iGaming Statewide (the U.S.)

iGAMING STATEWIDE (THE U.S.)

An Up-To-Date Guide

With iGaming regulations varying significantly from state to state while also developing separately from each other, the U.S. market is complex to navigate. What are the latest developments in the different sectors and states? Which operators are ready to enter the market? Where do the opportunities lie, and which states are on the back burner?

Online Sports Betting

With dozens of states legalizing sports betting, a multi-billion-dollar sports betting boom seems inevitable in the U.S. There are currently more bets being wagered on sports in New Jersey than in Nevada. The boundaries that once separated gambling from sports media and professional sports leagues are disappearing, and with digital apps making sports betting possible on mobile devices, the business of brick-and-mortar casinos is under threat.

The industry is poised for explosive growth. Full-scale regulated U.S. sports-betting revenue across 19 reporting states more than trebled year-on-year to $3.08 billion in the 12 months to June 2021, with online gross gaming revenue leaping by 312% to $2.61 billion. Like many online activities, lockdowns during the pandemic resulted in a huge boost for the iGaming sector. Going forwards, Goldman Sachs has predicted that the market could generate as much as $39 billion annually by 2033.

Currently, 25 states have fully legalized sports betting. However, their regulations vary heavily.

— Arizona is considered one of the major players, with the usual line-up of sportsbook operators (SBO).

— Colorado has seen massive growth in just a short period of time. Launching in 2020, it now has more than two dozen online SBOs.

— Illinois partially allows sports betting, with some prohibitive state laws, hopefully ending in 2022. eSports are currently not allowed.

— Iowa is a medium-sized proposition with more than 10 online SBO apps.

— Louisiana has six mobile apps and the law allows sports betting licenses for each of the 20 major gambling locations in the state. Only 55 of the 64 parishes have so far approved, but there is potential for expansion.

— Nevada is a state of opportunities: the original betting state, and the first to offer online sports betting of any kind. However, it remains a frustrating place to play due to its Draconian registration requirements. The state has the potential to become the undisputed number one if it can push through the necessary reforms. The expectations for sports betting in Nevada are high since reforms might take place in the near future.

— New Jersey, the current leader, and biggest player, has nearly two dozen SBOs, many with apps serving New York City. Regulators have already cleared four SBOs to launch their apps as soon as possible, while five more have already been licensed. Further growth is anticipated here.

— Michigan is also one of the top states for sports betting, with more than a dozen apps. The law does not prohibit any particular sports wager, only prop bets in collegiate sports are still not allowed.

— Montana is technically legal but extremely limited. Only a single app, and famously, offers exceptionally uncompetitive odds for betting through the state lottery provider.

— Oregon is also very limited. It is only possible to bet through its Scoreboard app.

— Pennsylvania is a prospect and has nearly a dozen apps. There are no restrictions on collegiate events or other sports in the state, only non-sporting events are not permitted.

— Tennessee now has more than a halfdozen options, including a local SBO. Inplay wagers on collegiate events are not allowed, but everything else is on the table. A growth prospect for the future.

— In Virginia there are eight SBOs, of which each one is a big name. Bets on Virginia universities are allowed, but tournaments are exempt from this provision.

— Washington DC is a rather complicated market. The only available app is operated by the DC Lottery. Caesar app operates only around Capital One Arena and BetMGM around National Park. Bets on DC universities or college games inside the district are not allowed.

— West Virginia has six different apps available that are all partnered with one of the five casinos in the state.

The two operators that are yet to launch in 2022 offer significant potential.

— Maryland continues to hammer out the final details on its sports betting launch, possibly towards the end of the year, and what's notable about this state is its sheer size. According to proposals, as many as 60 different SBOs could be based here.

— Ohio's new state law authorizes online sportsbooks that are tethered to brickand-mortar gambling entities in the state. This will be launched on January 1st, 2023, and has the potential to make Ohio a significant player in the market.

Online Casinos

With land-based casinos operating in the country for centuries, the U.S. has a long history of casino gambling. There are close to 400 registered casino hotels located in the U.S., with an estimated value of $54.8 billion in 2021, plus 465 registered non-hotel casinos with similar gross gaming revenue. The potential of transferring a part of that revenue online is clearly there, especially since legal online casinos continue to grow in popularity every year. Unfortunately, laws regarding the online casino industry are quite complex. Both federal and state laws determine what is allowed, and there are just a few states where legal online casinos are publicly available .

— New Jersey is home to more online casino options than any other state. The state was one of the first to legalize online casino gaming and now has nearly two dozen different apps.

— Michigan is a new online member but is already making great progress since its launch in 2021. There are more than a dozen casino apps, with options ranging from well-known big companies to promising smaller operators under the supervision of the Michigan Gaming Control Board.

— Pennsylvania's online offering has grown from just two online options in 2019 to more than twelve different apps available in 2022.

— West Virginia was one of the first states to legalize online sports betting and, at present, has four online casino options with more joining in the near future.

— Delaware is limited to just three online offerings, which are all hosted in association with its regulator Delaware Lottery, plus its size limits prospects of expanding its portfolio anytime soon.

— Connecticut launched in late 2021 with two online casino options plus the possibility to play online poker. The industry is limited to non-commercial tribal casinos and the state has not actually launched online poker yet.

— Additionally, there is a fair chance that Illinois and Indiana will legalize online gambling in 2022.

Online Poker

Things are changing fast for online poker in the United States.

Since the land-based casinos are worth around $100 billion for all games collectively, there is still considerable opportunity for operators to move a slice of the poker pie online.

There are currently only seven states with legal online poker games. New Jersey, Pennsylvania, Michigan, West Virginia, Nevada, Connecticut, and Delaware — plus legal, sweepstakes poker games in other areas.

Though the boom of 10 years ago is over, online poker for real money in the United States is on the rise again.

Conclusion

The growth of the legal sports betting industry and concurrent boom in iGaming revenue in the U.S. has seen it emerge as the key driver of growth in the global online gambling industry, presenting operators and suppliers with their largestever market opportunity. It allows them to dominate the development and future of the industry on both sides of the Atlantic. The market has an expected compound annual growth rate of 17.34% during the forecast period (2021-2026).

It is also notable that remote/mobile sports betting is the king of the hill in states where this is legalized. In New Jersey, Colorado, Pennsylvania, Indiana, Virginia, and Michigan, 90% of all wagers are placed remotely.

The legislation in the U.S., however, is perhaps the most complex in the world. Although gambling is fully legal under U.S. federal law, there are significant restrictions on a state level where each is free to regulate or prohibit the practice within its borders. Nearly every state has at least considered legalizing sports betting, but the reality is that full access will not come to more than a dozen states for a long time due to deep-seated political opposition to gambling or complex tribal relationships. A great example is Nevada, where the great Gold Rush started and could roll once again if allowed to do so. Sports betting should initially be allowed to proceed in the near future, but there is significant opposition to the online casino proposition.

We can conclude that the U.S. is, without doubt, the Lion in the game with the biggest roar. However, this lion is not that easy to tame. The market is difficult to navigate for operators, now and in the immediate future.