6 Changes Worth Noting In 6 Years Of New Jersey Online Gambling



As the New Jersey online gambling market celebrates six years, we take a look at the six biggest changes to the market since those early days.

New Jersey online casinos opened for business with seven casinos and six online poker rooms in a coordinated launch on Nov. 21, 2013.

But it took a little work and almost three years to get there.

Protecting Atlantic City casinos, adhering to the Wire Act, and educating the public about what online gambling really meant, resulted in a veto and rewriting the legislation.

Eventually, a bill legalizing online gambling in New Jersey was approved in a bipartisan effort on Feb. 26, 2013.

Former-Gov. Chris Christie followed with his signature, making New Jersey the third state to legalize online gambling behind Delaware and Nevada.

New Jersey may have been third to legalize online gambling, but it is the state other states look to for guidance in crafting legislation.

As the New Jersey online gambling market celebrates six years, we take a look at the six biggest changes to the market since those early days.

1. Size matters when it comes to NJ online casinos
On Nov. 21, 2013, seven online casinos and six online poker rooms began a weeklong testing phase. Five days later, all 13 were approved for full-time operations.

Today, New Jersey is home to:

23 online casinos
Seven online poker rooms
17 online sportsbooks
The first year of operation saw a limited number of games and technical challenges that slowed down the industry’s initial growth.

Six years later, the Division of Gaming Enforcement (DGE) is a well-oiled machine. Online casinos, plus the technology involved, have advanced tremendously. While technical glitches still happen, they are usually short-lived.

During December 2013, the first full month of operation, the online gambling market earned $7,388,672.

Compare that to today. In October 2019, the latest NJ online casino revenue numbers available, online casinos generated $45,214,555 of income.

Since the launch of online casino gambling, the industry brought in $1.4 billion and the state benefited to the tune of $2.1 million.

In 2019, seven out of the 10 months produced record revenue, the most recent record-setting month coming in October. Even more impressive is the massive year-over-year growth of 69%.

Last year at this time, many people started asking the question, when will the online casino market stop growing?

Well, 2019 is not the answer. By the look of things, neither is 2020.

2. Live dealer games liven up online casinos
Live dealer games in New Jersey are probably the biggest innovation to online casinos over the years. Golden Nugget online casino first launched live dealer games in August 2016.

In those days, Golden Nugget offered one table each of:

Blackjack
Roulette
Baccarat
Betfair Casino, under the Golden Nugget license, was the next online casino to offer live dealer games in May 2017.

It was almost another year before Borgata added live dealer games to its casino portfolio.

Bringing the experience and excitement of the casino floor to online sites was a gamble that paid off big time for Golden Nugget.

That addition is often credited for catapulting Golden Nugget to market leader, a position it still holds today.

Today, players can enjoy more games at more NJ online casinos, including:

Baccarat
Blackjack
Casino hold ’em
Roulette
Three-card poker
Live dealer games are as popular today as they were three years ago when they first came into the market. A majority of websites in the state now have a live dealer library.

They are a must if an online casino wants to make it in the highly-competitive New Jersey market.

3. NJ sports betting’s impact on online gambling
There is no doubt one of the biggest changes to online gambling in New Jersey was the introduction of NJ sports betting apps.

When online sports betting launched in August 2018, online casino gambling was hovering around the mid-$20 million range. Since January 2019, online casinos in NJ have not posted revenue of less than $30 million.

Yes, some of that is due to innovations like new games and new online casinos such as:

BetAmerica
Unibet NJ
Bet365 Casino
Parx Casino
However, a lot of that revenue can be attributed to online sports betting and bringing new customers into the casino.

Additionally, a shared wallet between the sportsbook, casino and poker sites has helped companies such as DraftKings make a bigger splash on the market.

It is now easier than ever for a bettor to take a slot out for a few spins while watching and betting on a game.

Speaking of DraftKings, the successful pivot from daily fantasy sports (DFS) to sports betting for DraftKings Sportsbook and its DFS-turned-sportsbook rival, FanDuel Sportsbook, is also worth noting.

Both companies had a strong brand presence and access to a large database of customers with a history of betting on fantasy outcomes.

It is certainly easier to convert a fantasy player to a sports bettor to a casino gambler than it is to acquire a brand-new customer without a history of gambling online.

There is no doubt that legal sports betting in NJ is one of the main reasons online casinos continue to set revenue records in the Garden State.

4. Cross marks the sweet spot
Cross-selling, cross-border traffic and casinos crossing into the Garden State has certainly dominated the headlines over the last year.

It seems everyone, and that includes players and gambling companies, wants an invite to the party in New Jersey.

As a way to expand their reach, we’ve seen SugarHouse Casino cross the Pennsylvania border into NJ to set up shop — even before online sports betting was available in the Garden State.

More recently, Parx found its way across the border. After six years of online gambling, and still the NJ market continues to grow at a double-digit pace, is too enticing not to want a piece.

Even Native American tribes are getting in the action. Specifically, the Pala Tribe from California and Mohegan Sun Tribe from Connecticutoperate casinos in NJ and have since the early days of online gambling.

We touched on the importance of cross-selling between sportsbooks and casinos above, but now, FanDuel and DraftKings are cross-selling their product between:

New Jersey
Pennsylvania
Indiana
West Virginia (DraftKings only)
One app, one account and one wallet that geolocates you to the state your in and provides you gambling options in that state.

It’s true, Indiana has not legalized online casinos yet. West Virginia has legalized them but has not launched them.

Even so, setting up the infrastructure to cross-sell products across borders will be a key to the success of online betting apps in the future.

When sports betting first launched, New Jersey benefitted from the lack of legal sports betting in the region. Bettors from New York and Pennsylvania would head to the nearest truck stop on the border to place their bets.

While New York is still not online, Pennsylvania is. Will cross-border traffic decline? It is too early to tell, but it most likely will to some degree.

Even so, there are still enough bettors without access to sports betting apps in their states to keep cross-border traffic as a contributor to online gambling revenue.

5. Partnerships, mergers and consolidation, oh my
While partnerships and mergers existed before the launch of legal sports betting in the US, the deals accelerated as more European companies moved into the US market and the sports leagues looked to capitalize on a new revenue stream.

With 23 online casinos and 17 online sportsbooks, we already see the consolidation of the majority of income within a few brands.

In October 2019, the top two online casinos generated as much income as the entire NJ online casino market in October 2018. Sportsbooks show a similar story.

As income starts to consolidate, company consolidation will certainly follow. In fact, we already see it with Flutter’s recent acquisition of The Stars Group (TSG).

And in case you forgot, Flutter was the result of a merger between Paddy Power and Betfair, which acquired FanDuel in 2018.

The other news dominating headlines are the latest partnerships between gambling companies and:

Media outlets
Advertisers
Sports leagues
It’s not just big deals with big names, either. FanDuel signed a deal with the NHL, not for sports betting but for DFS. The Stars Group has a sponsorship deal with the UFC.

Deals are being signed at record speed. It is changing how companies evaluate markets and prepare for online gambling launches.

Take the recent Yahoo and BetMGM deal.

Yahoo, a media company, rolls out an NJ sports betting app powered by BetMGM. While technically, Yahoo is sending the customer to BetMGM; from a customer perspective, Yahoo has a sportsbook.

Two years ago, that would be crazy talk. Six years ago, there would be plenty of incredulous laughs. Today, we barely bat an eyelash.

Word of caution for those gambling companies taking a wait-and-see approach. If they wait too long, they will likely be left out in the cold.

6. Gambling as entertainment is more widely accepted
It wasn’t that long ago where someone might be ashamed to admit that they spent a day in a casino. Or worse, spent a few hours online playing the slots.

Today, more Americans accept gambling as a form of entertainment.

According to a survey commissioned by the American Gaming Association (AGA), nearly half of all Americans think of the casino industry favorably and two-thirds think casinos are a form of high-quality entertainment.

Additionally, 49% of those surveyed believe casinos are beneficial to their local communities. Specifically, they contribute to the local economy and create jobs.

It is those numbers that are driving more states to bring online gambling legislation to the table.

“The favorability of our industry has never been higher,” said Bill Miller, president and CEO of the AGA.

“As gaming expands across the US and more Americans engage with our industry’s offerings, they see firsthand gaming’s positive impact on local economies and its value as a community partner.”
NJ online gambling is just getting started
Looking at this list of six changes to online gambling over the past years shows the potential for the next six. As more states come online, we can expect to see more growth, more innovation and yes, more healthy competition, too.

The percentage of Americans that look favorably on the industry will grow, as will the number of Americans that visit a casino, whether online or in person.

So, here’s looking at you, New Jersey. May you continue to lead the charge. We can’t wait to see what the next few years bring.


This article is a reprint from NJGamblingSites.com. To view the original story and comment, click here


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