Casino Companies Scramble for Share in New Jersey Online Gaming Market
Right now, the worth of New Jersey’s fledgling Internet gaming industry cannot be estimated. But state lawmakers, regulators, Wall Street analysts, and industry experts have estimated that online gambling has the potential of generating around $1.2 billion in revenues during its very first year, which is around 40 percent of which the 12 land casinos in Atlantic City generated in 2012.
New Jersey has already readied a draft regulatory framework, and regulators want the first gambling sites to go live by Thanksgiving. Casino companies based in Atlantic City have been given a deadline of June 30 before which they have to finalize their partnerships with gambling software providers. Applications should be submitted to the New Jersey Division of Gaming Enforcement (NJDGE) by July 29.
Only two companies have declared partnership deals so far. Caesars Entertainment Corporation, which has four casinos in Atlantic city, wants to launch an online casino product in New Jersey in partnership with 888 Holdings, a company based in Gibraltar. Boyd Gaming Corporation, the owner and operator of Borgata, is on the verge of finalizing a partnership deal with Bwin.party, the world’s largest online gambling company, which also has its headquarters in Gibraltar.
Many other companies are also mulling over forming partnerships although nothing has been officially announced as yet. An industry expert said: “There seems to be three or four strong opportunities to buy into Atlantic City, so there is a lot of jockeying going on.”
While talking about New Jersey, a mention of PokerStars and its attempts to acquire a struggling land casino in Atlantic City has to be made. The online poker giant still hasn’t given up hopes of acquiring the land casino although a court has ruled that its $15 million acquisition deal with Atlantic Club Casino has expired. The Rational Group, parent company of PokerStars and sister site Full Tilt Poker, have appealed against this ruling. PokerStars has to partner with an Atlantic City Casino in order to gain a smooth re-entry into a regulated online gambling market in the US.
PokerStars cannot enter the Nevada online poker market because the state’s regulations have a “bad actor” clause, according to which companies that continued to offer online poker services to US residents even after the US federal government passed the Unlawful Internet Gambling Enforcement Law (UIGEA) in 2006 will not be issued an interacting gaming license in Nevada for a period of 10 years. In spite its $731 million settlement deal with the Department of Justice, PokerStars has no chance to getting a Nevada online poker license; it can only hope of partnering with an Atlantic City casino and getting into the New Jersey Internet gaming market.
Meanwhile Ultimate Gaming chiefs Tobin Prior and Tom Breitling have already stated that their company will apply for a New Jersey poker license and is “actively meeting with several casinos in Atlantic City and is speaking with multiple gaming operators in other jurisdictions about partnership opportunities.” Atlantic Casino companies such as Revel, Tropicana, and Trump Entertainment are also seeking partners at present.
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