Gaming regulators and New Jersey state officials issued a 10-page report that assessed the first year of regulated online poker and gambling, with an optimistic look at some key areas that hint toward a bright future for the Garden State.
Under the title of the “New Jersey Internet Gaming One Year Anniversary – Achievements to Date and Goals for the Future,” the report summarized the struggles encountered in year number one of its igaming regime. Along with those struggles came accomplishments and lessons learned that will likely soon lead to putting some new strategies into play that will benefit the bottom line.
The Internet gaming letter was prepared and released by New Jersey Division of Gaming Enforcement Director (DGE) David Rebuck. Dated January 2, 2015, the report points out that 506,172 accounts were created by online gamers in New Jersey since launching in late November 2013 through the same month in 2014.
Players from those half-million accounts were responsible for the state’s igaming revenue reaching $120.5 million in the first year of operation. It could have been more, but revenue totals were lessened due to financial institutions shunning some credit card deposit attempts. That is expected to improve this year.
Credit Card Code to be Implemented in Spring 2015
The success rate of credit card deposits at NJ gaming sites was pegged at 73% for Visa cardholders and 44% for players using Mastercard. Unacceptable numbers, of course, for a state that is fully regulated.
A solution is on the way in the form of a credit card code that will permit financial institutions to both identify and accept deposits made via both those credit card options. The DGE has communed with representatives from the New Jersey Department of Banking and Insurance and the U.S. Office of the Comptroller of the Currency in order to establish a code that will be employed in a few months.
Once the credit card code is in effect, those credit card deposit success percentages should increase significantly.
Need for Partnership Agreements – Interstate and/or International
While discussions with state banking and finance officials is crucial to future igaming success in NJ, perhaps equally as important are talks centered around interstate and international compacts. The DGE report highlights the need for increased liquidity on the online poker tables, as ipoker revenue was but 25% of the state’s total take from online gambling.
That percentage came as a surprise to regulators, who readily admitted in the report that their belief prior to launching was “that online poker would predominate over slots and other online games.” The need to partner up with other ipoker regulated states is apparent, considering that New Jersey online poker projections fell short.
Talks have commenced with both Nevada and representatives in the UK, the Internet gaming letter stated. It is likely that 2015 will see more such discussions take place, with perhaps a greater sense of seriousness and urgency behind the negotiations.
A Multi State Internet Gaming Agreement is already in place between Delaware and Nevada, though that interstate compact has not yet been launched. Nevada Governor Brian Sandoval previously extended invitations to other states to climb aboard and we may see that happen during year number two of New Jersey’s igaming scheme.
While industry observers that include Morgan Stanley believe that online gambling license approval for PokerStars under Amaya’s ownership would boost New Jersey revenue considerably, the DGE chose not to address the subject in its report.
The report’s title stressed “Goals for the Future,” and many think that that future revolves around or at least includes PokerStars, but nary a mention was made to that effect. In any event, the Internet gaming letter put a positive spin on what lies ahead for NJ igaming via a new credit card code and possible interstate/international compacts.