How Does NJ Sports Betting Market Compare to iPoker Segment?

How Does NJ Sports Betting Market Compare to iPoker Segment?

After New Jersey launched regulated online gambling in 2013, its online poker segment initially generated around a quarter of all the industry’s revenues, while online casinos accounted for the remaining amount. Since then, however, both verticals have been trending in opposite directions, with online casinos continuing to go from strength to strength, but online poker having now seen its overall share of the market shrink to a meager 7.5%.

Recently, the segment’s diminishing potential has been thrown into further relief following the launch of online sports betting in the Garden State, which in September produced almost the same amount of revenue as online poker has managed to do for the whole of the year so far.

Online Sports Betting Skyrockets

New Jersey launched regulated sports betting market in mid-June, and during its first full month of operation in July reported $3.8 million in revenue. Since then, the segment has recorded exponential growth, with revenue rising to $9.2 million in August, before more than doubling in September to an impressive $24 million. Furthermore, more than half of all wagers were made online, or around $12.6 million, while the rest was placed at the state’s land-based casinos and racinos. That percentage subsequently increases to a massive 62% via online platforms if results are included from the industry’s launch.

Needless to say, the seven operators currently offering online sports betting in New Jersey are finding their nascent enterprises exceedingly profitable. Leading the way in terms of online revenue is Resorts Digital Gaming on more than $8.5 million in September; followed a distant back by New Meadowlands Racetrack on $2.8 million, although including physically placed bets the racetrack reported a total of $7.2 million in revenue; and then the Golden Nugget on roughly $619k.

Needless to say, industry analysts, not to mention state coffers, will eagerly be anticipating October’s results, especially as all four major professional sports leagues are now in action, namely the NBA, NFL, MBL, and NHL.

How Does Online Poker Fare in Comparison?

By contrast, online poker has been left standing by the state’s nascent sports betting market. The vertical currently has just three online poker operations still offering their products, namely Borgata (partypoker), Caesars/Harrah’s (888, WSOP), and Resorts AC (PokerStars). These then managed to muster a combined $1,609,989 in online poker revenues in September, continuing a trend this year in which the vertical’s revenues have failed to exceed $2 million in any one month. Moreover, September’s iPoker revenue was barely more than the $1.6 million in online sports tax that was brought in by the segment last month.

Even more revealing is that New Jersey’s online poker market has generated around $16.4 million in revenue for the calendar year so far, a figure that is just $3.8 million more than what online sports betting generated in September alone. Unfortunately, online poker’s potential does not seem likely to improve any time soon, either, despite this summer becoming a part of a tri-state liquidity network alongside Nevada and Delaware.

In 2017, for instance, online casinos saw their revenues soar by 30.1% to $221.35 million, while online sports betting’s popularity, too, seems to be headed in a similar trajectory this year. Online poker, on the other hand, reported an 8.5% drop in revenue to $24.25 million in 2017, and has seen its revenue shrink consistently since posting a peak of $29 million in 2014, the year following the industry’s launch.

What Does the Future Hold for Online Poker?

It’s fair to say that despite initial enthusiasm concerning New Jersey’s online poker industry, the game is now being seen as less of any important direct money earner, and more of a means by which to draw new customers to its online gambling sites. This situation may change in the future if other states decide to launch online poker markets of their own and join a shared iPoker network alongside other regulated markets.

Just four states have regulated the industry since 2013, however, indicating that online poker has a long way to go before it convinces state lawmakers that its inclusion in their gambling expansion bills is worth the effort. Sports betting, on the other hand, has already been adopted in five states, aside from Nevada, with dozens of others now lining up to follow suit. As mentioned, however, online poker will still continue to be an important part of an online gambling industry’s overall product range, and in addition to the revenues its does generate, it can also help secure a solid and steady stream of customers to a market’s online websites.