Quick, name the most successful gambling launch in history.
It’s not sports betting. Nor is it Powerball, Mega Millions, or any other lottery.
It’s igaming, that unseen quiet form of gambling that can be done remotely on laptops, tablets, and smart phones from coffee shops, bars, or anywhere else with an internet connection.
“Igaming has been the most productive revenue generator of any gaming launch in history,” said Light & Wonder Head of Government Affairs and Legislative Counsel Howard Glaser Monday at the Global Gaming Expo education session, “What’s Next for Legal iGaming in the United States.”
Glaser based his assertion on facts and the treasure trove of revenue produced by igaming in just Delaware, New Jersey, Connecticut, Pennsylvania, Michigan, and West Virginia. Over the last six months, the six states have combined for $5.7 billion in revenue, yielding $1.5 billion in tax revenue.
Statistics indicate igaming does as well as, if not better than, other gaming verticals. In July 2023, sports betting had a GGR of $500 million, the same amount as igaming. But sports betting’s revenue came from 36 states compared to the six states where igaming is available. During the same period, slot revenue from every commercial casino in the U.S. was $1 billion.
“It’s taken 30 years for casinos to build that business and, really, ten seconds on the evolutionary scale of gaming to have igaming GGR of half of that,” Glaser said. “That gives you a sense of what the power is in terms of the performance of igaming.”
It’s likely that igaming will eventually become available in more jurisdictions. But until then, operators have to deal with patrons who are increasingly comfortable conducting their transactions online.
Anika Howard, president and CEO for Wondr Nation, said that more regulations in the igaming vertical are inevitable and that igaming growth must be implemented responsibly with player protections.
“Right now, digital, from a player perspective, is an expectation,” Howard said. “There are all of these things you can do in your traditional life with your mobile phone, so players don’t necessarily understand that there are all of these challenges. What they see is that they can buy coffee from Starbucks on their cell phone and check all their really important financial transactions, from investments to banking, online. So why not igaming?”
With the possibility of financial windfalls and jurisdictions considering the legalization of igaming, one risk needs to be considered. Justin Cosnett, chief product officer for the London, England-based Continent 8 Technologies, said that the potential harm and risk for players are enormous without built-in safeguards that address problem gambling.
“If you want player protection, you need regulations or you’ll have even more potential for harm, potential for risk,” Cosnett said. “Because you’re basically establishing an even better open market, so that responsible gaming goes hand in hand with regulation that you set up. And then it’s how that jurisdiction wants to police its operators and make sure that they do and don’t operate in certain ways tied to that kind of prevention.”
Glaser, Howard, and Cosnett agreed that the spread of igaming is inevitable. Glaser mentioned that all it could take for legalization is for a state to suffer a financial crisis, then determine that igaming is a way to enable a fresh source of revenue.
“If you want to know which states are going to be next, tell me which states are going to run out of revenue in terms of their annual budgets,” Glaser said. “A big piece of what has been a drag on igaming adoption is the $293 billion that the federal government made in direct payments to states because of COVID. That money made states flush, but that money is starting to run out this coming fiscal year. States that have been cash positive are starting to go cash negative and it gets worse in 2025. Legislators are uncomfortable when they suddenly need to fund a budget hole and then they’ll pull igaming off the shelf.”
Glaser added that in New York, tax revenue could be $1 billion and it’s close to that in Illinois. And igaming is a revenue source that doesn’t require raising taxes.
“I don’t know any other industry that goes to a state, a governor, and says please regulate us and tax us, and we’re happy to have that conversation with them,” Glaser said.
