NJ Gambling in Healthier Place Post-iGaming Regulation

Home » Poker News » NJ Gambling in Healthier Place Post-iGaming Regulation

Thursday, July 13th, 2017 | Written by Lucy Brown

Since its beginning, New Jersey’s online gambling market has helped to buoy the state’s casino industry, as well as its overall economic standing, whilst also creating a safe place for people to gamble online. This is exactly the positive message that the i-Development and Economic Association (iDEA) has been trying to convey to legislators everywhere across the country, and the information that follows is the main findings of a recent study performed by Gene Johnson of Victor-Strategies and Alan Meister, Ph.D., of Nathan Associates.

Benefits for Atlantic City Operators

From 2006 until 2013, Atlantic City had been dealing with a decade long downswing until online gambling helped revive much of its beleaguered market. After it helped stabilize the land-based casino industry in 2014, online gambling subsequently helped Atlantic City turn over a new leaf in 2016, with the 0.4 percent increase in revenue recorded marking the first such increases since 2006. This was all in spite of the fact that four land-based casinos shut shop in 2014.

Online gambling was also able to account for around 8.9 percent of the state’s overall gambling market in 2016, and furthermore, the study sees that figure growing by at least 10 percent later this year. Highlighting this point, so far in 2017, online gambling has brought in more revenue than three of the land-based casinos based in New Jersey combined.

Needless to say, the study goes on to show that online gambling has had a huge impact on land-based gaming in a positive sense. One way that it does this is by enabling a casino to better understand and measure the number of new customers it is attracting across different channels, thereby providing it with the means to help grow revenue in the future. One piece of evidence already provided by land-based operators includes a report from Caesars Interactive Entertainment which cited that “80% of its online registrants are new players.. and another 8% are inactive players at one of the company’s three Atlantic City casinos.”

Benefits for the State

The good that online gambling has brought to Atlantic City is nothing compared to what has been done for New Jersey as a whole. In terms of taxes, online gambling generated $34.5 million dollars in 2016 alone, and this study projects that this figure will rise and hit $40.3 million by the end of 2017. Moreover, this all comes without any sort of burden on taxpayers. Meanwhile, an additional 3,374 full-time jobs have been created by the industry since online gambling was regulated. wages have increased, too, and last year $218.9 million was earned by employees via either a direct or indirect consequence of the gambling industry.

As a result of its evident success, other US states have now started studying the benefits online gambling has provided for New Jersey in the hope of replicating its success for themselves. States that are currently examining the option include Pennsylvania, which has predicted around $426.3 million in taxes from 2017 until 2022 in the eventuality of legislation passing. Illinois has also come up with some hugely optimistic numbers, having projected $266.5 million in taxes over the first five years that online gambling goes live. It is no therefore no surprise that groups like iDEA are coming together to “exclusively represent the interests of the online gaming industry in the United States,” and help shed a positive light on the significant benefits of the industry.

$20M Plus Monthly Revenues in 2017

New Jersey has just released its latest results for June, with revenue soaring by a massive 23.4% to $20.2 million compared to the same month last year. June’s result now marks four months of consecutive monthly online gambling revenues in excess of $20 million, with the trend having first taken root in March when a record $21.7 million was generated from the industry.

Much of the credit, however, goes to the online casino segment which last month accounted for $18.5 million in revenue, up by 23.4% year-over-year. Meanwhile, poker continues to see its contribution shrink, with the $1.73 million collected in June down by 11.9% y-o-y, and representing a historic low for the market. The positive impact from online gambling regulation has also helped New Jersey overall gambling industry see its revenue increase by 11.1% so far this year, and as NJ Division of Gaming Enforcement director David Rebuck, explains:

“June’s report reflects continuing overall financial stability within the industry and increasing strength for internet gaming operations. Both factors are positive indicators of the Atlantic City casino industry’s ability to successfully perform in an extremely competitive regional marketplace.”