On Tuesday, the Senate Standing Committee on Racing, Gaming and Wagering met with FanDuel president Christian Genetski and DraftKings CEO Jason Robbins.
The topic of discussion was meant to be a review of mobile sports betting in New York, but it didn’t take long for the focus to shift to legalizing New York online casinos.
It’s no secret New York is missing out on large tax revenue figures by prohibiting iGaming. During the hearing, Sen. Joe Addabbo said:
“Every year we don’t do iGaming in New York, (the state) is losing roughly $4 billion.”
Addabbo even likened it to the days when NY sports betting was outlawed. Back when New Yorkers couldn’t access licensed sportsbooks, many took their action to illegal offshore sites. The same thing is actively happening with online casinos.
Howard Glaser, global head of government affairs for Light & Wonder, was given the opportunity to testify regarding the matter, and the points he made in favor of iGaming in New York were undeniable.
Glaser’s convincing argument for iGaming
Glaser’s company is a major provider of gaming services and equipment to every commercial casino, tribal casino and racetrack in New York. He said Light & Wonder’s video lottery machines generated $575 million for the state education fund in 2022.
In total, L&W’s machines have generated a total of $6.8 billion, according to New York Lottery reports.
Glaser cited these eye-popping numbers to illustrate how much money stands to be made from online casino gaming. Neighboring states such as New Jersey, Pennsylvania, and Connecticut have paired sports betting and online casinos, and revenue generation shows the real money is in iGaming.
“The states with iGaming have found that sports betting is the appetizer but iGaming is the main course, as far as revenue generation is concerned.”
Glaser projects if New York performed on average with the six states that have given iGaming the green light, it would make $425 million in annual tax revenue in year one. By year five, that total would skyrocket to $720 million.
Online casinos provide a boost to retail casinos
Glaser made sure to address the common misconception that iGaming has a negative impact on brick and mortar casinos. He said:
“We sort of instinctively think it must be like Amazon taking business from local stores. But iGaming couldn’t be more different. In fact, in every instance, iGaming drives revenue and job growth at land based casinos.”
Glaser said revenue in New Jersey, Pennsylvania and Michigan grew 51% after iGaming was introduced. In New Jersey, Atlantic City has seen a significant resurgence that times up with the debut of online casinos in the Garden State.
Retail casinos aren’t competing with online casinos. The two coexist and are extensions of one another.
Glaser finished his statement with this:
“The gaming industry has a simple message on iGaming: Regulate it. Tax it. Protect consumers. The states that do that see healthy brick and mortar casinos, dramatic tax revenue growth, and a secure online environment for consumers.”