[toc]2016 is coming to a close, and it’s been quite the year for the New Jersey gaming industry.
The North Jersey casino referendum went down in flames.
After a two-and-a-half-year wait, PokerStars launched its New Jersey online poker site. The state’s sports betting saga keeps chugging along. Trump Taj Mahal closed its doors.
But in this column I’m going to put 2016 in the rearview mirror and look ahead to 2017. Here are 10 bold (some more than others) predictions for New Jersey gaming in the upcoming year.
10. Resorts will be the monthly revenue leader in NJ
Resorts‘ online casino and poker room ascended to the top of the New Jersey online gambling pack, and it looked like a foregone conclusion following record-setting (for Resorts) April, posting more than $3.4 million in total online gaming revenue.
But Resorts’ meteoric rise came to an abrupt stop. Since hitting its high water mark in April, it has struggled to stay above the $3 million mark.
Here’s the breakdown:
- January 2016: $1,434,295
- February 2016: $1,318,338
- March 2016: $1,878,097
- April 2016: $3,478,108
- May 2016: $2,995,558
- June 2016: $2,703,042
- July 2016: $3,052,298
- August 2016: $2,896,284
- September 2016: $2,911,044
- October 2016: $2,741,142
- November 2016: $3,212,082
That said, Resorts is one of the most aggressive players in the New Jersey online casino market.
9. Taj Mahal will reopen and launch an online casino
Before the landmark casino was closed following a prolonged labor strike, I had it on good authority that Taj Mahal was preparing to launch an online gaming site.
The Taj remains closed, but rumors of the property reopening in early 2017 were already swirling before the doors were officially locked.
Tropicana owner Carl Icahn has a substantial amount of capital invested in a shuttered casino, and it seems unlikely he’ll just wash his hands of it, although he could be in for a bitter fight with pro-union lawmakers who are trying to prevent the billionaire from reopening the property with a non-union labor force.
8. Casinos will begin to work together on online projects
New Jersey’s online gaming industry has been growing by leaps and bounds, and every operator has a solid market share in a very competitive market.
But as the market hurtles toward maturity (more on this in a moment), the current operators are going to start exploring new products (live dealer games and virtual sports are two examples). When they do, they may find themselves partnering with one another to keep overhead and other costs down.
Golden Nugget Vice President of Online Gaming Thomas Winter confirmed that these types of discussions are already taking place.
“We are in discussions with a few potential partners who understand the benefits of offering a differentiating product, but [who] also recognize that the New Jersey market alone is probably not big enough to justify the overheads of two studios,” said Winter, regarding the possibility of other online operators partnering with Golden Nugget to utilize GN’s live dealer studio.
7. PokerStars’ next tournament series will have strong attendance numbers
PokerStars Festival New Jersey pulled out all the stops, but there was just one little problem … the people didn’t show up.
A second Festival is already being planned for the spring. I expect PokerStars has already conducted a comprehensive autopsy on the inaugural Festival and is in the process of coming up with solutions to whatever issues it uncovered.
The Festival in the spring is going to be big, and I expect it to prove that the Atlantic City poker market is alive and well, and exists beyond the confines of the Borgata.
6. NJ Online casino revenue will settle
OK, so not all of my predictions can be bright and cheery, and even though the current trajectory of the New Jersey online casino market is up, I don’t expect this to be the case throughout 2017.
Online casino revenue in New Jersey has grown by 30 percent or more in each of the last eight months, and the year-over-year numbers show an industry that has posted gains each and every month.
But at some point the industry will hit critical mass, and the YoY growth streak will come to an end. My guess is this will happen sometime in 2017.
5. No sports bet will be placed at a New Jersey casino or racetrack
Despite what some key figures in the state are declaring, sports betting is not going to become a reality in New Jersey in 2017. This is wishful thinking and has no grounding in reality.
4. VGTs will not be approved by the legislature
Along the same lines, don’t expect the New Jersey Legislature to pass a bill that would allow the state’s horse racing tracks to put “slot machines” on premises via some backdoor language.
A bill seeking to do just that, under the guise of being an online gambling bill, is being kicked around the legislature, but its true purposes have already been revealed.
As Assemblyman Vincent Mazzeo told Politico:
“This intent was not what we thought when we came here. And now that you read into the bill and heard the testimony, there’s something up here. Something doesn’t smell right.”
Furthermore, it’s a pretty big ask to get elected lawmakers to go against the wishes of the voters, especially when the voters opposed the expansion of casino gambling outside of Atlantic City by a 77/23 margin.
3. A new online poker room will launch in New Jersey
The market isn’t anywhere near large enough to warrant another online poker site, but the New Jersey online poker market isn’t even really large enough for a single online poker site.
There are currently five of them, and I’d be surprised if any of them are making a dime:
Whoever launches going forward (Pala is the most likely company) will likely do so with an eye toward the future. They’ll be using New Jersey as field test — a very expensive field test.
2. Another PA casino will launch a NJ online gambling site
I expect this to happen for two reasons:
- Pennsylvania is close to passing an online gambling bill, and New Jersey would allow potential stakeholders to trial their software and create relationships with New Jersey operators in the event the two states partner and enter into an interstate agreement.
- PlaySugarHouse.com has provided a boost to Golden Nugget’s revenue numbers, and other Pennsylvania casinos close to the border might see the New Jersey online gaming market as a good business opportunity.
1. Something altogether unexpected will happen
In my seven years of covering this industry, I’ve come to realize there is really only one hard and fast rule: Something will happen that nobody saw coming.
UIGEA in 2006. Black Friday in 2011. OLC opinions green-lighting intrastate online gambling. PokerStars being sold to Amaya.
So, as 2017 rolls along, be prepared for the unexpected.