Read up on the latest Pennsylvania gambling industry current events (for February 2018).
Regulated online poker games could be available to millions of Keystone State residents as early as this year. Yet poker isn’t the only topic of discussion for many gambling industry representatives in Pennsylvania. Here is a look at several news topics that are having an impact on both land-based casino and regulated iGaming interests in PA.
Pennsylvania Satellite Casino Licenses
The sale of mini casino licenses in PA has been a resounding success for state government interests, attracting close to $120 million in upfront investment from brick & mortar establishments so far in 2018.
The map below shows how Pittsburgh and Harrisburg have been the most attractive metropolitan hubs for incoming satellite casino “center points” following the first four auctions conducted by the Pennsylvania Gaming Control Board.
- Yoe, York County – $50.1 million – Penn National (January 10th)
- Derry, Westmoreland County – $40.1 million – Stadium Casino (January 24th)
- New Castle, Lawrence County – $21.2 million – Mount Airy (February 8th)
- South Newton, Cumberland County – $8.1 million – Parx Casino (February 22nd) *
* Sands’ $9.9 million license bid was invalidated by the Pennsylvania Gaming Control Board on Wednesday, February 21st.
Although there are six remaining Category 4 licenses available, eligible candidates are quickly losing their appetite for committing blockbuster investment amounts into the PA mini casino business.
Only two bids were received during Wednesday’s PGCB auction, and the minimum amount to purchase one of the remaining permits will be $7.5 million unless the Board fails to attract those minimum bids before the “Round 1” process concludes. That outcome is looking more likely with each subsequent blind bargaining session.
The next Category 4 license auction is scheduled to take place on Wednesday, March 7th, in Harrisburg.
Parx Pushes Back Against iGaming Interests
Regulated iGaming stakeholders across the U.S. have found a new enemy to accompany commercial casino magnate Sheldon Adelson, entrenched tribal gaming representatives and politicians who support a federal online gambling ban.
Fresh off a new “What A Night” campaign managed by award-winning NYC ad agency BARKER, Bensalem-based Parx Casino has joined Grantville’s Penn National in a plea to regulators that would severely restrict the incoming Keystone State iGaming market.
Greenwood Gaming & Entertainment (Parx Casino’s parent company) wants to limit Certificate Holders (existing land-based entities that will purchase online poker, slots and table game licenses for a combined price of $10 million) to one skin while mandating that all subsequent branding of iGaming services revolve around the established brick & mortar businesses.
It is no secret that Pennsylvania’s large-scale gambling expansion, which was signed into law last October, has created a number of winners and losers within the industry.
Penn National found itself suddenly in need of shelling out over $50 million for the first satellite casino license in an effort to defend its established market surrounding Grantville.
Meanwhile, rival casino Mount Airy significantly benefited from a special “Sixth County” carve-out that enabled it to play offense by acquiring a mini casino license in close proximity to Pittsburgh and the Ohio border.
Yet it is the state of Pennsylvania itself which stands to gain the most through its redistribution of brick & mortar casino market shares and all-encompassing authorization of real money internet gambling offerings.
Pennsylvania Gambling Industry Will Be Competitive
Within a year, Pennsylvania gamblers will have the following state-licensed options to choose from:
(a) Land-based poker and online poker,
(b) Land-based slots and online slots,
(c) Land-based table games and online tables games,
(d) Land-based lottery and online lottery,
(e) Land-based horse racing pari-mutuel events,
(f) Land-based Video Gaming Terminals (VGTs),
(g) Daily Fantasy Sports (DFS),
(h) Mobile-based gambling at airports, and
(i) More brick & mortar choices that will consistently increase as more satellite facilities open up shop.
The Pennsylvania gambling industry could also soon offer:
(j) Land-based sports betting and online sports betting while facing,
(k) Increased competition from out-of-state options.
There is an undeniable threat of market cannibalization when patrons have such a wide range of licensed gambling choices available to them, and a limited amount of time/money to spend on each one.
In addition to this, unregulated video game gambling services hold a virtual monopoly on the “underage” punter market.
Fiscal Year 2018-2019 and beyond promises to be extremely competitive for the entire Pennsylvania gambling industry, with state regulators possessing unprecedented enforcement control through renewable operator/key personnel license approval processes, mandate of monetary fines, and an ongoing funding dependency that will motivate officials to exceed annual tax revenue benchmarks.
Pennsylvania Gambling Industry Analysis & Summary
It remains to be seen exactly how Pennsylvania iGaming media’s focus will adapt once the infrastructure is in place for online operators to sign up new players. Similar to New Jersey, the Keystone State’s regulated online gambling market could quickly mature in a few short years, which would leave only a brief window of opportunity for internet gaming sites to “pull out all the stops” on enticing new business.
The brick & mortar side of the industry will undoubtedly be forced to contend with market saturation unless Pennsylvania land-based destinations are able to significantly improve upon customer spend figures.
Read more Part Time Poker articles from David Huber
Pennsylvania Live Poker Revenue Numbers Analysis (Jan 28, 2018)
Michigan Regulated iGaming Study Guide (Feb 6, 2018)
Daniel Negreanu Addresses Online Poker Seat Scripting Concerns (Jan 21, 2018)
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