Ever since the US Supreme Court took the unprecedented decision of making sports betting legal for any states that cared to do so there has been a distinct step change in the US. Not only do 39 states now permit online sports betting, eight (soon to be ten) have also started to allow online casinos to operate too. Therefore, this is seen as something of a pivotal moment. One in which the whole betting landscape of the US could be undergoing a fundamental change.
The one state that many people are focusing on at the moment is California. As the country’s most populous, with upward of 40 million inhabitants, if we were to come on board it’s felt many others would follow. Unsurprisingly, it would also mean that record-breaking gaming revenues, possibly even exceeding those of Nevada, could well be on the horizon.
That said, of all the states in the country yet to legalize online casinos, California is some distance from making this a reality.
Why California?
There are a number of reasons why the Golden State represents such a good opportunity to create a huge online casino market and we’ve already mentioned one of them. Of the state’s 40 million inhabitants even if only a quarter of them participated it would still be more than the whole population of New Jersey playing online.
What’s more, the demographic age profile of California is younger than many and it’s Gen Z who are allegedly driving the boom in online gambling. Alongside this, the population is undoubtedly up to speed with all the latest technological innovations and have the digital infrastructure to match.
And, as the unofficial entertainment capital of the US, Californians are always on the lookout for new diversions and ways to spend their leisure time. So the conditions all seem to be aligning to create the perfect environment for a vibrant online casino market.
Learning by example
California has always liked to regard itself as a leader, not a follower. But in this case it may have to agree to be the latter – although this needn’t be a cause for concern. Of the states that have already allowed online casinos there are many valuable lessons to be learned. One only has to look at the aforementioned New Jersey as well as Connecticut and Pennsylvania to see how quickly a well-regulated and successful online casino market has been established.
There has also been a proliferation of operators keen to enter the market and many of the newest online casinos are already enjoying great success in these states. With its far larger population, and corresponding economy, California stands to dwarf all others if the sector could be allowed to take off.
But . . .
This all sounds fine and optimistic. But there are certain factors that may slow or even prevent the process of liberalisation.
The first of these is the prevailing attitudes to gambling in general. For a state that is fairly free and easy in its approach, for example by being one of the first to legalize recreational marijuana, the opposite is the case here.
Gambling is currently banned with a small number of exceptions. The first is in the case of the numerous tribal casinos allowed to operate and the second is the state lottery. In both of these instances, this is thought to be justified as a proportion of the money raised goes towards paying for services like education and social care.
Then there are the licensed card rooms across the state, however these have recently been placed under greater restrictions than ever thanks to the effective lobbying of representatives of the tribal casinos who have always considered them to be a competitive threat.
Finally, betting is allowed on horse racing but, unlike 39 other states in the country where it’s now permitted, all other sports betting remains against the law.
Other advantages
Proponents of online casinos have put forward many counter arguments outlining the benefits that online casinos could bring, beyond the obvious one of creating tax revenue for the state and potential employment opportunities.
And, rather than alienating tribal casino operators, they could have a role to play in the new online environment. For example, in Wisconsin tribal casinos are being used a hub through which online operators are accessed, receiving a cut of the profits in the process.
For operators like FanDuel and DraftKings who are already succeeding in other states there are certain considerations to take into account. The market, if it emerges, will be competitive so user experience will be key – as well reassurance that the platforms are safe and secure.
But get this right and they, and other operators, look set to enjoy a gold rush the like of which California won’t have seen since 1849.
