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On February 26, 2013, New Jersey celebrated a historic milestone. It was on that day that then
Governor Chris Christie signed Assembly Bill 2578, which legalized online poker and casino games in the state, into law.
Exactly nine months later the first regulated sites went live. And while the industry was not without its growing pains,
it has proven an overwhelming success, generating over $130 million for state coffers and contributing to the revitalization of downtrodden Atlantic City.
In this retrospect we take a look at some of the biggest lessons learned during the industry’s first five years,
paying particular attention to unexpected trends that threw analysts for a loop. New states considering
iGaming legislation can look to these examples in order to glean a better perspective as to how to max out their own industries.
Online casino is the new online poker
When Black Friday forced PokerStars, Full Tilt, and other major online poker brands out of the US in 2011,
players were rightly devastated. At the time, poker was something of a national pastime in the states,
and its sudden removal cost many residents their livelihood, and a significant number their jobs.
By 2013 online poker was well past its popularity peak, but that didn’t prevent players from becoming enthused about its return to New Jersey.
Unfortunately, these players were met with a hard reality early on, that this new online poker market was merely a shadow of its former self.
Most of the problem had to do with the capped liquidity of the NJ market. Prior to Black Friday, sites had a population reach in the hundreds of millions.
Now their reach was just under 9 million. Factor in the industry’s various early struggles (payment processing limitations, geolocation failures) and traffic and revenue quickly floundered.
During those early days, operators poured countless marketing dollars into poker (remember 888’s 80% rakeback deal?),
believing it to be the best use of their funds. They were wrong, and in being wrong they hindered the growth of online casino —
a vertical that did not depend on high liquidity for success.
Since, they’ve learned their lesson and online casino sites have thrived. In 2017, online casino accounted for a staggering 90.1% of industry revenue.
On February 26, 2013, New Jersey celebrated a historic milestone. It was on that day that then
Governor Chris Christie signed Assembly Bill 2578, which legalized online poker and casino games in the state, into law.
Exactly nine months later the first regulated sites went live. And while the industry was not without its growing pains,
it has proven an overwhelming success, generating over $130 million for state coffers and contributing to the revitalization of downtrodden Atlantic City.
In this retrospect we take a look at some of the biggest lessons learned during the industry’s first five years,
paying particular attention to unexpected trends that threw analysts for a loop. New states considering
iGaming legislation can look to these examples in order to glean a better perspective as to how to max out their own industries.
Online casino is the new online poker
When Black Friday forced PokerStars, Full Tilt, and other major online poker brands out of the US in 2011,
players were rightly devastated. At the time, poker was something of a national pastime in the states,
and its sudden removal cost many residents their livelihood, and a significant number their jobs.
By 2013 online poker was well past its popularity peak, but that didn’t prevent players from becoming enthused about its return to New Jersey.
Unfortunately, these players were met with a hard reality early on, that this new online poker market was merely a shadow of its former self.
Most of the problem had to do with the capped liquidity of the NJ market. Prior to Black Friday, sites had a population reach in the hundreds of millions.
Now their reach was just under 9 million. Factor in the industry’s various early struggles (payment processing limitations, geolocation failures) and traffic and revenue quickly floundered.
During those early days, operators poured countless marketing dollars into poker (remember 888’s 80% rakeback deal?),
believing it to be the best use of their funds. They were wrong, and in being wrong they hindered the growth of online casino —
a vertical that did not depend on high liquidity for success.
Since, they’ve learned their lesson and online casino sites have thrived. In 2017, online casino accounted for a staggering 90.1% of industry revenue.
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