New Jersey to generate around US$370m in gross win in 2014
With all eyes turned towards New Jersey as it becomes the first sizeable US state in terms of population figures to regulate real money online gaming products, H2 Gambling Capital has announced that the Garden State’s newly-regulated “igaming market has the potential to generate in the region of US$370m in gross win, which will equate to US$300-315m in net win”.
In terms of product verticals, “casino products will generate approximately 63% of the gross win, with the remainder being derived from poker. This will mean that during the year igaming is expected to account for 11-12% of New Jersey’s total gaming business”, H2 explained.
As iGaming Business’s exclusive data partner, H2 Gambling Capital has provided a comprehensive scenario for the development of igaming in New Jersey in 2014 and beyond, but also cautioned that “all of the forecasts are dependent on all operators being up and running (six of the seven licensees were given approval to proceed with full real money operations following the five day trial period) and that there are no issues with payments that impact the ability of players to deposit funds on the sites. The latter could be a limiting factor on market size as it is understood that a number of banks and credit cards are currently refusing to permit igaming transactions even with New Jersey licensed”.
The full real money gaming sector (online and land-based) should generate approximately US$34m in New Jersey by the end of this year, although much will depend on the impact of the holiday season and “how hard companies will go out with their initial marketing/bonusing, given the importance of setting down a market in what is the first multi-product and multi-operator regulated igaming market in the United States. Our forecasts are based on a bonus rate of around 20%, making expected net revenues in the region of US$28-30m”, added H2 Gambling Capital.
Looking forward to 2018, H2 expects “the New Jersey igaming market to generate a gross win of US$526m gross/US$440-450m net as the winner/s have emerged and the level of bonusing has been reined in slightly. This would equate to circa 16% of total regulated state gaming revenues at the time, with icasino expected to grow faster than poker over the first five years of the market”.
Go to the iGB News Analysis section for the full article, graphs and key questions such as how profitable the NJ sector can be and the differences with European regulated markets highlighted.