Which iGaming Sites Will Most Help PA Reach $1B In 2021 Revenue? That’s Hard To Say

State's 17 iCasinos are collectively successful, but individual numbers are hard to compare
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Pennsylvania’s 17 online casinos are on pace to win more than $1 billion collectively from digital-oriented gamblers this year, but it’s hard to tell which sites are getting the biggest share of action.

Unlike mobile sports betting, for which the Pennsylvania Gaming Control Board’s monthly revenue reports identify each of the 13 operators, multiple iCasinos can be lumped together in the revenue reported for a single licensee. That’s because there is no limit on how many online casinos can operate under the license held by one of the state’s brick-and-mortar casino operators.

The companies with land-based casinos are free to make whatever financial arrangements they choose with online gaming companies to provide an outlet for the latter to operate in Pennsylvania. Such iGaming sites must be tethered to an existing brick-and-mortar casino operator rather than being able to launch on their own in Pennsylvania. A land-based casino may also have its own online operation, but it can enter partnerships with specialists in the digital gaming world that enable it to come out ahead financially even by increasing the online competition.

So when Penn National Gaming’s Hollywood Casino showed up in the June report as the state’s top revenue producer with $34.9 million earned from online slots, table games, and poker during the month, it didn’t mean the single, long-running Hollywood Casino online site itself garnered all that activity and all those dollars.

The $34.9 million came from a combination of the iGaming sites of Hollywood Casino, DraftKings, BetMGM, and Penn National’s Barstool, all of which fall under the interactive gaming license held by Hollywood Casino at Penn National Race Course in Dauphin County.

By the same token, when Rivers Casino Philadelphia showed up second in the June report with $23.3 million in iCasino revenue, that reflected the combined success of the PlaySugarHouse and BetRivers sites of Rush Street Interactive and of Borgata online casino.

The 17 sites fall under 10 licenses

Penn National Gaming and Rush Street Gaming (owner of both Rivers Casino Philadelphia and Rush Street Interactive) are the only companies with more than two iCasinos falling under their licenses (at least for now).

Valley Forge Casino Resort, owned by Boyd Gaming, hosts both the FanDuel online casino and Stardust iCasino, which launched in April. Combined, they generated near $15 million in June revenue.

On a far smaller scale, Live! Philadelphia is also the licensee for two sites: its own PlayLive! iCasino and the site of Betway, which only began operations June 28. Combined, they brought in nearly $750,000 in June.

The other sites are all single operations connected to one Pennsylvania casino:

* Stars Casino of PokerStars (through Mount Airy Casino Resort’s license): $5.9 million in June revenue

* Parx online casino: $3.6 million

* Unibet (through Mohegan Sun Pocono): $2.1 million

* Caesars online (through Harrah’s Philadelphia): $1.7 million

* Wind Creek Bethlehem online casino: $1.3 million

* TwinSpires (rebranded from BetAmerica, licensed through Presque Isle Downs and Casino): $0.5 million

Sites have more than quintupled since the start

The online casino gaming that began with three sites in Pennsylvania in July 2019 did not much resemble what’s available today, considering the expansion in both the number of operators and what they offer.

It was typical for a slots menu to have just dozens of games initially, compared to several hundred offered by some of the same operators in New Jersey, which launched iCasinos in 2013 and now has 34 sites. Over time, with more games getting more approval through the laboratory review process of the Pennsylvania Gaming Control Board, the menus have grown.

PlaySugarHouse, BetRivers, and BetMGM all show up with more than 200 slots options now, and nearly every other site has more than 100. There is common overlap in the games showing up on the sites, as they all have traditional games like Triple Diamond and more animated ones like Gonzo’s Quest.

In addition, they all have similar table games options for blackjack, roulette, baccarat, and similar versions of video poker. In most cases, they also share platforms with sportsbooks run by the same operators.

And notably, while live-dealer games only began showing up on four sites last October, those are now carried by all of them except the Wind Creek and Betway sites. Actual dealers from an Evolution studio in Philadelphia interact with players involved in games that can now include blackjack, roulette, baccarat, three-card poker, and Ultimate Texas Hold’Em.

Trailing New Jersey, matched by Michigan

Pennsylvania is one of just three populous states to have legalized iCasinos. New Jersey was the first, and with a more mature market and double the number of sites of Pennsylvania, the industry there is racking up more than $100 million in monthly revenue.

Michigan only launched this year but has quickly matched Pennsylvania, with its 14 sites generating $89.2 million in June compared to the Keystone State’s $88.9 million.

When Pennsylvania’s revenue exceeded $100 million for the first time in May, reaching a record $101.3 million, it seemed the state might be on a trajectory to match New Jersey. June, however, brought an unexpected 12.2% decline in the sites’ combined revenue.

Still, after generating $897.2 million in the just-completed 2020-21 fiscal year, iCasinos are on pace to easily clear $1 billion in the current calendar year. They made $538.8 million from January to June, and about 42% of the revenue ends up diverted to government revenue from the state’s relatively high tax rates (54% for slots play and 16% for table games).

What’s unclear is whether the amount of play and revenue, which grew substantially in the early months of the COVID-19 pandemic, have reached a plateau. The June revenue was the lowest since February, even with several sites (Borgata, Barstool, Stardust, Betway) having been added in recent months.

Even if the activity grows no further, though, it offers an example that other states may wish to follow, considering the vast sums generated for operators and the state alike.

Photo: Shutterstock

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