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Pennsylvania's $60M Live Poker Market To Get Boost With Online Casino Legalization

States Becomes Just The Fourth With I-Gaming


Last week the state of Pennsylvania made history by becoming the fourth in the country to pass legislation to legalize online casino games, including poker. The bill, HB 271, now just awaits a signature or inaction by the governor to become law.

Gov. Tom Wolf is expected to sign, though there have been some calls for a veto. If it clears the governor, the Keystone State could have online casinos up and running within a year.

The legislation is great news for Pennsylvania poker players. The state’s 10 brick-and-mortar poker rooms raked $58.6 million in calendar year 2016, about $1 million more than revenue generated in calendar year 2015. Revenue is also flat this year. Online poker in the mix will grow the interest in the game. New Jersey’s i-poker market is worth about $2 million a month.

But the benefits go beyond non-house banked poker.

The regulated U.S. online gambling market (including the online lottery, which Pennsylvania also OK’d) could be worth $4 billion in just a few years. Estimates were slashed over the past few years, however, because it has taken much longer for more states to authorize the betting. Pennsylvania lawmakers considered online gaming for some five years.

Since January, HB 271 had a long and windy road to the governor’s desk. There was no certainty that the legislation was going to pass until last week when both the Senate and House agreed on the same version of the gambling expansion package. Online casinos are just one piece of the puzzle for Pennsylvania to generate new tax revenue, as well as grow its gambling market in the face of competition from nearby states.

Right now, the internet casino component of the U.S. online gambling market is worth around $250 million annually, with New Jersey controlling over 90 percent of it. Nevada (web poker only) and Delaware are the other two i-casino states. Nine states have i-lotto offerings.

New Jersey, Nevada and Delaware are soon to pool their players to generate more liquidity. If Pennsylvania joined the arrangement online casinos would be available in four states with a combined population of nearly 26 million.

Other states considering some form of online gaming in recent months include Michigan, Massachusetts, Illinois and West Virginia. California remains the most coveted prize for the industry, thanks to its nearly 40 million people, but the state’s land-based casino industry can’t reach a deal on internet betting.

In addition to i-casinos and the i-lotto, Pennsylvania’s gambling market is set to undergo some major changes. HB 271 also establishes regulation on daily fantasy sports and legalizes sports betting over the internet and in the brick-and-mortar setting should PASPA fall by the wayside.

Furthermore, the legislation OKs 10 “satellite” casinos for the state’s dozen brick-and-mortars, tablet gaming at airports and gambling machines at truck stops. There was some desire to allow video gaming terminals at bars and taverns in the state, but that component of the package was opposed by the casinos and wasn’t included in the final bill.