Casinos in New Jersey, Delaware, and Pennsylvania were some of the first in the United States to provide legal online gambling solutions for in-state residents.
Even though the number of online gamers increased dramatically because of stay-at-home orders due to COVID-19, casinos in these states lost $274 million during a 16-day period from February to March 2020.
Total gambling revenues in Pennsylvania fell from $300 million to $153 million from February to March. New Jersey saw a $124 million drop from its figures.
The only bright spot in those losses has been the revenues generated by people playing at home. Delaware reports seeing a 58% increase in activities.
Why Aren’t More Players Going Online?
The issue for the U.S. and its legal online gaming platforms is the structure of the games offered to players.
Most Americans prefer a USA live dealer casino experience when they consider online gambling. That means action at the table games is preferred for the average player.
That data runs counter to what other countries see with their online gaming, where slots are the preferred options. The legal gaming centers expected the global influences to be part of the American experience, so states like Pennsylvania taxed slots at a different rate.
Slots get taxed at 54% and 16% in Pennsylvania, while New Jersey uses a flat 8% rate for its online gaming. That structure saw tax revenues decline by 50% from February to March, going from $124 million to $62 million.
Poker is the biggest game being played in legal American online casinos right now.
How Can Casinos Boost Their Revenues?
Casinos can work to boost their revenues by seeing the traffic patterns of gamers during a month of playing with stay-at-home orders driving their habits. Although wagers are going to be down because of the economic uncertainties that the coronavirus brings, people are still engaged with games that feel like an artificial intelligence system isn’t driving their success or failure.
American gamblers like to have the feeling of being in control of the wager. That’s why sports betting, keno, and table games are appealing from an online perspective. The events don’t provide an atmosphere of being pre-programmed to benefit the house.
As for the states, the issue with their revenues involves how tax structures operate. In-person slots are popular in Pennsylvania, Delaware, and New Jersey, but casinos are discovering that the online version doesn’t have the same appeal. That means legislatures and governors must take a look at structuring the rake differently based on the traffic patterns established between February and March.
If the government shutdowns continue through May and June in the United States, the online games are going to continue growing in popularity. How that impacts revenues for local casinos and state legislatures is largely dependent on their desire to take action now.
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