Inside Asian Gaming

inside asian gaming JUNE 2015 32 Online Gaming [Initially] geolocation technology had trouble distinguishing borders and would automatically reject customers who launched a playing session at a location near state lines. “We believe in Internet gaming. I am not intimidated by it as a bricks-and-mortar operator… I do think that it is a business opportunity for MGM, and I think we are all kidding ourselves if we think it is going to go away.” James Murren Chairman and CEO of MGM Resorts International New Jersey Customer confusion —Affiliate marketing companies used by New Jersey iGaming operators often promoted unsanctioned web gaming sites along with those authorized by the state. Customers, unable to tell the difference, would play on these unlicensed sites. Poker bust —When iGaming legislation was passed in New Jersey, many thought Internet poker would be the primary beneficiary. This was not the case, with online poker games taking in a paltry $29 million in 2014. Much like the online casinos, the state’s poker networks were plagued by connectivity and payment issues. The inability of some of the larger established online poker networks such as PokerStars to clear licensing hurdles has also hit the industry hard, leading to a lack of overall liquidity and smaller jackpots which does little to entice online poker players away from better-funded sites. Whatever the reasons, the slow startup for New Jersey online gaming has caused a bit of a shakeout within the market. Two of the Atlantic City operators originally offering online gaming, Trump Taj Mahal and Trump Plaza, have since closed their sites. Ultimate Gaming, which had been affiliated with Trump Taj Mahal, also vacated the New Jersey iGaming marketplace. Betfair, which was tied in with Trump Plaza, shifted its operation to Golden Nugget but decided to drop its Internet poker service during the transition. With the loss of the Ultimate Gaming and Betfair sites, two New Jersey-based online poker networks remain in operation, affiliated with Caesars Atlantic City and Borgata. More problematic still, the less than expected online gaming results emanating from New Jersey have given renewed vigor to anti- Internet gaming crusaders. One such individual is Las Vegas Sands Chairman and CEO Sheldon Adelson, who has thrown his influence behind the Restoration of America’s Wire Act, a federal bill that would once again make online wagering illegal within the US. The measure failed to make it out of legislation last year, but many believe the bill will be re-introduced sometime this year. PATIENCE REQUIRED Despite the weak first-year results, there is still cause for optimism about New Jersey’s iGaming prospects. Five brick-and-mortar Atlantic City casino operators (Caesars, Borgata, Golden Nugget, Tropicana and, most recently, Resorts Atlantic City) currently host 15 Internet wagering sites. According to the Division of Gaming Enforcement, as of January 2015, these sites, which offer 423 authorized games, have a combined 506,172 player accounts, a 300% increase from the 126,231 accounts as of December 2013.