Forty years ago, The Clash released its single “Should I Stay or Should I Go?” That very question is likely rolling around the heads of at least some sports bettors throughout New York after Caesars Sportsbook experienced multiple outages during the first weekend of the biggest wagering launch since the fall of the Professional and Amateur Sports Protection Act in 2018.
The Clash never answers its own question, but some in the sports betting world — most of whom wished not to be identified for this story — say that despite the frustration the outages caused, most bettors will opt to stay.
“There are so few [online sites] in the market there that I don’t know that it will have any kind of long-term issue,” said one stakeholder.
Another industry source said, “I don’t think it’s going to hurt you. You’ve got one weekend going in. You’ve now got time to recover. You’ve got people who can get their accounts going and get ready for next week. I think with the smaller outages, Caesars is going to do enough advertising to have that affect them.”
But Joe Stauff, an analyst with Susquehanna, doesn’t agree. He says Caesars’ app is lagging in comparison to industry leaders DraftKings and FanDuel, and that the weekend’s issues weren’t a one-time occurrence.
“People will try to get the [deposit] match and use it and move on, because it will be a better experience at DraftKings or FanDuel,” he told Sports Handle. Caesars “has a great brand for sure and they have an amazing advertising and marketing campaign, but they don’t have the technology. The app is a nightmare right now.”
Caesars, which was offering the biggest bonuses on opening weekend, was among four operators that launched digital sports betting in New York Saturday morning. The go-live capped a frenzied nine months that started with then-Gov. Andrew Cuomo all but forcing lawmakers and stakeholders to accept a limited marketplace for statewide mobile wagering.
Since then, operators, regulators, vendors, and everyone else in the industry have been part of a mad dash to launch. In the end, nine platforms will be available to New York bettors, but only four have been approved so far. BallyBet, BetMGM, PointsBet, Resorts World, and WynnBet are all still going through the approval process, according to the regulator.
Was it demand? Or a bigger problem?
Caesars didn’t release any kind of official statement, nor did it indicate what the issues were in New York over the weekend. But Caesars Entertainment CEO Thomas Reeg addressed the question on CNBC Monday morning. He said Caesars took nearly a million wagers in a 39-hour period between Saturday morning and Sunday night, which represented nine times the number of wagers placed during the Arizona launch in September.
“When you have massive demand, that’s when you see the pinch points in your system,” Reeg said. “Unfortunately, we did not have a flawless performance this weekend. As a sports bettor myself, I know how frustrating that is.”
During the outages, bettors were unable to lay down wagers. The Saturday outage appeared to last about three hours, while the Sunday outage was about 45 minutes.
Not sure if you're aware but Caesars in New York is down yet again and you cannot place a wager right before kickoff. Same thing happened yesterday before the Broncos/Chiefs game kicked off.
— Johnny Prescott (@JohnPre56103004) January 9, 2022
Caesars offered the biggest bonuses yet to new New York bettors, a $300 account signup credit and up to $3,000 in deposit funds. That potential $3,300, as well as brand loyalty, should be enough to bring bettors back.
“I think that people just couldn’t get down a bet, and they’ll have a short memory,” a media consultant told Sports Handle.
Stauff says Caesars’ issues aren’t new, and that the company had to come to market in New York with a blowout offer in order to convert customers who would otherwise go elsewhere.
“In general, the Caesars app has pretty consistently had outages and has had continued issues with geolocations, so this is pretty consistent state to state,” Stauff said. “What it tells me in general is they are still trying to fix the plumbing, the underlying software.
“It’s also a major issue for Caesars vs. someone else because they do not have marketing scale. They are still trying to build up an initial base of users. They’ve gone out with this promotion, and it’s an aggressive offer, and it has to be because DraftKings and FanDuel have significant customers … coming from New Jersey. It’s particularly difficult because they have an inferior tech stack, they have geolocation issues, and they are offering a $3,000 deposit match number. So if you can’t convert or you can’t use it, you’ll move on.”
Stauff estimates that 25-30% of FanDuel’s New York customers, and 10% of DraftKings’, will be New Yorkers who have been crossing the border to bet in New Jersey since 2018.
Other companies have struggled
It’s not the first — and certainly won’t be the last — time an operator has struggled to keep up with volume or had other issues arise.
There were reports that both DraftKings and FanDuel had more minor issues in New York over the weekend. But among the more recent major issues was DraftKings’ struggle during its Sports Betting National Championship, during which some players couldn’t get bets down. DraftKings shortened the competition and gave anyone who entered their entire $10,000 bankroll back, whether they were winning or losing at the time the issues cropped up.
Well New York, looks like we killed Caesars. 😂 pic.twitter.com/n7UnBsb4mA
— John (@Whatupbird1) January 9, 2022
And multiple big operators have struggled during the NFL playoffs and the Super Bowl. In 2020, FanDuel’s site went down several times during wild card weekend, and at least five platforms — Barstool Sports, BetMGM, DraftKings, FanDuel, and BetRivers — had disruptions ahead of the 2021 Super Bowl. In both cases, bettors couldn’t lay down bets, but the issues were resolved quickly and operators at the time talked about the challenge of handling massive volume.
“We’re aware customers were unable to access our mobile and online sportsbook. It appears this outage was caused by a surge in traffic that caused problems for our backend provider,” DraftKings wrote in a statement provided to Sports Handle after the 2021 Super Bowl outages. “Our DFS and pools products, supported by in-house technology, functioned without issue. This incident is why we believe owning our own technology is important.”
Though Caesars has not said what the issue was, observers say that if it is a “tech problem,” the company will need to remedy it as soon as possible to avoid further disappointment or stress for users. Anecdotally, bettors who are shopping lines or feel a brand loyalty tend to go back even after there are issues. In Michigan, a stakeholder told Sports Handle that when BetMGM went down ahead of the Super Bowl in 2021, his buddies were frustrated in the moment, but “they didn’t abandon MGM. The real bettors shop the lines, and I guess they were annoyed, but they went back.”
Week 18? Meh
Beyond that, the media consultant said that while the New York launch was a huge deal — according to geofencing company GeoComply, 17.5 million bets were placed over the weekend — the last week of the NFL season isn’t exactly a bettor’s dream weekend.
The first 36 hours of #SportsBetting in New York was LEGENDARY. In total, NY saw over 17M checks for their first weekend.
Check out this video of #geolocation volume! pic.twitter.com/FylPc2BpUQ
— GeoComply (@GeoComply) January 10, 2022
“It’s the worst NFL weekend to bet,” the media consultant told Sports Handle. “It’s not the worst thing for them to go out the week when nobody is in action. … It’s a whole different ballgame. It’s a good fire drill to have.
“I think brand loyalty will supersede the problems. Caesars has great branding and they’ve done a great job with JB Smoove,” the actor/comedian who has represented the brand in commercials.
The industry source said, “If they had those glitches, their marketing is going to come back and give [customers the bonus] if they didn’t get it. That’s already a loss leader for them, so they’re going to move it to the next stage. So if they thought it would work for them, then they will continue with it.”
The Caesars specials appear to still be available in New York.
Caesars roasted on Twitter
If Twitter is any indication, some bettors took the outages as an opportunity to poke a little fun at Caesars over the weekend. Here’s a sampling:
Caesars on their first day in New York https://t.co/YAz06iHOkg pic.twitter.com/AL6h1gk8lD
— New York Foxes (@NewYorkFoxes) January 9, 2022
New York got the Caesars app in ruins
— isaiah 🥷🏾 (@nycisaiah) January 9, 2022
What now?
According to Caesars’ media relations department, the bets just keep coming. The company took its one millionth bet on Monday morning, and was the most downloaded app in the App Store over the weekend. In another remarkable number, Caesars said that betting in New York between 9 a.m. Saturday and Sunday night nearly matched the combined handle of the other 20 states in which Caesars is active.
The outages appear to have had little short-term affect on Caesars’ stock price. The price closed at $89.66 on Friday, one day ahead of launch, and at $88.30 on Monday. On Tuesday, Caesars was trading at just over $89 at midday.
So, “Should I Stay or Should I Go?” Hard to say.
