May 14, 2020 Casino, Online, Land-Based

Analysis: New Jersey online gains send clear message to US gaming industry

By

It beggars belief there is still industry opposition to online gaming in the US.

I have always been fascinated by the Coalition To Stop Internet Gambling. My understanding of it, however accurate or inaccurate it may be, is that it is designed to preserve the revenue of land-based casino operators against a rising tide of online gambling.

As was discussing at a recent industry panel, retail operators have often seen online as the "enemy."

But how self-defeating is something like the Coalition To Stop Internet Gambling at a time like this?

While the coronavirus pandemic has brought many industries to a halt the world across, land-based casinos have been heavily impacted. Online casino, however, is a service that has continued to entertain players unabated during the COVID-19 crisis.

In Europe, affiliates and operators have spoken of a silver lining to an overall decline in gambling revenue through increases in esports, virtuals and poker. But the biggest volumes of all have come from online casino.

In New Jersey, meanwhile, that much was proven with the release of April’s financial report by the Garden State's regulator.

With the main headline being a record fall in overall revenue in Atlantic City, online gaming figures more than doubled to a record $80m in revenue.

Online poker, too, tripled to a record $5.2m, but the star of the show was online gaming by far; which saw huge rises ranging from a 62% year-on-year increase for Tropicana to a 267% yearly rise for Ocean Casino.

Even during a pandemic, these numbers speak for themselves. It’s a clear message to all retail operators to put aside any allegiances and, rather, utilize the digital options now available to them in abundance.

For states outside the very few that have already regulated online gaming, it should also serve as yet another wake-up call that here is a strong source of growing revenue, ready to be offered at a time when state tax levels are more important than ever.

Admittedly, there are considerations that cannot be ignored. Introducing a new way for customers to lose money during a time of crisis may not be publicly welcomed.

Governments undoubtedly have plenty of other priorities to address at this time, too, while responsible gambling concerns will naturally be higher due to what is considered the riskier nature of online casino.

But these facts still remain:

1. Sports betting recently launched in Colorado, showing states can move forward with new verticals even during this pandemic.

2. Online gaming is a source of revenue on the up for both gaming companies and state governments, while land-based revenue is more or less on hiatus.

3. Online gaming on illegal websites continues to thrive, meaning the vertical takes place anyway, without regulated operators and state governments seeing the benefits.

4. Responsible gambling tools are more readily available online due to advanced software and technology, meaning AML and age verification are far more effective in a digital environment. Pretending there aren't already huge, safely regulated online casino markets around the world is simply living in ignorance.

So, even if hopes of new online gaming markets on my part might be ambitious, at the very least those in existing markets should put their digital prejudices aside.

Right now, the Coalition To Stop Internet Gambling may as well be to Coalition To Stop Gambling Altogether.

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