The Impact of Online Gambling on Land-Based Casinos Hello and welcome to another part of our blog series on the topic of online gambling. Last time, we discussed the pros and cons of online gambling. Today, we’re going to be talking about how online gambling impacts land-based casinos.
Now, we already discussed this aspect of online gambling in our “Debunking Anti-Online Gambling Arguments” series. However, we didn’t really explore the topic in a detailed manner, which is exactly what we’ll be doing now.
So, does online gambling pose a threat to land-based operations?
Not too long ago, before Pennsylvania said yes to regulated online gambling, Tim Shea, the President of the Pennsylvania Horsemen’s Benevolent and Protective Association Inc., argued that regulated online gambling would have an extremely negative impact on the commercial casinos business.
Shea is believed to have come to that conclusion based on a study published in 2011 by the UNLV Gaming Research and Review Journal. The study was titled “The Effect of Online Gaming on Commercial Casino Revenue”.
But, here’s the thing – Shea got it all wrong. No, that’s not just an opinion. It’s a fact stated by none other than Kahlil Philander, the man who penned the study. In a tweet that followed Shea’s statement, Philander made it clear that the man’s interpretation was completely off the path. He even called Shea’s statements “misleading”.
The truth is quite different from what Mr. Shea’s believes it to be and it pretty much echoes what we discussed in our “Debunking Anti-Online Gambling Arguments” blog – online gambling is benefiting land-based casinos.
Before Pennsylvania recently legalized online gambling, Nevada and New Jersey were already on the bandwagon. The two states legalized online gambling in 2013 and 2011, respectively. Needless to say, this has provided us with enough evidence to refute the whole “online gambling hurts land-based casinos” rhetoric.
For instance, Nevada’s World Series Poker (operated by Caesars) offers regulated online poker, which has managed to engage the company’s existing customers. This has been successfully executed through innovative ideas such as the first online WSOP bracelet event. The event allowed live poker players to also play the game online at the same time.
As for New Jersey’s casinos, it has been reported that most of the customers who opt for online gambling happen to be fresh faces. In other words, the existing customers still prefer land-based options.
Caesars stated that around 90% of the online registrations are customers who weren’t part of the Total Rewards Database. What turned out to be even more interesting was the fact that a significant percentage of those online customers ended up patronizing the land-based property as well.
So, as you can see, online gambling has only benefited land-based venues. However, it’s a conversation that still needs to continue if nationwide legalization has to be achieved.