If a lot of states adopt online gambling in the next five years, they’ll make a lot of money.
That’s the conclusion of research from Morgan Stanley that says the online gambling industry in the U.S. could hit $5.2 billion in 2020 if at least 20 states have legalized online gambling by then. If all 50 states were involved, the estimate is $10.7 billion.
Right now only three states—New Jersey, Delaware and Nevada—have legalized online gambling. New Jersey sees the highest revenue of about $10 million a month. Nevada makes about $1 million a month and Delaware about$240,000.
But if more states come on board and join in combining player pools, revenues should grow considerably, the firm states.
Still, the report is seen as actually downgrading past estimates of the size of a potential online gambling market in the U.S.
“While we remain bullish on the online gaming opportunity in the U.S., we are lowering our estimates to better reflect the insights we have gained following the first few months of operations in NJ, NV and DE,” stated the report.
Though online gaming is being discussed in several state legislatures—including California, which is viewed as potentially the largest market in the U.S.—no state is expected to legalize online gambling this year. The report predicts no state will legalize online gambling until 2016.
The report also notes that the expected arrival of online poker giant PokerStars in New Jersey could substantially grow that market. PokerStars is expected to be approved in the state before the end of the year.
