New Jersey Online Gambling Brief: Trump Plaza’s Announced Closure Dampens a Strong Performance by iGaming Sites
In terms of how this week in New Jersey’s gambling history will be remembered, I’m inclined to steal a rather overused quote from Dickens’ A Tale of Two Cities:
“It was the best of times, it was the worst of times….”
Fans of casino gambling in New Jersey had equal reasons to celebrate and cry this week, as the online market’s strong showing was offset by the announcement that yet another Atlantic City would be shuttering its doors.
For employees of Trump Plaza, it appears that they’ll be joining the Showboat’s dealers, pit bosses and maintenance staff on the unemployment lines come this September.
The week didn’t start out much better for New Jersey’s iGaming sites, with the DGE reporting on Monday that Internet gambling revenues were down for a third consecutive month. But the bitter taste left in the mouth of PartyPoker NJ, WSOP.com and the like was eradicated by the strongest cash-game traffic surge in months.
Drama, intrigue, mountainous highs and heartbreaking lows – this week in New Jersey’s gaming history had it all. Let’s break it down.
Trump Plaza Readying To Close Its Doors
On Monday, more than 1,000 casino employees received notification that they would be losing their jobs. This, only two days after Trump Plaza’s owners confirmed that the long-standing staple of Atlantic City’s boardwalk would be shuttering up on September 16th.
Trump Plaza will likely become the third Atlantic City casino to cease operations this year. The Atlantic Club Casino welcomed its last patron on January 12th, and the Showboat is expected to close on August 31st.
Should the much maligned Revel not find a buyer soon, AC’s casino count will be reduced to eight, leaving upwards of 7,800 casino employees out of a job and starting a ripple effect that could stifle the region’s economy for years.
On a slightly brighter note, amid less competition AC’s other casinos could see their profit margins rise. But without the funds to properly market themselves, the gains could be minimal.
Reactions to Trump Plaza’s Closure
State Senator Jim Whelan (D – Atlantic County):
“It’s a disaster. This is going to impact all sectors of the economy, from big stores to real estate values and on and on.”
Donald Trump, who once was the figurehead for three Atlantic City casinos, including Trump Plaza:
“Atlantic City is getting clobbered. Seventy-five percent of the casinos in Atlantic City are bankrupt or going through bankruptcy. The other 25 percent are on respirators. This is going to happen in [the Philadelphia area] and Pennsylvania, too, you watch.”
On the latter point, I tend to agree with the Donald.
From Israel Posner, the executive director of Stockton’s Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism:
“You’re still looking at a $6 billion market. Just because you add more seats on the bus, doesn’t mean you have more passengers.”
Posner is responding to lawmakers who are lobbying for a casino to be constructed in Northern New Jersey. I can’t say I fully agree with Posner’s sentiments, particularly if the casino would be located near Manhattan.
Despite the influx of casinos on the East Coast, there isn’t a single full-scale commercial casino within 75 miles of its most densely populated areas – namely New York City and Bergen/Hudson County.
I believe there’s a reason why the millions of residents who live in these locales prefer Parx and Sands, and it has to do with them being 40 % closer (or more) than AC.
Build a casino in Northern New Jersey and rest assured, they will come.
What About Betfair?
So with Trump Plaza out of the picture, what happens to its struggling online gaming partner Betfair?
Two options. One is to pack up and leave NJ. Given Betfair’s other interests in the state, including a sponsorship deal with Live Nation and its online horse racing interests, that’s probably not going to happen – at least not without a fight.
Alternative two is to find another gaming partner. Considering that Betfair’s poker platform is a bust, its casino is underperforming and that every existing AC casino sans those either going out of business or bankrupt already have an established partner, that might prove tricky as well.
However, as reported by Chris Grove, the DGE “recently issued a regulatory update that allows IGP holders to utilize multiple platforms under a single IGP.”
To elaborate, before the amendment all of Caesars’ many URLs would have had to utilize 888‘s client. Now that that’s no longer the case, Betfair has a much better shot at retaining their NJ brand with a different permit holder.
New Jersey iGaming Revenue Down in June…
According to Monday’s press release from the DGE, NJ iGaming revenues were down again in June. This marks the third consecutive month in which the industry has failed to exhibit growth.
Granted, the spring and early summer months have proven notoriously tough on the online gaming industry, so some allowances should be made for the Garden State’s nascent market.
In total, the state’s poker rooms raked in approximately $2.05 million, with online casinos winning $7.5 mm. That marks a 9.92 % decrease from May, and a 36 % free-fall from March’s tallies.
The partnership of Borgata and PartyPoker still lead New Jersey’s online poker scene with a 52.5 % poker market share. That’s nearly 6.5 % more than WSOP / 888, which continues to gain ground on the state’s perennial market share leader.
Last place Ultimate Poker barely managed to tread above the 1 % mark.
…but Traffic Continues To Rise
Despite the foreboding nature of the DGE’s report, the situation in New Jersey is not nearly as bad it would seem.
In fact, since bottoming out in early-June, cash-game volume has been on the rise and gaining momentum rapidly.
On June 7th, 7-day averages across all NJ networks (according to PokerFuse Pro via PokerScout) reached a yearly low point of 304. But due to an influx of timely promotions, software updates and exclusive tournament series the market began to slowly rebound, growing 10.5 % in 30 days. And that’s with many of New Jersey’s regulars in Las Vegas for the WSOP.
This week saw traffic surge forward again, plateauing at 349 on Tuesday – it’s highest point since May 7. Granted, conditions globally have begun to improve as well, but at this point I’m sure the state’s iPoker operators will take whatever growth they can get, regardless of global conditions.
Given the recent turnaround, I would expect iPoker revenue to be slightly to moderately up for July.
On a Sad Note
Ultimate Poker’s cash-game tallies are no longer collected on PokerFuse Pro, which probably means that average volume on the site has fallen precipitously close to zero.
With monthly revenues at $30,000 and dropping rapidly, it’s hard to imagine UP being part of NJ’s iPoker industry much longer.
New Promos Abound
With the WSOP Main Event coming to a close, and presumably, New Jersey’s grinders back home, the Garden State’s poker sites have launched their latest round of promotions. Here are some of the most notable:
- PartyPoker NJ’s new player bonus
- 888’s Sit N Go 25% Cashback
- WSOP’s Summer App Dash
- Ultimate Poker’s Triple Play
The aforementioned promos are just a smattering of the great deals to be had in New Jersey this summer, and in my estimation are what’s driving traffic forward.
