The United States is enjoying a major boom in a fast-growing new industry – online gambling. Thanks to the loosening of online gambling laws and also to a certain COVID-19 pandemic, the industry is bringing in billions of dollars in revenue and more and more providers are popping up for a share of the lucrative returns.
There is certainly no confusion that revenues are going up high as increasing numbers of states are starting to open up online gambling options. The quarantining over the last 2 years of COVID has also had an impact in increasing the numbers of participants in online gambling – and therefore the revenues generated by it.
The pandemic affected the industry in a big way as casinos and other venues were forced to close their doors, whilst major and minor sports events also had to be suspended, leading to a sudden ending of in-person gambling options.
These restrictions generated an instant, overnight shift to online gambling, both in terms of face-to-face operators going digital with websites and apps and also in the form of a huge expansion in the amount of new online providers at a rate that is continuing still at a breakneck speed.
Online casinos were not legal in the States for decades until recent years – with a 2018 Supreme Court case deciding that individual states could make their own rulings on allowing the practice. Queue a huge increase in demand in those states from players and a similarly huge increase in revenues.
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US states enjoy huge revenues already
For example, in New Jersey more than 12 legal and licensed websites are competing in a market that is considered to be worth over $225 million – and that’s without adding sportsbooks and sports betting apps to the list.
NJ has enjoyed a 29.5% year-on-year increase in revenue since legalizing online gambling and so far this year total gambling revenue for the two months to the end of February was $755m. New York, meanwhile, also brought in its largest amount in a single month – $1.5bn was wagered in January alone.
And Michigan has also kept up an incredible pace. Last year the state became only the third in history to return over $1bn in annual revenue from online casino games and poker, and the first to do so in its first year.
Then there is Arizona where a combination of 12 online platforms and two casinos have been making over $40 million in after-tax profits per month, whilst Illinois is also reaping the rewards of opening up to legal online gambling.
Why is this trend rapidly increasing?
It is estimated that around 10 million US citizens regularly visit online casinos – and with the creation of new online casinos in different states the opportunities to take part in video-based live dealer poker, table games, and slot machines are endless.
The main plus point is accessibility – you can take part in online casino play from anywhere at any time on a smartphone, tablet or laptop. Furthermore, because there are hundreds of different providers each with hundreds of different games to play (some for free, some for real cash wins) and hundreds of different loyalty bonus programs, the sheer amount of varied options out there keeps gamblers coming back for more.
Obviously, the past two years have seen increasing COVID-19 regulations which have increased the number of online casino visits, increased revenue streams for the market, and increased tax returns for the state legislators.
Casinos in states where online gambling is permitted have enjoyed an increase in custom since the relaxation of laws in those states, and it is only a matter of time before more and more states are on board
What else can online casinos offer that’s different?
There are three major points that stand online casinos apart from the bricks and mortar offerings. They are better odds, a fairer ‘return to player’ percentage and, by and large, big payouts.
Many online casinos also provide sportsbook betting and when it comes to betting odds they are able to offer increasingly competitive odds, simply because they have to in order to compete with the more established online sports betting platforms in a bid to attract new customers and keep their existing customers coming back to use their service.
Meanwhile, the ‘return to player’ percentage which signifies the house edge and the average payout to winners and is very transparent when it comes to online casinos – most of which have a 99% RTP ratio in favor of the player. And because of this, online casinos are able to offer higher and more frequent payouts – especially the more players that take part.
What can online casinos bring to State legislators?
The presence of online casinos in states where the practice has been legalized has improved the revenues to those states beyond all expectations, improving infrastructure budgets and creating jobs.
Huge infrastructure projects such as buildings and transport have already benefited, and there has even been an increase in funding for gambling addiction charities. The success of online casinos has actually meant addiction can be supported on a state-funded level.
Meanwhile, online casinos have also provided a boost for job creation – covering everything from software development and marketing to customer support and live dealer roles. This increase in jobs can only benefit state economies further as more citizens are able to spend their wages – on top of the lucrative tax revenues that the online gambling industry brings to state budgets.
Finally, the very presence of legalized gambling is able to persuade players to stay away from black market websites which had previously enjoyed untold riches from the industry themselves – to the benefit of nobody else. With legal online casino revenue, as we have seen above, money can be used to benefit everybody.
What impact will online casinos have on traditional venues?
The increase in online gambling has unfortunately seen a drop in attendance at the traditional brick and mortar establishments but a lot of the businesses are actually developing their own online arms to compete in the market and grab a piece of the riches involved.
Of course, others are also developing their in-house offering to create a whole entertainment experience that gambling is only a small part of. Traditional casinos are still in demand and it is hoped developments such as this will allow them to still be relevant in the future.