In the thriving heart of New Jersey, a quiet revolution is underway, one that promises to redefine the landscape of gaming prosperity. For decades, the illustrious skyline of Atlantic City has been synonymous with the clinking of slot machines and the rustling of playing cards, its nine casino hotels standing as monoliths to chance and entertainment. Yet, beneath the neon glow of the Boardwalk, a new contender has emerged – the intangible yet increasingly potent force of iGaming.
Carlo Santarelli, a Deutsche Bank analyst with a keen eye on market currents, has unveiled a riveting forecast that beckons to a future where the virtual realm triumphs. According to his penetrating insights, iGaming gross gaming revenue (GGR) could burgeon to a staggering $2 billion in the current year. This projection doesn’t just flirt with prediction; it solidifies the sentiment that iGaming is on a meteoric rise, poised to eclipse the physical world of casinos. Indeed, back in 2019, online casinos in the Garden State pocketed a mere $483 million in GGR – a figure now dwarfed by present triumphs.
Last year bore witness to this silent battle of titans, as brick-and-mortar casinos in Atlantic City amassed $2.85 billion in GGR, closely tailed by their digital counterparts at $1.9 billion. Santarelli observed a closing gap that once yawned at $2.2 billion between land-based and digital casino revenues in 2019. The implications of this tightening rift are profound.
The debate rages on whether iGaming is a bane or boon to traditional casinos. Some experts argue it’s a complementary wing, especially for juggernauts that can deftly intertwine loyalty programs, enticing gamers to grace their physical establishments in pursuit of rewards reaped in the digital sphere. Yet, whispers of vulnerability shroud Atlantic City, the once-unquestioned kingdom of gambling now facing the prospect of over-saturation. Nine gaming behemoths cast long shadows over each other, battling for patrons who are increasingly reluctant to venture to Atlantic City’s Boardwalk – a testament, perhaps, to insufficient investments in these casino hotels, leaving them a shadow of their former glory.
Amplifying Atlantic City’s woes is a year of contracted profits for the nine casino leaders, with a mere trio — MGM Resorts’ Borgata, Ocean Casino Resort, and Bally’s — escaping the downturn. Adding to this conundrum is the ominous presence of New York City, tiptoeing into the scene with the prospect of three new casino hotels, and murmurs of Meadowlands rising as a new champion, which could spell further strife for Atlantic City.
Yet hope and innovation are alive and well within New Jersey’s digital frontier — an arena bristling with options where consumers assert their choices. Yet, it’s the familiar names that seize dominion in this brave new world of iGaming. Golden Nugget Online Gaming (GNOG), now under DraftKings’ expansive umbrella, strides alongside Resorts Casino and Caesars Digital, leveraging esteemed brands such as Harrah’s and Tropicana to command the cyberspace of New Jersey.
In this unfolding narrative, Santarelli earmarks a potential game-changer: the proposal to escalate taxes on iGaming activities to 30% from the existing 15%. Despite the unknowns shrouding promotional tactics, he emphasizes net revenue’s resilient ascent amidst increasing promotions, bolstered by a 15% tax rate that seems ever more vital in nurturing this growth.
The digital tide is swelling, and Atlantic City must navigate these choppy waters with care, lest it becomes a memorial of gaming’s former glory in the wake of iGaming’s relentless surge. Where chips once clattered against game tables, now silent clicks herald a new era of enterprise – less about the physical cards dealt than the virtual hands played. The evolution is underway, the future unfurling in bits and bytes, and in New Jersey, it is a matter of when, not if, iGaming redefines the zenith of gaming revenue.
