How US businesses Are Set to Boom as Gambling Takes Off

Gambling

The gambling industry is huge. Globally, online casinos alone are worth around $377 billion to the economy. While online gambling was already on an upwards trajectory in terms of popularity, what the conditions caused by Covid have led to is an explosion in the numbers looking to gamble. With bricks and mortar bookies and land-based casinos out of the equation, online was the way to go. Many who have now experienced the thrill of online casinos are likely to continue long after the world emerges from the pandemic. 

Given the size of the US economy and the fact that it is seen as a forward-thinking nation, it is a little surprising to realise that this country has long been missing out. While legislators are softening their approach to gambling, and while there are a growing number of online casinos accepting PayPal, is the US about to realise the benefits that the likes of the UK have been experiencing for some time? 

The traditional US approach to gambling 

Gambling is not illegal in the US, despite numerous sources that claim this to be the case. When you look at the likes of the casinos in Las Vegas, it is apparent that these are operating within the laws of the land. What makes the US a little complicated is its vast size and the fact that each state has the ability to impose the laws that it wants to. While some had embraced gambling and sports betting, others had always actively discouraged this with their legislation. Despite this, the US gaming industry was worth an impressive $240 billion in 2017 and the activity contributed over $8 billion in taxes.

The stance against gambling comes from traditional views. There are those who are concerned that with gambling come certain behaviours. An association with addiction and crime are present. Regardless of the truth of these, the ideas were pushed and the legalisation of gambling, in certain states, would have been viewed as promoting these behaviours. What these people are no longer able to ignore is the worth of the gambling industry to the economy. The iGaming industry is set to soar and with this, there will be opportunities for businesses to benefit as well as huge tax revenues being generated. 

How change began

While the journey to online casinos being universally accepted across the US is still in its early stages, sports betting is a little further along. It was May 2018 that saw a historic decision being made. The US Supreme Court legalised sports betting across the entire country. It had been reported that while this activity was outlawed, Americans bet around $150 billion illegally each and every year. The act of legalising this allowed for regulation and also allowed for the country to benefit from a new form of income. 

While countries such as the UK have long enjoyed all that sports betting brings, for the US this is largely a new experience. Since the law change in 2018, the number of sportsbooks offered across the country has exploded. This has been a major step in terms of the entertainment industry as it has opened up a whole new marketplace where companies are keen to do business. Right now there are numerous British companies looking to breakthrough in the US and this can only be good news for all parties. 

What this means for casinos

With an acceptance of sports betting across the country, it would make sense to go further and to explore all that online and land-based casinos have to offer the nation. To effectively launch online casinos that are sufficient to keep up with the appetite of Americans, there will be a need to partner with European companies or even the need to buy them out. The truth is that it is the European iGaming companies that have huge back catalogues of games. They have developed these over a period of years and created an online casino experience that is nothing short of exceptional. 

While it seems to make sense to legalise gambling across the board, there is still an uphill battle to fully get there:

  • Hawaii and Utah have a complete ban on all forms of gambling both online and land-based
  • In terms of land-based casinos, there are two types: Commercial and Native.
  • You can find commercial casinos in just Atlantic City and Nevada
  • In terms of Native Tribe casinos, there are 524 of these spread across 20 states. They regulate themselves
  • States that have no land-based casinos at all are: Georgia, Hawaii, Kentucky, New Hampshire, South Carolina, Vermont, and Virginia 
  • Internet gambling is regulated in Delaware, California, Illinois, Indiana, Nevada, Iowa, New Hampshire, Pennsylvania, New Jersey, Rhode Island, West Virginia
  • It is a crime to gamble online in Utah, Washington, and Louisiana 

This is the backdrop faced by gaming in the US and shows how the road to full acceptance is a long one. The positive point to note here is that only a few years ago, sports betting faced the same opposition and was in a similar position. 

The future of iGaming in the US

There is no doubt that change is coming. Attitudes towards online gambling are already softening and the economic arguments are undeniable. As US citizens begin to look forward to gambling with a growing freedom, there are numerous opportunities that will appear for businesses. Sponsorship details can bring in millions of dollars to businesses as can partnerships with an industry that is becoming more acceptable.

Examples of how this is already working can be seen by looking at the NFL and the benefits brought about by legalising sports betting. 2021 saw the NFL enter into deals with three gambling companies: Caesars Entertainment, DraftKings, and FanDuel. These deals are said to be worth $1 billion over the next five years. This is just one opportunity brought about by legalising sports betting. Legalising gambling as a whole and accepting online casinos across the country will only lead to more.

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.