Online Gambling Does Not Hurt Brick and Mortar Casino Business

March 19, 2014
Online Gambling Does Not Hurt Brick and Mortar Casino Business

One of the biggest myths of iGaming is that it hurts brick and mortar casino business. The general idea is that if people can play at home they won’t need to visit casinos and jobs would be lost. The sentiment from iGaming North America panelists was clear, this is not the case.

In the first panel of the day, Senator Raymond Lesniak from New Jersey stated that Chris Christie signed the New Jersey iGaming bill to help save struggling Atlantic City casinos. With online gambling revenue, brick and mortar casinos would have a better shot of staying open and keep land-based jobs that were potentially at risk. Although this didn’t help Atlantic Club Casino-Hotel, many other struggling Atlantic City casinos are hoping online gambling can help them return to profitability.

Mitch Garber CEO of Caesars Interactive Entertainment was very clear that online gambling does not hurt brick and mortar casinos and in many cases, it’s two different types of clientèle. He pointed out that the next generation of casino players will want to play online. Casinos need to cater to where the players will be, and he believes that iGaming compliments brick and mortar casinos. He also mentioned that when internet gaming was at it’s highest in the US and UK, land-based casino revenue was as well.

In the last panel of the day Chris Sheffield, managing director of Betfred, said that he sees no cannibalization between online and offline gaming. Betfred currently operates 1,378 store locations in the United Kingdom as well as an online casino, sportsbook and poker site. If Betfred and other UK gaming companies aren’t feeling negative effects of online gambling in a mature UK market, then it’s likely to be similar in the United States.

New Jersey iGaming revenue has not been as high as expected, but this was due to geolocation, credit card processing problems and, in Lesniak’s words, “amateur advertising”. They aren’t worried about online casinos replacing their brick and mortar. Instead they complement it. The panelists throughout the day agreed with the notion and it’s hopefully one less argument to be made against iGaming in future states.

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