as familiar with.

888 was widely expected to submit a proposal, and the Lottery would want to hear a presentation from the UK-based company. 888 US President Howard Mittman hinted that such a move was forthcoming in mid-January.

Until now, 888 has taken advantage of Delaware’s membership in the Multi-State Internet Gaming Agreement (MSIGA), a multi-state compact for online poker and some casino gaming. Through MSIGA, 888 combined player pools with WSOP players in Nevada and New Jersey — creating the so-called WSOP/888 US Network, which includes the three Delaware racinos and players on WSOP NJ and WSOP NV.

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… But Don’t Count RSI Out

All the aforementioned points aside, the Lottery could still ultimately pick RSI.

Although RSI currently doesn’t offer online poker on BetRivers on SugarHouse, it did acquire the Run It Once Poker (RIO) platform in a cash-and-stock deal valued at $5.8 million March 2022.

Last summer, in the wake of RSI completing its acquisition of the television series Poker Night in America, CEO Richard Schwartz said the RIO and Poker Night acquisitions “position us well for when we eventually launch online poker, and the associated strong cross-sell opportunities that poker will bring to our casino and sportsbook verticals.”

RSI would likely want to launch online poker in Michigan and New Jersey ahead of a launch in Delaware. Obtaining the necessary regulatory approvals will take some time, but shared liquidity across all three states is considered essential if online poker is to be successful in Delaware.

A successful bid by RSI could hinge on a promise to offer online poker on November 1 or be prepared to offer it sometime soon.

RSI declined to comment Tuesday.

If you or someone you know has a gambling problem and wants help, call the Virginia Council on Problem Gambling (VACPG) helpline at 1-888-532-3500

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