Delaware’s new lottery contract could mean a fresh start. Here’s why

Delaware’s “First State” moniker is a considerable source of pride, but another first has gone largely unheralded. Delaware, back in 2012, became the first state to authorize online casino games, or iGaming, which was revolutionary a decade ago. Still, Delaware’s Lottery-run iGaming and online poker offering was ineffective from its first day.

If you’re the only game in town, like Delaware Lottery’s provider is, you have a captive audience and minimal incentive to invest in the product upgrades and innovations — actions that drove iGaming markets in other states to quickly surpass Delaware’s. While the Delaware Lottery has chugged along — making a steady but wholly uninspiring $14 million in iGaming revenue in all of 2022 — states like Pennsylvania have adopted a competitive market in which multiple entities battle for licenses and market share. For perspective, Pennsylvania had iGaming revenue of $92 million in December alone, generating over $35 million in state and local tax proceeds. These states have been handsomely rewarded for the decision to offer a cutting-edge array of products, as evidenced by their tremendous increases in revenue. But perhaps most important is the consumer — who enjoy better services with better payouts through competition.

The Delaware Lottery’s recent announcement to select a new vendor for iGaming, and the potential to expand into online sports betting, has created excitement in the industry — is Delaware ready to leave its woefully aged system of parlay cards, retail sports betting, and bland run-of-the-mill iGaming options behind? The answer, unfortunately, is still unclear. But they should certainly think twice before sole-sourcing the entire contract to a single vendor again.