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Jul
26th

Will Internet Gambling Hurt Atlantic City ?

In New Jersey Atlantic City casinos are hoping that the legalization of internet gambling will help them to fend off competition from casinos in Pennsylvania, Delaware and Maryland. The move will give players another option since they will be able to play from the local coffee shop or while sitting in their favorite chair at home. New Jersey plans to offer players a variety of games including internet bingo. Some experts say that they do not know whether online gambling will help or hurt Atlantic City casinos. The casinos are an important part of the New Jersey economy and have been having financial troubles ever since casino gambling was legalized in neighboring states.

Casinos say that legal internet gambling will allow them to take advantage of the technologies that banks and other businesses rolled out years ago. One chief concern is whether players will like online gambling so much that they stop going to casinos and stay home which would leave Atlantic City casinos no better off than they were before online gambling was legalized. One expert says that casinos need to convince players that use their gambling websites to visit the casino. Patrali Chatterjee, an associate professor of marketing at Montclair State University, has done research into the potential effects of online gambling. Chatterjee said “That’s the big challenge that casinos face: to what extent can they make the transition from bricks-and-mortar to online seamless?”

According to the American Gaming Association internet gambling in the US generates $6 billion annually via 1700 illegal offshore sites that pay no taxes in the US. The lack of a regulated market leaves Americans open to fraud theft, identity theft and worse. New Jersey officials have high hopes for internet gambling. The state plans to tax online gambling at 15% compared to the 8% paid by casinos. Christopher Jones, an analyst who follows the gaming industry for Telsey Advisory Group in New York, is optimistic and told reporters “It will certainly increase the value of the licenses and assets of casinos in Atlantic City. Sort of the unknown — and most people don’t seem too worried about this — is, how much does it cannibalize their existing operations?”

Online gambling could really pay off for casinos in AC if it becomes a way for casinos to attract new players. In addition to games casinos could offer special promotions for hotel rooms, entertainment and gourmet dining on their websites. Jeremy Aguero, principal analyst for Applied Analysis, said “There’s a lot of people that believe that the development of online gaming is going to be the end of bricks-and-mortar gambling. Fair enough. I guess we’ll have to see how it plays out. But I think what both sides agree is that it’s coming, one way or another. We’re either going to figure out how to take advantage of that, or we’re going to be left behind.”