Take A Number Please: New Operators Are Lining Up To Enter The NJ Online Casino Market

Operators line up for NJ online casino license
The NJ online casino industry is in the midst of an extended boom.

Every month since April 2016, the industry has experienced no less than 30 percent annual growth. And whereas $10 million in monthly NJ online casino revenue was the norm in 2015, it likely won’t be long before $20 million becomes the new gold standard.

So naturally, online gambling candidates have been lining up to capture a small piece of the burgeoning market. In fact, we project that no less three new operators will enter the mix before mid-2018, compared to just two new entrants in both 2015 and 2016.

At present, the industry certainly seems like a hospitable environment for newcomers. Play SugarHouse, which found success despite launching nearly three years after the industry went live, is living proof of that.

But that’s not to say the latest batch of candidates will be able to just coast along and watch the dollars flow.

Here’s a look at those hopefuls, and what each brings to the table.

playMGM

PlayMGM is the only candidate that we know for sure will launch in New Jersey, with a projected go-live timeframe of third quarter 2017. It’s also the one that we deem stands the greatest chance of upfront success.

Pros

  • Brand notoriety: Although playMGM will not be affiliated with an Atlantic City casino brand, it’s the next best thing. The world renowned casino operator is the owner of the Borgata, and owns multiple casino venues on the east coast.
  • M life integration: Like Caesars before it, playMGM will be integrate its live and online rewards program. This should prove effective at driving land-based players to the site, and vice versa.
  • Game library: Supposedly, playMGM will launch with over 300 games. That’s significantly more than the Borgata offers, and above average for the industry.
  • Spending power: It’s presumed that the launch of playMGM will be coupled with a marketing blitz. Part of that may include a lucrative sign-up and first deposit bonus, which should especially appeal to players who have exhausted their welcome packages on other sites.

Also worth noting, and this applies to all newcomers to the industry, there have been significant strides in the areas of payment processing, mobile technology, and game variety since the first NJ online casinos opened their doors to the masses.

PlayMGM and other new sites will be able to capitalize on these advantages during the critical launch phase, when acquisition rates stand to be at their highest.

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Cons

  • Platform: This is more a “neutral” than a con. The playMGM platform will be provided by GVC, which also powers Borgata Casino. The software, which is available on browsers, mobile, and as a downloadable client, isn’t the industry’s best.
  • Same old, same old: By extension, playMGM may just come off as another skin on the Borgata network — which in reality, it is. It won’t dazzle players like SugarHouse’s proprietary platform did when it launched last September.
  • Poker: MGM is also launching an online poker skin. Quite frankly, the industry doesn’t need another site, especially on the network with the industry’s lowest traffic and market share. Marketing dollars can be better spent elsewhere.

A universal factor working against all newcomers is that they’re entering the market some four years after it launched. As noted, there still does appear to be room for them, but there’s no guarantee that the explosive growth of the industry won’t peter off.

If that happens, the new casinos will be more reliant on cannibalization than attracting unique players.

TEN online casino

A TEN online casino has a lot of potential. But it’s just that.

Pros

  • Known Atlantic City brand (sort of): TEN online casino will be branded after an Atlantic City venue. That’s good news, as Atlantic City branded sites tend to get off to much stronger starts than outside entities. However, TEN lacks the name recognition of the boardwalk’s old standbys. Reason being, the land-based property hasn’t actually opened yet. (In a former life, TEN was known as the Revel).
  • Preparation: TEN recently launched a social casino. Not only does the social casino draw attention to the nascent brand, but it also enables TEN to trial the digital waters before diving in. The social casino is powered by GAN, which is the software provider behind one of NJ’s most successful online casinos: Betfair Casino.

Cons

  • Licensing: Put simply, an entity can’t apply for an online gambling license unless they first possess a license to operate a land-based venue in Atlantic City. TEN doesn’t have one, and owner Glenn Straub doesn’t believe he should have to apply for one, with the justification being that “he’s leasing the casino to a third party.”
  • Negative connotations: The former Revel is a physical monument of Atlantic City’s dark period. If that weren’t bad enough, TEN has become something of a running joke in the media, losing more credibility with each missed launch date. Will players take to an online casino tied to a brand with such a negative rep?
  • Divided efforts: How much attention can TEN really devote to online when ownership will be working primarily on bolstering the land-based casino? Other Atlantic City brands were well established before venturing to online.

Hard Rock online casino

At this juncture, the launch of a Hard Rock branded online casino in New Jersey is pure speculation. However, we see no reason why the property — which recently acquired the shuttered Trump Taj Mahal for pennies on the dollar — wouldn’t go online.

Pros

  • Familiarity: The Hard Rock Cafe has been a staple of the Atlantic City boardwalk for years, and there are Hard Rock casinos throughout the world. The brand is not as instantly recognizable to gamblers as MGM, but the divide isn’t too wide either.
  • Branding: Furthermore, the online property would likely be branded as Hard Rock Casino, or a close equivalent.
  • Commitment: Hard Rock has exhibited a firm commitment to the NJ market, evidenced by its intention to spend $400 million on renovating and updating the gaudy and dilapidated property. It’s likely to extend that commitment online, where aggressive marketing spend is critical to long term success.

Cons

There aren’t really too many cons associated with a Hard Rock branded online casino, but there is one big question mark.

  • The unknown state of the market: Hard Rock Casino isn’t projected to open until summer 2018. By then, there’s a fair, even good, chance the NJ online casinos market will reach full maturity. Once that happens it’ll become increasingly difficult for a new property to gain significant market share. Hard Rock online may gain the crux of its traffic via cannibalization.

More on Hard Rock’s prospective online casino here.

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Robert DellaFave

About

Robert is a game designer and avid poker player. He is a contributor to numerous online publications focused on legal online gambling sites in New Jersey. He also writes about the legal US online poker market.