Online casino gambling is currently legal in only seven states and has been slow to expand. iGaming operators won $6.17 billion from players in 2023, compared to $10.92 billion in revenue generated by online sports betting, which added five states in the year alone, according to VOA News.
Speaking earlier this month at the SBC Summit North America on Wednesday, prominent figures in the gambling industry recognized the challenges they have faced in advocating for the expanded legalization of iGaming.
Nevertheless, the industry leaders are convinced online casino games are where the future of gambling lies.
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iGaming the Future of Gambling But Not Expanding As Quickly
Many industry leaders present at the SBC Summit North America, a prominent yearly conference for the gambling sector, believe that online casinos are the way to go.
Elizabeth Suever, a vice president at Bally’s Corporation, echoed this viewpoint. She confirmed that the millennial generation is noticeably inclined towards efficiently handling various aspects of their lives through mobile devices. As such, this trend is shaping the future of the gaming industry.
This sentiment echoes broader societal shifts. Digital experiences have permeated nearly every facet of modern life, from commerce and entertainment to communication and productivity.
However, industry execs say online casino gambling has been painfully slow to expand. As of this writing, only seven states—New Jersey, West Virginia, Rhode Island, Michigan, Delaware, Connecticut, and Pennsylvania—have legalized internet-based casino games.
Nevada, which has legalized online poker platforms, is yet to sign off on legal iGaming. That means both iGaming and sports betting are legal in New Jersey and only six other states.
This patchwork of regulations is part of the challenges operators, and regulators face when pushing for the expanded legalization of online casino games.
Sidestepped by Online Sports Betting
Unlike iGaming, online sportsbooks and mobile betting apps have experienced near-overnight popularity.
Thirty-eight states, along with Washington DC and Puerto Rico, now offer legal sports betting, with the overwhelming majority of wagers being placed via the internet, primarily through mobile devices. In 2023, the sports betting operators brought in a little shy of $11 billion, a 44.5% uptick from the record revenue generated in 2022.
More interestingly, the online sports betting industry added five states to the legal roster. The newcomers —Ohio, Nebraska, Massachusetts, Maine, and Kentucky— generated nearly $1.5 billion in combined revenue in their debut year, according to Forbes Magazine.
Shawn Fluharty, a West Virginia lawmaker and president of the National Council of Legislators from the Gaming States, was impressed by the rapid expansion of sports betting. He observed the legalization of sports betting by the US Supreme Court in 2018 resulted in a significant increase in bets received by sportsbooks.
Fluharty was quick to add that while many expected online gaming to experience a similar surge, that has not been the reality. He is not wrong. In New Jersey, for instance, sportsbooks accepted over $12 billion worth of wagers from sports bettors in 2023, while the combined revenue generated by online casinos was $1.89 billion.
Brandt Iden, a Fanatics Betting & Gaming vice president, agreed with Fluharty’s remarks. He said that expanding iGaming has been challenging but is paramount for the success and future of the entire industry.
A Promising Future for Atlantic City
Last month, Deutsche Bank issued a research note suggesting that it is likely a matter of “when not if” internet gambling revenue in Atlantic City surpasses that of physical casinos.
This projection is rooted in the growing prevalence of digital experiences across various sectors, coupled with the inherent convenience and accessibility of internet-based platforms.
Diverging Viewpoints on Cannibalization of Brick-and-Mortar Casinos
Rob Norton, president of Cordish Gaming, which operates both physical casinos and internet gambling operations, has emerged as a vocal critic of online gambling’s potential impact on traditional casinos. He cautions that casino operators are setting themselves up for the industry’s failure.
Norton cited a 65% decline in in-person sports betting revenue at the company’s Maryland Live! Casino following the introduction of mobile sports betting in the state, with daily visitor numbers decreasing by approximately 7,000 individuals.
In Norton’s view, this may partially explain why online casino games have yet to gain broader acceptance. He noted that eight states considered internet gaming last year, but not a single one passed legislation.
Countering this perspective, Adam Glass, an executive at Rush Street Interactive, an online gambling company, emphasized his firm’s collaborative relationships with physical casinos. He stated that iGaming can serve as a job creator, not only in game design and operation but also in ancillary industries like marketing and media.
Adam’s viewpoint suggests that the online and offline segments of the gambling industry can coexist and potentially complement one another, with online platforms serving as a driver of growth and innovation within the broader ecosystem.
Quincy Raven, the US managing director of NeoGames Group, a technology platform company recently acquired by Aristocrat Leisure Limited, offered a nuanced perspective. He suggested that what may appear as cannibalization of traditional casinos to one entity could be viewed as successful competition by another company gaining market share by catering to changing consumer preferences.
Wrapping Up: The Future of Gambling Remains Online
Despite the challenges and debates, the overwhelming sentiment within the industry is that the future of gambling lies in online platforms. As consumers, particularly younger generations, increasingly embrace digital experiences, the transition towards internet-based casino gaming is poised to accelerate in the years ahead. The convenience, accessibility, and immersive nature of online gambling align seamlessly with the preferences of tech-savvy demographics, positioning this segment for sustained growth and mainstream acceptance.
However, the path toward widespread legalization and adoption of online casino gambling will likely remain complex, requiring ongoing efforts to address regulatory concerns, assuage fears related to responsible gambling, and navigate the evolving landscape of competition within the industry. Ultimately, the successful integration of online and offline gambling experiences may hinge on the industry’s ability to adapt, innovate, and effectively communicate the benefits and safeguards associated with regulated internet-based platforms.
