Two Steps Forward; One Step Back
Two Steps Forward; One Step Back
Responsible gambling funding is up, but has anything changed? Delays in New York casino licenses could sink iGaming efforts.
The Bulletin Board
NEWS: There have been significant increases in responsible gaming funding, but is it producing the desired results?
LOOSE ENDS: Lotto.com comes to MA; Caesars launches new iCasino in MI; Aeropay and Worldpay partnership.
NEWS: The battle over downstate New York casino licenses is heating up.
VIEWS: One expansion at a time: Online gambling will face an uphill battle until NY casinos open for business.
AROUND the WATERCOOLER: News and views from G2E Day 3.
STRAY THOUGHTS: Ask why, and you’ll get your answer.
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RG Funding on the Rise, So Are PG Concerns
According to new research from the American Gaming Association, the gambling industry has increased its total spending on responsible gambling to $471.8 million annually—up from approximately $275 million (+72%) in 2017.
The commitment is noble, but there are some questions about the efficacy of that spending, as the news sits in stark contrast to mainstream media reports that indicate problem gambling is on the rise since the real of PASPA (just in the last few weeks):
“Since 2018… the Council on Compulsive Gambling of New Jersey has seen a 277% increase in calls to its 800-GAMBLER helpline, with a shift to many more calls from young adults.” — NJ Spotlight News
“From January through June alone, the helpline had 967 intakes, far surpassing last year’s 898 total intakes.” — Dr. Carolyn Hawley, the president of the Virginia Problem Gambling Council and an associate professor in mental health counseling at Virginia Commonwealth University’s School of Allied Health Professions
“Overall call volume went up 79%. Specifically, clinical calls, which are calls somebody makes when seeking treatment or help, went up 34%,” said Amanda Winters, Problem Gambling Administrator for the North Carolina Department of Health and Human Services (NCDHHS). “Other statistics include people attending treatment for gambling issues, up 28%. Also, people who want to block gambling apps on their phones or devices shot up 82%, chats to the helpline were up 104%, and engagement with the NCDHHS Call to Change program, a remote program that helps people move through the stages of change, spiked 20%.”
The industry needs to avoid telling two different stories and engaging in behavior that leads to Pyrrhic victories. That’s a drum I’ve been banging for a while on all manner of topics:
“You can’t tout your rosy outlook and how much market share and revenue you’re generating in earnings calls and then cry poor in front of lawmakers.” ~ on the Illinois tax increase.
“Essentially, this may not be a road sweepstakes naysayers want to travel. Either the technology works, and sweepstakes sites are using it, or it doesn’t, which opens the proverbial Pandora’s Box. And you better have your own house in order if you’re going to complain about AML deficiencies.” ~ on the industry’s criticisms of sweepstakes operators.
“When you get more funding, you better produce better results.” ~ on increased RG funding.
Yes, funding is on the rise, and that’s terrific, but it won’t appease your critics. Only results will do that.
Loose Ends: Lotto.com Comes to MA; Caesars Launches New iCasino in MI; Aeropay and Worldpay Partnership
Lotto.com approved for launch in Massachusetts: Jackpocket is the best-known brand, but it’s not the only company in the lottery courier space. Following its Massachusetts launch, Lotto.com is now up and running in its eleventh state and seventh with scratch-off sales—by comparison, Jackpocket is available in 19 states, but scratch-off sales are only on offer in three. The Massachusetts launch is intriguing, as the state recently legalized online lottery sales, including instant win games.
Caesars unveils Horseshoe Online Casino in Michigan: Following the launch of Horseshoe Online Casino, Caesars joins DraftKings as the only online gambling operator with two online casino brands in the Michigan market. The launch was a result of Caesars purchasing Wynn’s Michigan online casino assets in February. As Chris Grove said on X at the time: “Multi-brand matters a lot for online casino. It will matter for online sports betting as well, but it matters more for online casino.”
Aeropay and Worldpay announce strategic partnership: Aeropay (a newsletter sponsor) and Worldpay announced that they’ve entered into a strategic partnership “to enhance gaming payments for players and operators.” Per the press release, “Aeropay's proprietary account-to-account platform can now be integrated with Worldpay’s extensive merchant network — offering advanced A2A payments and payouts to U.S. gaming operators.” On LinkedIn, Aeropay summarized the partnership's benefits: Instant payouts, reduced processing costs, stable bank connections, and guaranteed payment services.
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New York Casino Update
The New York Post is tracking the ten downstate casino projects vying for three coveted licenses. The industry expects the two existing racinos to claim licenses #1 and #2, leaving just a single license (and eight bidders) up for grabs.
According to The Post, Las Vegas Sands is the frontrunner, as the Downtown Manhattan projects face stiffer political resistance.
“Given hostility to a new casino in Manhattan, both gaming experts rated Las Vegas Sands’ bid a serious contender for the third license up for grabs,” The Post reports.
However, some are making a case for a Manhattan casino, arguing, “The criteria for a winning bid should boil down to three key questions — who can deliver the most tax revenue, the most jobs, and the most benefits with the least disruption to their communities?”
Those are the words of former New Orleans Mayor Mark Morial, who can boast of bringing the first casino to Louisiana.
“It’s likely two of the licenses will go to operators in Queens and Yonkers, where dealer-less “racinos” can easily be built out,” Morial wrote in a recent op-ed.
“That leaves one additional license, and I’m a strong supporter of bringing it to Manhattan.
“The borough is an enormous draw for tourists, is easily accessible for workers, and will provide the largest economic return.
“This was one of the main arguments for bringing a casino to my city of New Orleans. Today, that casino contributes $260 million a year to the state’s coffers and supports nearly 2,000 jobs.”
John Sabini, former chairman of the state racing and wagering board, told the Post, “The Sands proposal is probably the strongest proposal right now. Long Island/Nassau-Suffolk is a pretty good market.”
The other proposal highlighted in the Post article is from Mets’ owner Steve Cohen, who is teaming up with Hard Rock Entertainment to pitch an $8 billion project to “ardHardtransform the Willets Point area west of Citi Field into a major entertainment destination,” with a Hard Rock Casino as the center point, per AMNY.com.
“The proposal includes 20 acres of new public parks, five acres of new community athletic fields, accessibility upgrades at the Mets-Willets Point 7 train stop, improved roadways and cycling paths, and a $163 million “community impact fund” that would provide grants to local Queens nonprofits.”
The Cohen proposal is also getting some help from Gov. Kathy Hochul, who, as the Post put it, is “going to bat” for one of her biggest political donors.
The state may also not have to choose between Manhattan and elsewhere. The existing racinos’ proposals are not automatic. They will have to submit competitive bids, as some of the proposals are, as industry experts told The Post, “dazzling.”
Beyond the Headline: Online Gambling Unlikely Until Casinos Open
New York is one of the crown jewels for online casino advocates, and with licenses likely tied to land-based casinos, it is quite important who is awarded the downstate casino licenses.
The land-based industry is a mix of pro and anti-online gambling companies, and even within the pro crowd, there is a lot of disagreement over the licensing structure (tethered, untethered, or a mix of both).
The winning bids are not expected to be announced until the end of 2025, so the likelihood of the New York legislature tackling online casinos before then is slim to none.
The only hope is a budget deficit that forces the state to scramble for a new revenue stream. Still, in that case, the industry may not like the proposal put forward by a legislative body that taxed sports betting at 51% when it wasn’t desperate for cash.
Also floating around the ether is the unfolding scandal surrounding Mayor Eric Adams and multiple people in his administration. Even though it’s disconnected from gambling, lawmakers tend to get cold feet when other elected officials are being investigated and indicted.
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Around the Watercooler
Social media conversations, rumors, and gossip.
Two (largely milquetoast) takes on California, Texas, and Florida from DraftKings CEO Jason Robins and Circa CEO Derek Stevens from a larger X thread on their keynote addresses:
Robins also took a swing at predicting what sports betting might look like in 30 years (reporting by Geoff Zochodne):
“I think that a lot of it is going to be based on where technology ultimately evolves. Obviously, AI is a big thing. I wouldn’t be surprised if sports get created with cyber-athletes, and there’s betting and gaming on that.” [Is it just me, or does this sound an awful lot like virtual sports?]
“Robins added later, presumably joking, that people may someday be betting on events on another planet.”
Jamie Salsburg asked ChatGPT to write a fictional story on the latter, and it didn’t disappoint: You can read it here.
One more note from G2E, this time from Legal Sports Report’s Sam McQuillan: “Live betting accounts for 40% of betting volume in the US, Simplebet's head of analytics, Andrew Pupolo, said today during a panel at G2E in Las Vegas. Simplebet was recently acquired by DraftKings.”
Stray Thoughts
In last week’s feature column, I wrote that results matter.
Throwing money at a problem is fine and can work, but if your basement floods every time it rains, you might want to figure out how the water is getting in rather than renting a storage unit because you can’t keep things in your basement, investing in pumps that handle the water from most, but not all, storms, and adding the cost of a cleanup service to your monthly budget.