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Due to unanticipated technical issues but still bullish on prospects
As news came of the advancement of a new bill by the New Jersey State Senate Committee that would allow for interstate online gambling between Nevada, Delaware and New Jersey, Wall Street financial firm Morgan Stanley has lowered its forecast of the U.S. internet gambling market from $5 billion to $3.5 billion by 2017, citing "worse-than-expected technical issues" affecting its projection.
According to Associated Press, the firm also lowered its estimate of New Jersey's inaugural revenue from $541 million to $203 million because of challenges associated with geolocation technology and payment processing options.  Morgan Stanley re-estimated market growth from 20 percent to 10 percent month to month for the remainder of this year.
"While we remain bullish on the online gaming opportunity in the U.S., we are lowering our estimates to better reflect the insights we have gained following the first few months of operations in New Jersey, Nevada and Delaware," a research note said.
Longer term, Morgan Stanley now estimates an $8 billion market by 2020 compared to its initial $9.3 billion estimate.  The company believes the States of California and Illinois may still legalise internet gambling this year, however it does not expect the same from Colorado, Louisiana, Mississippi, Ohio and Massachusetts.
Global rating agency Fitch Ratings maintains its forecast of the New Jersey market at $200 million during the first year, saying: "Fitch believes an interstate online poker agreement signed by Delaware's and Nevada's governors on Feb. 25, 2014 will accelerate state-by-state proliferation of online gaming. Additionally, the momentum for passing an online poker bill in California picked up in 2014. Other large states, such as Pennsylvania, may again consider online gaming as they head into their regular legislative sessions."
The New Jersey bill initially addressed the issue of New Jersey Casino Regulators being able to oversee foreign gambling firms if they moved their operations to Atlantic City but was expanded to include the interstate online gambling compact

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