Online Poker Outpaced by Internet Casino Games, Report Says

Online casino revenues are growing in New Jersey, but online poker is sluggish. (Image: bizmology.hoovers.com)

Offering online poker by itself rather than along with casino games is often seen as a more politically palatable option for states, but it may not be the smartest move in the long run.

That’s one of a number of conclusions reached by a new report from GamblingCompliance (GC), which has found that in one state that offers both types of online gambling options, casino growth has far outpaced that of poker, something other states are likely to notice.

The GC report, titled US Internet Gambling In Focus: 2014 and 2015, found that New Jersey online casino revenues have jumped 93 percent on a per capita basis since the sites first opened in December 2013.

By contrast, online poker revenues could charitably be called “static,” as they’re actually down 29 percent over the same period. These are the kinds of numbers that are likely to make waves as more states consider online gambling legislation in the years to come.

“In 2015, we expect the significant growth disparity between New Jersey Internet casino win and Internet poker win to be a key talking point in states that are weighing whether to legalize Internet poker, only,” the GC report stated. “In 2015, we expect California, New York and Pennsylvania…to be among such states.”

Poker-Only Still Likely in California

That doesn’t meant that states won’t still opt for the “poker-only” approach in some cases. After all, that’s likely to be the option most attractive to California at the moment, one of the few states with a population base large enough to undoubtedly support several active online poker sites. According to the GC report, a poker-only online gambling framework could generate between $217 and $366 million annually in California.

The GC report took a look back at what happened in the online gambling world in 2014, and looked ahead to what could be coming in 2015. Last year, nine states saw legislation introduced that would authorize online gambling or (in the case of New Jersey) amend existing laws. GC expects that trend to continue, predicting that between eight and 11 states will consider such legislation this year.

Of course, that doesn’t mean that any of these states will actually pass such bills, and the report expresses plenty of uncertainty over whether any of them will. In GC’s “base-case” scenario, they expect one state or jurisdiction to approve online poker or gambling legislation this year, with the most likely suspects being California, Pennsylvania, or the US Virgin Islands.

A more optimistic bull-case scenario would see two states to pass legislation, perhaps including a less-likely state such as Iowa jumping into the mix, while a bull-case scenario would see no new states joining the Internet gambling fray.

Report Says RAWA Won’t Pass in 2015

However, there’s good news for online gambling supporters in any of these scenarios: GC projects that under no circumstances will the Restoration of America’s Wire Act (RAWA) or any other federal online gambling ban pass in 2015. However, they do acknowledge that this prediction will have to be revisited in 2016.

“Federal consideration of Internet gambling tends to occur late in the second year of each two-year session of Congress,” the report stated.

GC predicts that RAWA will still be the largest issue in the American online gambling landscape for this year, even if it has virtually no chance of being enacted into law.

“Perhaps the biggest question facing US Internet gambling in 2014 was: Can the industry be effectively regulated?” the report said. “In 2015, the biggest question…may not be regulatory or technological, but instead political.”

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