US online gaming growth slowed by illegal activity – experts

20 May 2014

A number of industry experts have hit out at the negative impact illegal activity is having on the growth of online gambling in the US market.

One year since the first legal online poker company in the US opened up its services to legal players, the industry’s growth has been hit by a number of factors, including various technical issues such as laws limiting players to access such services in the three states where internet gambling is legal.

Nevada, Delaware and New Jersey remain the only US states to have legalised internet gambling, but have all made a slower start than many had imagined with gaming revenue lower than initially expected.

The Associated Press news agency reports that David Rebuck, director of the New Jersey Division of Gaming Enforcement, believes online gambling exists in all 50 states through illegal offshore operators.

Rebuck said that his state recently issued cease-and-desist letters to out-of-state gambling companies marketing to New Jersey residents, citing the law that states online gambling can only take place within the state’s borders.

Despite the relatively slow start for US online gambling, many panellists and financial institutions still expect the market to pick up.

Multinational financial services corporation Morgan Stanley predicts that the legal online gambling in the US will generate $8 billion per year by 2020.

Elsewhere, Eamonn Toland, president of the North American arm of the Irish bookmaker Paddy Power, also spoke of his excitement about the market’s potential.

“We think what's happening in the US is the single most exciting happening in iGaming in the world,” Toland said.

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