New Jersey: The PokerStars impact on the numbers

By David Cook
While New Jersey showed via its March figures that it has broken the record for online gaming revenue once again, there was one particular event that occurred in the month that grabbed the attention of many.

Following the New Jersey Division of Gaming Enforcement’s (DGE) decision to grant PokerStars owner Amaya Gaming regulatory approval to operate in the state, Amaya fully launched the brand on 21 March. The approval was subsequently renewed for six months from 1 April, subject to further renewals.

The i-gaming win total of $15.5m topped the previous record of $14.7m set by February and marked the fifth consecutive month where a new record has been set. Total gaming win for the state was $202.97m, down 0.4%.

Given that the launch occurred with just 10 days of the month left and that the publicity surrounding the launch could ware off, we will likely have to wait until April’s figures are published to get a far clearer reading of the impact Stars has made on the market, but let’s take a look at what it has achieved so far.

Online poker

This is the field that has generated great intrigue. What we can initially see is that Resorts AC, which itself is new to the New Jersey i-poker market by partnering with Stars, generated i-poker revenue of $597,677 out of a market total of $2.46m, giving it a 24% share of the market.

Borgata, partnered with BwinParty, still topped the market with $1.03m, equating to a 42% share, while Caesars/Harrah’s, partnered with 888, ate up the remaining 34% with $830,007.

Considering that avid online poker players have been playing at other sites since the market launched in November 2013, it is likely Amaya will be taking great encouragement from early results showing that Stars is already making crucial inroads with poker. If the market share is at 24% after 11 days, then imagine where it could be after another 30 days when April’s results come in.

The record for monthly New Jersey i-poker revenue is $3.4m, set in January 2014, though that was when the Trump Taj Mahal was operating in the market in partnership with March 2016’s total is the highest to have been reported since April 2014’s $2.6m.

The latest rankings from PokerScout show that Stars is beating WSOP/888 NJ and Party Borgata NJ in cash game traffic rankings. At the time of writing, Stars has a seven-day average of 150 cash game players, while WSOP/888 has 140 players and Party Borgata has 95 players. While this is not including tournament players, it will be interesting to see how this could be reflected in April’s results. Cash game players will not tell you everything though, as Borgata is placed third in that regard and has held the lead in the market for some time with regards to revenue.

Online casino

It is not possible to know exactly what Stars contributed in this vertical, as the figures are only reported by Resorts AC, which is also partnered with Mohegan Sun Casino. What we do know though is that Resorts’ online casino revenue was $1.3m, virtually flat-lining with February's total but up year-on-year from $154,071, though that was before Resorts partnered with Mohegan Sun.

Amaya explained in its fourth quarter 2015 financial results that approximately 17% of total revenues for the quarter were made via real-money online casino and sportsbook and approximately 78% of total revenues were from poker. If a similar trend is likely in New Jersey and considering that the sportsbook is not being operated in the state, we can see that it was never likely to be as impactful on this space. New Jersey’s internet casino win for March was $13.05m, up month-on-month from $12.8m and up 20% year-on-year.

What next?

While it does not take a gambling industry genius to work out that the market’s performance is set to improve with Stars operating in it, the early trends show that in terms of overall market revenue, steady rather than explosive progress can be expected. However, with Borgata and Caesars/Harrah’s having collectively lost approximately $130,000 of i-poker revenue month-on-month (5% of February’s total), Stars already seems to be on its way to assuming the number one position in the online poker market.

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