Growth of U.S. Internet Gambling? Don’t Bet On It — Just Yet, Anyway

There wasn’t anything more hyped back in 2013 than the prospects for big profits from internet gambling.

Now, the foray seems to be fizzling.

“Efforts to allow internet gambling across the US have stalled, after a campaign backed by casino owners pushed back against industry efforts to allow more widespread wagering on laptops and smartphones,” says the Financial Times. “New Jersey, Delaware, and Nevada became the first states to liberalize online betting in 2013, prompting industry executives to predict that longstanding prohibitions on the practice would soon crumble as others followed their example.”

A year later, it’s documented fact that revenues from the three states that took the plunge are a fail when it comes to meeting those expectations.

Industry quarrels aren’t helping — the brick and mortar casinos were never fully on board — and have helped create obstacles to internet gambling expansion. Casino mogul Sheldon Adelson used his considerable industry weight to persuade the American Gambling Association board to withdraw any support for online betting.

But times have changed. The 1961 Wire Act, which prohibited wagering via electronic transmissions, was reversed in 2011 by the U.S. Justice Department.

Poor performance, though, for internet gambling is unequivocal. Take New Jersey, for instance — by far the largest market of the three test states. In 2013, the state logged just $111.8 million in revenues — a huge plunge from the projections of at least a billion by both analysts and state officials when the project began.

“Advocates of further US online expansion are now pinning their hopes on a renewed push in California to legalize online poker and an attempt by PokerStars, now owned by Amaya Gaming of Montreal, to obtain a New Jersey license after being denied in 2013 over previous run-ins with the Justice Department,” noted the Financial Times. “Should PokerStars be approved, it will operate an online poker platform in conjunction with Resorts Casino in Atlantic City. The success or failure of the world’s largest online poker operator is likely to determine whether internet gambling makes any more headway in the U.S. in 2015.”