New Jersey, the most-populous state to legalize online gambling, said casinos took in $8.37 million in the first six weeks of play in a debut marked by technical glitches and payment problems.
Borgata Hotel Casino & Spa, owned by Boyd Gaming Corp. (BYD) and MGM Resorts International (MGM), and Caesars Entertainment Corp. (CZR) led with $3.75 million and $2.38 million respectively, the Division of Gaming Enforcement said today on its website.
Casino operators haven’t fully rolled out their marketing efforts or mobile services, according to Robert Shore, an analyst with Union Gaming Group in Las Vegas. Would-be gamblers faced challenges signing up because of software problems, and some banks refused to allow credit cards for online play.
“I wouldn’t extrapolate too much from these numbers,” Shore said in an interview.
New Jersey became the third state to allow gambling online when betting started Nov. 21. To help existing casinos, where revenue has fallen for seven years, the state required online operators to locate their computer hardware in an Atlantic City property. The research firm H2 Gambling Capital predicts U.S. Internet betting could become a $7.4 billion business by 2017.
The New Jersey betting total reflects results through year-end. About 126,000 accounts were opened through Dec. 31, with the number now at about 150,000, officials said. Play is limited to people over 21 who are in the state.
“Online and land-based poker revenue at Borgata was up more than 40 percent from our land-based play in December 2012,” Keith Smith, Boyd’s president and chief executive officer, said in a statement. “Clearly, online gaming is complementary to our land-based business, not competitive.”
In March, Governor Chris Christie forecast $1.2 billion in online revenue for the operators this fiscal year and $180 million in tax collections. That compares with a Bloomberg Industries estimate of $425 million in revenue for New Jersey in calendar 2014, or 83 percent of the U.S. total.
Nevada, which limited its online betting to poker, will begin breaking out results once there are three operators, according to Michael Lawton, senior research analyst for the Nevada Gaming Control Board. Presently Station Casinos Inc.’s Ultimate Poker and Caesars operate in the state.
Delaware will release online gambling statistics in a few days, according to Vernon Kirk, director of the state lottery, which supervises the betting. The state has about 4,300 registered accounts that have generated $10.3 million in total wagers, not revenue, he said. Delaware began accepting online bets Oct. 31.
Eight New Jersey casinos are licensed to offer online betting, according to the state. Casinos have partnered with online gambling providers. Borgata operates in a joint venture with Gibraltar-based Bwin.Party Digital Entertainment Plc (BPTY), while Caesars has partnered with 888 Holdings Plc (888), also based in Gibraltar.
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