A Walking Contradiction
Cordish Companies vehemently opposes online gambling, so why does it offer it where available? The answer is actually quite simple.
The Bulletin Board
THE LEDE: Is Cordish’s online gambling stance really a contradiction?
ICYMI: Latin America opportunities; MA tribal casino update
NEWS: Mississippi mobile betting efforts are back on the table in 2025.
VIEWS: Land-based casino revenue isn’t holding steady.
AROUND the WATERCOOLER:
STRAY THOUGHTS: Holiday Schedule and recent columns.
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The Lede: Cordish Companies’ Nuanced iCasino Position
Before the NCLGS Winter Metting kicked off in New Orleans, the Louisiana Senate Judiciary Revenue and Fiscal Committee held a hearing on legalizing online casino gambling.
The hearing clearly showed who supports and opposes online casino legalization in Louisiana. Cordish Companies and the entrenched VGT industry were firmly opposed, to no one's surprise.
In a slightly contentious exchange, John Pappas, representing iDEA Growth, fired back by saying, “I thought that the Cordish point of view was interesting… when you recognize that they are an online casino operator in other states.”
Pappas called it “A very interesting principal position.”
However, Louisiana Sen. Mike Reese quickly jumped in, saying that he has spoken with Cordish representatives, who have indicated that if it is legalized, Cordish will participate in the market.
That shouldn’t be a surprise, nor is it a contradiction.
Unlike Sheldon Adelson’s moral opposition to online gambling, Cordish believes online casinos shift consumer spending away from land-based properties. However, the company has been very upfront about its stance — It’s opposed to it, but if it’s legal, it will be involved — Parx Casino took a similar stance when Pennsylvania considered online gambling legalization in 2016.
Cordish believes online revenue eats into land-based revenue and doesn’t think that that phenomenon is confined to each operator. Simply put, if an online operator is going to steal some of Cordish’s land-based properties’ revenue (its belief, not mine), it may as well be Cordish.
ICYMI: Latin America Opportunities; MA Tribal Casino Update
Latin American online gambling market set to grow five-fold by 2028: According to new research from Vixio (a newsletter sponsor), “Latin America's regulated online gambling market is set to grow more than five-fold over the next few years to reach $12.3 billion in 2028.” The biggest driver of the region’s growth will be Brazil, scheduled to launch in January 2025. According to Vixio, Brazil will account for half of the Latin American online gambling market.
Mashpee Wampanoag takes another step toward opening First Light Casino: The Mashpee Wampanoag tribe’s quest to open a tribal casino in Massachusetts has been a bumpy ride, but the end could be in sight. The tribe has begun construction on a new welcome center at the proposed site of the First Light Casino in Taunton, MA."At this center, all are welcome to preview the benefits of Project First Light and see what tribal stewardship of our land looks like,” spokesperson Steven Peters told the Taunton Gazette. Whether the project is an end in and of itself or a first step to the long-awaited casino is still unclear.
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News: Mississippi Will Take Another Bite at the Mobile Sports Betting Apple in 2025
Online sports betting will be in play in Mississippi in 2025, and supporters can now point to declining revenue and a very sticky, unregulated industry as reasons to expand gambling in the state.
“Mississippi sports betting handle is on pace to be down 5% from last year, with revenue down 15%, per MS Gaming Commission Director Jay McDaniel; he said the state's revenues have decreased with online legalization in Louisiana and Arkansas; MS doesn't permit statewide mobile.”
“Online sports betting legalization will likely be discussed again in 2025 in the Mississippi legislature, per McDaniel; a bill failed in 2024.”
McDaniel also said Bovada and other offshore operators have ignored the MGC’s cease-and-desist letters. As I reported on Tuesday:
“Mississippi Gaming Commission (MGC) Executive Director Jay McDaniel said that offshore sites, Bovada, MyBookie, BetUs, BetWhale, and BetOnline, have ignored its C&D letters. The likely reason? The offshore do a lot of business in Mississippi since the state doesn’t have licensed online alternatives. Basically, if they are doing a lot of business in your state, they aren’t leaving.”
Of course, a hearing earlier this year devolved into a debate over online casinos, as some Mississippi operators feel online sports betting is a stepping stone to online casinos.
Views: Demand Shift Can’t Be Held at Bay ,and it Isn’t Reversible
Land-based casino revenue is flat. It’s not declining,; it’srelatively flat. That’s what online gambling advocates say whenever they are pushing back against claims that consumer spending is shifting from land-based to online gambling.
New Jersey’s recent November numbers are a good example. On the surface, the numbers look ok, with online revenue reaching a new high and land-based revenue flat, compared to 2019.
Here’s what those “flat” numbers look like if we use the Bureau of Labor Statistics inflation calculator:
Suddenly ,there is an 18.5% drop in retail gambling revenue.
I’ve made this point before: Historical numbers cannot be compared without adding context. Inflation is a big part of that context, particularly in recent years
Let me be clear: That doesn’t mean legalizing online gambling results in a downward trend in land-based casino revenue. The reason is that whether it’s legal or not, loads of people are betting money online, and they’re not going to stop based on legality.
As I’ve said for years (perhaps a decade now?), you can’t stop people from gambling online. The idea that you can bury your head in the sand and pretend you are helping your brick-and-mortar business by resisting legalization is folly.
All you are doing is ensuring that the current regulated industry loses all the existing online revenue to gray and black market operators, and that your company will not be a significant player when it is inevitably legalized and regulated.
The best option for any land-based casino operator (the only good option, actually) is to advocate for policies that allow online gambling to interact positively with existing gambling.
A world exists where land-based casinos are perfectly happy with more money being gambled online than on their casino floors and where they continue to invest in their land-based properties.
That is not the world we live in.
Right now, land-based and online gambling (even when offered by the same company) are engaged in a zero-sum game for the customer’s wallet, and it isn’t healthy for anyone.
All we have to show for it is:
Stalled efforts to legalize and regulate online casinos and poker.
A land-based casino industry falling further and further behind its online-first competitors in terms of tech and online offerings.
A more, more, more marketing model as land-based and online operators compete for a bigger slice of the consumer’s wallet.
Someone needs to find the synergies between the two and not look at retail and online games as competing products.
Why hire Steve Ruddock? Over the years, Steve has advised startups, national gambling companies, government agencies, and investment banks on a wide variety of topics.
Whether you’re looking for market research, want to raise your brand awareness, or are trying to develop responsible gaming strategies, Steve can help with honest, balanced, no-nonsense analysis of the situation.
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Around the Watercooler
Social media conversations, rumors, and gossip.
Jamie Salsburg has been posting some very interesting thoughts on the current responsible/problem gambling landscape.
Here is an excerpt from one, but all three tweets (here, here, and here) are worth a read:
Stray Thoughts
Reminder: STTP will be on vacation next week. There will be a feature column tomorrow, and newsletters will resume on Monday, December 30.