The first half of 2021 was golden for Golden Nugget Atlantic City’s online subsidiary, Golden Nugget Online Gaming (GNOG).
GNOC, which has dominated iGaming in the market since it came online in 2013, won $182 million in the first six months, up more than 21 percent from the prior year.
Good news, to be sure, but not good enough for Golden Nugget to retain its No. 1 position. That honor went to Borgata, which won $190.5 million, a gain of 137 percent over the same period in 2020. BetMGM and Borgata-branded products are a big reason behind the tremendous growth in online gaming at Borgata, the consistent leader in land-based revenues.
What’s more impressive for AC is that the five of the first six months of 2021 produced online gaming revenues of $100 million-plus, citywide.
Two mobile sportsbooks, PointsBet and FanDuel, just added new online casino apps. PointsBet went live July 23 in an association with Bally’s Atlantic City; the casino is prepping for its big entry as Bally’s Interactive, with the Bally Bet brand as the centerpiece.
A few days later, on July 27, FanDuel launched an online casino in New Jersey through the Golden Nugget. It includes blackjack, roulette, slots and video poker, with the casino accessible through the FanDuel sportsbook app.
iGaming a Lifeline in 2020
Of total revenues for June, land-based results accounted for 62 percent of the total, while online gaming represented almost 31 percent. June’s casino win was $214.5 million, yet internet gaming still exceeded $107.1 million.
According to PlayNJ.com, all but one New Jersey operator reported online casino revenue of $5.7 million or better in June. Ocean Casino Resort was the only one not to hit the mark, reporting $1.2 million—though that figure was up 17.3 percent year-on-year. Online gaming also beat out sports betting. In June, New Jersey operators won $71.3 million on sports bets—well short of the total for online gaming. And for the year so far, sports betting has accounted for $368.3 million, but online casinos produced $634.2 million.
It’s indisputable that online played a key role in keeping the city’s nine casinos afloat during the Covid-19 shutdowns. For months, gamblers had no brick-and-mortar options; when properties reopened, they faced capacity restrictions. The question for operators was, with those days over, would the public prefer iGaming at the expense of casino visits?
The concern seems unfounded. “There was always the fear that the online business would take away from the in-person business, but so far, that doesn’t appear to be the case,” according to Michael Busler, professor of finance at New Jersey’s Stockton University.
Another potential concern was the impact online play might have on non-gaming amenities, which have traditionally depended on casino visitation. Not to worry there either, said Robert Ambrose, a former Atlantic City casino executive and current educator in hospitality and casino management.
“In recent years, non-gaming has established its own footprint with diversification in dining, retail, lodging and entertainment. It’s its own very marketable independent profit center,” exclusive of gaming, he said.
A Net Positive
What this means for the rest of the summer and beyond, with brick-and-mortar casinos operating on all cylinders, isn’t easy to forecast, Busler said.
“So far it appears that gamblers strongly prefer in-person,” said Busler, “because not only can they gamble but they can take advantage of the shopping and entertainment venues the casinos offer.” Right now, there’s that oft-cited “pent-up demand”; after months of being shut in, people just want to go out and play.
Going forward, Busler suspects gamblers will partake of both online and retail gaming. “Determining the mix between the two may be difficult to predict, but in the end both online gambling—and sports betting—will be a net addition to the revenue streams.”
Older customers favor the brick-and-mortar for the hands-on experience of gambling. “Many are not comfortable with or even trust online options,” Ambrose said. “The social aspect of the physical casino environment is a market draw for those generations.”
Younger gamblers see digital play as almost second nature, so expect that to factor into the equation, Busler said. ”I suspect online gambling revenues will continue to climb before a plateau is reached.”
Atlantic City has always been a tale of two models playing against each other, Ambrose said. In the 1970s, with its glory days long past, it was a tired-looking seaside resort making way for a new version of hospitality that included casino gambling.
Complementary Models
“We see a historical transition taking now, with the decades-old model of face-to-face casino gambling and resort destination moving to an expanded and virtual level of the customer gambling experience.”
Online gaming “was already establishing itself as a profitable model prior to the pandemic. It will continue to grow and so will the related technology that drives it. It’s becoming more mainstream every day. The numbers speak for themselves.”
Ray Stefanelli, newly appointed vice president of online gaming for Hard Rock Hotel & Casino, which opened in 2018 on the site of the former Trump Taj Mahal, said online gaming is “just another opportunity for players to connect to Hard Rock offerings.
“In addition to playing slot machines or table games—or betting on sports—customers can play from the comfort of their own home.”
If rising Covid infections lead to future shutdowns, the option will once again be critical.
