New Jersey’s Regulated Online Gambling Market Still Growing: Hitting New Highs

New Jersey continues to serve as a case study showcasing the potential offered by legalizing and regulating online gambling in the USA. In January, the regulated online gambling market in New Jersey set a new all-time revenue record of $22 million for the month.

As a DGE press release noted, last month’s revenue total was 16.7% higher than January of 2017 and higher than any other month on record. Online casino games accounted for the lion’s share of that total with $20 million coming from “internet gaming” and just $1.95 million coming from online poker.

The Golden Nugget’s online operations counted for the largest single chunk of January’s revenue by generating $7.3 million all by itself. That set a new single-month record for the Golden Nugget and represents an increase of more than 50% compared last January.

New Jersey’s online gaming industry just keeps on winning even as the wider gaming industry saw a significant pullback over those same periods. According to the NJ DGE press release, the industry’s total gaming win for January 2018 was $184.3 million compared to $204.7 million for the prior January for a decline of nearly 10%.

Success in New Jersey Good for Legalization Efforts

Success in New Jersey is not only good for casino operators; it is also helpful for online gambling proponents in other states. Convincing lawmakers to change state laws becomes much easier when one can point to New Jersey as a model of successful, effective regulation and provider of significant tax revenue.

This is something proponents of online betting have been wanting to see for a long time. As the New Jersey, Delaware, Pennsylvania and Nevada markets mature without causing the sky to come crashing down, it becomes increasingly clear that legalization can be done responsibly after all.

Lawmakers debating similar bills in other states can look to the states that have already legalized online casino games, online poker or both as models for their own regulatory efforts. Lawmakers can also look at the different approaches these states have taken and see which approaches may be the most effective.

In Delaware, for example, three land-based operators have been granted a monopoly over online gaming and revenues have fallen year over year. Delaware’s total online gaming revenue fell to $2.4 million for all of 2017 for a decline of 18% compared to 2016.

By comparison, New Jersey’s total online gaming revenue topped $245 million in 2017. New Jersey has almost 10 times as many residents, so we cannot compare raw numbers, but the diverging trajectories in percentage terms is undeniable. Whereas New Jersey took the free market approach and flourished, Delaware has struggled under a government-enforced monopoly.

New Jersey Also Preparing for Sports Betting

New Jersey regulators and industry insiders are not letting themselves get too comfortable on the back of growing online gaming revenues. The Division of Gaming Enforcement confirmed on Thursday that it is ready to begin accepting sports betting licenses from interested parties even as we wait for a Supreme Court decision regarding the constitutionality of the federal sports betting ban.

Division of Gaming Enforcement director David Rebuck recently said the DGE “needs to be prepared to investigate and license businesses and individuals seeking to enter the New Jersey gaming market should the Supreme Court issue a favorable decision authorizing the state to legalize and regulate sports wagering.”

These comments followed comments he made earlier in February at an international gaming conference in London. There, Rebuck told attendees not to “sit back and wait for the regulations” if potential operators don’t want to be left behind. The implication is obvious: if the Supreme Court does indeed overturn PASPA, it probably won’t be long before New Jersey is ready to go live with sports betting.