iGaming, or iCasino, if you prefer. It’s talked about almost as an inevitability.
It is more profitable than online sports betting, its investor-oriented advocates say. In states where online sports betting has been legalized, iCasino is just the next logical step, they add. And, whenever the next economic recession or round of tight state budgets hit, there will be iCasino, waiting as a means for politicians to raise government revenues without having to raise taxes.
But before you rush out to put your money in the next big internet thing, consider another legislative axiom: No major bills will be enacted for an industry that is not united.
And the casino industry is not necessarily united on iGaming.
Indeed, some of the casino operators that invest hundreds of millions and billions of dollars in their brick-and-mortar entertainment palaces, and which employ tens of thousands of workers in good-paying jobs, might have some misgivings about giving life to a creature that could become a monster that devours them.
For evidence, look no further than the big casino and iGaming states with sufficient history, such as New Jersey and Pennsylvania, where digital gaming soars while land-based lags. Indeed, in New Jersey, digital (casino and sports betting combined) now generates more revenues – though not more jobs and capital investment – than brick-and-mortar gaming.
One of the most outspoken opponents of iCasino is John Farahi, CEO and, with his family, principal owner of publicly traded Monarch Casino.
Farahi puts his opposition in moral terms citing what he calls the devastating impact of iCasino on society. Recent studies done since the spread of iCasino show its negative impact on individuals and on people, generally, in a country where 60 percent of the population lives paycheck to paycheck, he says.
Speaking as an émigré from Iran who is a naturalized American citizen, Farahi also talks of personal commitment: “We all have a responsibility to this incredible land” to avoid an industry that leads to financial ruin, even suicides, he says.
Farahi, however, also talks in financial terms of interest to investors.
What happens, he asks, to an industry and its capital investments that is fighting over the crumbs of a business where two or three operators control 70 percent of the revenue?
The result is already clear, Farahi says. Many brick-and-mortar companies are not reinvesting in their properties. And those properties are losing ground financially.
Even the big boys in brick-and-mortar, as Farahi calls the largest publicly traded casino operators, are feeling the impact even as they try to capitalize on iCasino, he says.
Farahi makes a distinction between online sports betting and online casino, though he says the former comes at greater costs to customers than in-person sports betting.
An illustration of possible future battles over iCasino just came in Colorado, where Monarch operates one of its two casinos (the other being Atlantis in Reno). Online sports betting has been legal in Colorado for a while, but not iCasino. And the casino association just voted 5-2 against legalizing iCasino. Among the “no” votes, Farahi said, was Penn National, which has its own digital gaming operations elsewhere.
So, the effort to extend iCasino to more states may present a dilemma for legislators who hear the siren call of iGaming to generate revenues but also see the sailors of existing brick-and-mortar taxpayers and their employees dashed against the rocks.
