The Internet gambling revenue figures released by New Jersey regulators last week were encouraging, but they were off the mark with regard to annual projections.
The $8.4 million brought in by the Garden State’s 15 online gaming sites since the soft launch on Nov. 21 until the start of the new year would be less than $100 million if those same results played out over a 12-month period. That’s significantly lower than the $200 million to $300 million that analysts estimated for New Jersey’s igaming regime.
But a little more than one month of operation is not enough of a sampling to draw from for those who are hoping to put a label on whether or not the state’s online gambling endeavor can be branded a success. Industry experts are preaching patience with regard to growth and expect numbers to improve as time marches on.
“Everybody needs to take into consideration that this industry is in its infancy,” Tropicana Casino and Resort president Tony Rodio told AP. “You’ll see this grow quickly.”
Player accounts now total over 155,000, with those numbers climbing every week. Increased marketing efforts are likely to attract even more players, with much room for improvement considering New Jersey’s sizable population of more than nine million. Players from neighboring states who also happen to visit the Garden State are being targeted as well.
A primary hope of state officials is that the online market will create new gamblers as opposed to the land-based casinos losing regular customers to Internet offerings. The early numbers suggest that land-based revenue will not be cannibalized to a great degree.
“Slightly more than 50 percent of our online customers were not regular customers at the Golden Nugget or were not customers at all,” said Thomas Winter, Golden Nugget’s online gambling vice president. Projections over the long term are in the 60-70% range that Internet gamblers will not come from those that are regular casino-goers.
Should that play out over the long haul as expected, it will likely prompt other states to get in on the game with their own online gambling regimes. Some states are currently hesitant about advancing Internet wagering for fear that it will cannibalize land-based gambling revenue.
According to Macquarie Capital analyst Chad Beynon, the New Jersey igaming market will “grow to $200 million to $300 million by 2015,” which is what Governor Chris Christie and other state officials are counting on. Brick and mortar revenue is expected to be cannibalized by some $25-$50 million, a total that will clearly be offset by online gambling proceeds.