Nevada’s online sports betting industry predates all others by more than five years, but the Silver State could learn a thing or two about mobile and online betting from the new entrants, particularly New Jersey.
With only a smattering of offerings, New Jersey’s online sportsbooks tallied $12,567,785 in the month of September. Three months in, online sports betting constitutes more than 50 percent of all NJ sports betting revenue.
Nevada doesn’t separate online from land-based revenue, but the breakdown is believed to be nearing 50 percent.
How did NJ sports betting accomplish in three months what Nevada hasn’t been able to do in more than half a decade?
Simply put, New Jersey wasn’t scared.
The cannibalization myth of online gambling
The US land-based casino industry is one of the more cautious industries you’ll come across. Despite mountains of evidence to the contrary, there are pockets of the casino industry that fear online gambling will cannibalize their land-based operations.
The reality is there hasn’t been a more misplaced fear of cannibalization since the headhunters episodes of “Gilligan’s Island.”
That fear caused Nevada to suppress its online sports betting industry by requiring in-person registration for online sports betting accounts.
If you want to open a mobile wagering account with MGM, you’ll need to visit one of their casinos and fill out paperwork. If you want to compare lines from a few different operators, you’ll need to visit those casinos and go through the same process for each account.
That doesn’t make much sense in 2018.
In New Jersey, accounts can be registered remotely, like most things you do online. Imagine if you had to drive an hour and a half to a Netflix kiosk at some mall to open an account. Or find a Citibank in your area if you want to apply for a credit card?
The misguided fear of online gaming products has stunted Nevada’s online sports betting industry.
Bringing the NJ sports betting model to Nevada
The good news is several Nevada casinos are starting to come around. MGM, Wynn, and Caesars will all advocate for remote registration at an upcoming Nevada Gaming Control Board hearing.
Even in a mature market like Nevada, remote registration would have numerous benefits, including:
- Allowing licensed sportsbooks to convert more black market players to the legal market.
- Giving sportsbooks deeper penetration into the more remote areas of the state.
- Attracting customers from neighboring states who live near the Nevada border, but not near Las Vegas.
A lesson for other states
In new markets, it would have an even larger effect.
Land-based sportsbooks can replace the neighborhood bookie, but many people currently place their sports bets with an offshore, online site. The only way to capture that market as quickly and as completely as possible is by offering a similar experience, and asking someone to register an account in person at a casino is not a similar experience.
Bottom line: Allowing remote registration is a lesson other states considering online sports betting would be wise to learn.