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New Jersey Online Casino tax revenues dissapointing
Sunday November 22,2014 : NEW JERSEY ONLINE GAMBLING DISAPPOINTS
New channel for gambling helps land casinos, but falls far short of estimates.
Taking a retrospective look over the past year, when online gambling has been legal in the state of New Jersey, the Associated Press news agency noted over the weekend that whilst internet gambling revenues had helped some land casinos, the tax revenues anticipated by the state government have fallen well short of estimates.
Governor Chris Christie had hoped to see revenues in excess of a billion dollars generated in the first year of legalisation, but the reality is that only a tenth of that - $111 million - was achieved, and one operation, Ultimate Gaming, has folded and pulled out of the market.
On the positive side, the revenues did help the struggling Atlantic City land casinos that entered the online market, making the difference between declining and increased year-on-year revenues, however small.
And David Rebuck, the director of the New Jersey Division for Gaming Enforcement told AP that the regulatory system was working "...really well, without any catastrophes, meltdowns or scandals."
Teething problems in the technologically complex system included geo-location performance in the early days and a reluctance to accept online gambling transactions by credit and debit card companies.
Whilst the geo-location technology has been fine-tuned and now rejects a mere 5 percent of visits from punters within state boundaries, the credit card hassles have proved more persistent and difficult to totally overcome, and state officials continue to argue the issue with banks and card companies.
The well-funded anti-online gambling jihad waged by land casino mogul Sheldon Adelson has hardly helped, prompting his fellow operators in the Casino Association of New Jersey to urge the state’s congressional delegation to resist any attempt to pass his proposed Restoration of the American Wire Act banning proposal.
To survive and prosper the industry needs to expand and embrace a bigger player pool through awareness campaigns and player-sharing deals with other states that have legalised, and talks continue on this possibility, Rebuck disclosed, revealing that he has been in discussions with authorities in Nevada and the United Kingdom about reciprocal agreements, although no deal is imminent.
The review of Pokerstars' suitability for licensing now that it has a new owner is still ongoing as the year draws to a close, with Pala Interactive about to launch an operation and another company reportedly in the wings, according to Rebuck.
But there can be no denying that Internet gambling revenue has been slowly declining in New Jersey in recent months, leading Deutsche Bank analysts to reduce revenue estimates for 2015 from $250 million to $150 million.
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