On 28 December, DraftKings quietly launched a new subscription service, dubbed DraftKings Sportsbook+, for select customers located in New York. The new service, which allows for odds boosts on parlays, is the first of its kind–and it could be the company’s tax saviour. But will bettors actually subscribe?
Essentially, Sportsbook+ allows subscribers to get better odds on parlays. Each applicable parlay must be at least two legs, and each leg must have odds of -500 or narrower. For each leg added to the parlay, the odds would be improved by 10%. In other words, a two-leg parlay would be boosted 10%, a three-leg bet would be boosted 20%, and so on. Parlays with 11 or more legs would be boosted by 100%, or double the original payout. The maximum applicable bet is $25.
The news of the launch was first reported by Sportico 3 January.
DraftKings said the service would be available to “select, eligible customers” in New York, but didn’t elaborate on specific criteria. The fact that it was launched in New York is likely an indication that the bookmaker is making another attempt to lessen its tax burden in big markets. New York is the largest online wagering market in the US by handle and tax revenue, but its 51% tax rate is often criticised.
One big question is whether the money from the subscriptions would be considered taxable gaming revenue. The state regulator confirmed to iGB today (7 January) that it is not.
“DraftKings has been granted Commission approval for the subscription plan,” said Brad Maione, director of communications for the New York State Gaming Commission. “The subscription revenue is not subject to New York taxes on mobile sports wagering. However, wagers are taxed at the established rate.”
One of many levers to pull
Sportsbook+ is not the first attempt by DraftKings to lessen its tax burden. In August, the company announced and then quickly nixed a surcharge on winning bets in Illinois. That plan came in response to the introduction of a higher, tiered tax framework in the state, which is also among the top performers in the US.
The idea of a surcharge drew the ire of the betting world and ultimately no other bookmakers followed suit. But the company did say at the time that it had other options to pursue and levers to pull. This appears to be one of those options.
“We’re constantly communicating with our customers to understand the products they use and love in their daily lives, and exploring how we can apply those insights to DraftKings,” the company’s chief product officer Corey Gottlieb said in a statement. “This process led us to developing a low-cost, recurring subscription designed to provide customers with exceptional value. As we test this new offering, we’ll refine our approach in order to provide the most engaging customer experience.”
In addition to the added revenue, the subscription service also drives more bettors toward parlays. Parlays have become the backbone of the modern sports betting business, especially for major operators like Flutter and DraftKings. According to data from Pikkit, an app that lets players sync wagering accounts and track bets, parlays accounted for 50% of all the 323 million bets it tracked in 2024. Approximately half of all parlays were same-game parlays, where there are multiple bets on one contest.
A value proposition
It remains to be seen whether Sportsbook+ will be embraced or ridiculed by the betting community. Wagering is still slowly creeping into the mainstream of US culture, and subscription memberships are another step in that evolution. According to research from Bango, the average American has 4.5 subscriptions and pays just under $1000 per year for them. The name even has the requisite “+” at the end.
But there’s still no guarantee that bettors specifically will buy into the new idea. As with any subscription service, value (or perceived value) is key–theoretically, subscribers could be paying $20 per month just to lose more bets. Conversely, one hit on a lucrative parlay could pay for the service and then some.
In some ways, Sportsbook+ speaks to a broader question of just how much consumers can get for $20 per month, which DraftKings considers to be “low-cost.” Here are some other types of memberships or services in today’s marketplace around the same price:
Water bills
This first example is more a necessity and extends beyond New York, but the price comparison is still worthwhile. According to This Old House, the average monthly water bill for Vermont and Wisconsin residents is $18. Several other states–including North Carolina, Louisiana, Nebraska and Mississippi–are within a few dollars of that.
Streaming services
Nearly all US households subscribe to at least one streaming service for entertainment. The current monthly pricing for some of the top platforms is as follows:
- Netflix: Standard with ads- $6.99/ Standard- $15.49/ Premium- $22.99
- Hulu: With ads- $9.99/ Ad-free- $18.99
- Disney+: Basic- $9.99/ Premium- $15.99
- Apple TV+: $9.99
Gym memberships
Given that it’s January, gym memberships are still in high demand. Sample rates from some of the biggest chains include:
- Planet Fitness: Classic- $15/ Black Card- $24.99
- 24 Hour Fitness: National- $22.99/ Platinum- $27.99
- Gold’s Gym: Basic- $14.99/ Passport Club- $24.99/ Passport Gold- $29.99
Moving forward, Sportsbook+ subscribers could be early adopters for a new wave of products that bookmakers come up with to help with rising tax rates in a business with traditionally slim margins. This is especially true if regulators in other states agree that that revenue is not subject to gaming tax.
Or bettors may just decide that a good workout followed by a hot shower and an episode of their favorite show is much better value.