Since the turn of the 21st century, the gambling industry has undergone a huge transformation. Governments have quarrelled over legalisation in a host of countries around the globe, and now the gambling landscape is almost unrecognisable to what it once was.
The big battle used to be between the gambling industry and regulatory bodies. Now land-based casinos and their online competitors are going head to head. While land-based casinos are the traditional way to have a flutter, online operators offer an engaging and immersive service that many players prefer to the real thing.
In this article, we look at whether the digital or physical world is driving the success of the $525 billion gambling market – and where the industry is headed in the future.
Where is the battle raging?
The UK is the best example of a country with a gambling industry where everything is legalised and regulated. This leads to a level playing field between land-based and online casinos – with both subject to the same rules, regulations and taxes.
The gross gambling yield of the UK from April 2017-March 2018 was £14.4 billion and the remote sector was the largest contributor to this figure. 37.3% – that’s well over a third – of the gross gambling yield came from the remote sector, bingo and online casinos.
The combined yields of all 152 casinos in the country were nowhere near as significant as the contribution of the remote sector. The widespread feeling among gambling experts in the UK is that advances in technology have led to the dominance of the remote sector.
Not only are players able to play their favourite games more conveniently than ever before, these games are stunningly high-quality, with fast interaction and incredible graphics. From blackjack, to poker, to slots and poker, you’ll see exactly how far online casinos have come by playing these online casino games.
Which types of online casino games are so popular?
Poker: The card game burst into the mainstream in the early 2000s, when online player Chris Moneymaker became a worldwide sensation. The accountant bluffed his way to World Series of Poker success in 2003 against seasoned card-shark Sammy Farha. This bluff, sometimes referred to as “the greatest bluff of all time” catapulted poker into the public consciousness. Popularity in the game soared – at the exact same time as the remote sector was growing in popularity. Millions of adults in the United Kingdom regularly play poker more than 10 times a year with an online provider. Poker player numbers in British casinos have been steadily decreasing in line with the rising popularity of the online variation.
Slots: This variety of game has long been the financial heartbeat of any gambling premises – on land or online. Of the £5.4 billion remote sector British revenues, £2 billion comes through slot machines. Improvements in graphics and user gameplay brought on by the competition of the remote sector has led to this increase in revenues. While strategy can play a part in your success in a slot game, there’s no skill required. The only thing that matters is the return to player percentage – which guarantees providers steady profits from every player.
Bingo: As the battle for market share rages on among online providers, companies are searching for new ways to attract customers and make money. A demographic previously overlooked by mainstream gambling companies was women. In the previous year British online bingo sites spent an estimated £38.3 million on TV advertising alone. Middle-aged women are among the highest growing demographic of gamblers in the UK – making them a key target audience for online operators.
Where is the new battleground for online v land-based casinos?
Many are expecting the US to usher in a new wave of online casino expansion. After all, it’s a country home to over 400 casinos and it’s regarded as the spiritual birthplace of modern day gambling – Las Vegas.
However, currently only a handful of American states have legalised online casinos and sports betting: Rhode Island, Delaware, New Jersey, Nevada, Mississippi and Pennsylvania. This was due to the Supreme Court’s groundbreaking decision to overturn the previous PASPA ban on sports betting in May 2018.
Many believe that the Trump administration’s financial reliance on a key supporter Sheldon Adelson is one of the many reasons behind the delay in legalising gambling outright. Adelson is the owner of Las Vegas Sands and recognises the threat that the remote sector poses to his land-based casino resorts – and he’s one of Trump’s main donors. With that in mind, Adelson has spearheaded an anti-online gambling coalition whose sole aim is to oppose legalisation in any form.
However, the benefits of online are becoming clear to the Trump administration. The current gross gambling yield of the United States is $495 billion. Conservative estimates suggest that the remote sector would add a further $170 billion to that figure in the first year of widespread legalisation. Something else the government is aware of is the fact that illegal sports betting is reportedly a $400 billion market – giving the White House even more of an incentive to act quickly and reap the benefits.
Can land-based casinos fight back?
A fight back from land-based casinos looks like an uphill battle, considering the shape of the gambling landscape at the current time. Even in Las Vegas, casinos are struggling to attract the new generation of customers to their resorts. Visitors number were down 3.3% quarter-on-quarter in 2018, plus tourists are gambling less.
Traditionally, land-based casinos offered an escape to customers and something different that they couldn’t experience anywhere else. Now the younger generation of gamblers are looking for experiences rather than just gambling – encouraging land-based venues to get creative to draw in more customers. One way they might make their physical spaces more appealing is through live music events and celebrity appearances – which was part of the charm of the initial Vegas era.
Alternatively, by dipping their toes into digital waters, land-based casinos might hope to innovate their way out of trouble. Much like some online operators are making use of physical touchpoints to broaden their audiences, many are hoping land-based casino operators will to diversify their offerings by utilizing the remote sector. After all, there’s nothing to stop land-based casinos using the remote sector to boost their own businesses.
The vice versa is already taking place. Online casinos are making a good go of offering physical experiences to their customers. Some of the largest online providers in the UK are combining the remote sector with land-based ventures. Events such as poker championships are hosted in land-based venues – while other online operators are developing technology to provide their customers with AR and VR casino experiences.
While most sectors have experienced a transformation in the digital era – this is true of gambling more than most. The remarkable growth of online casinos, from fledgling start-up entities to world-dominating billion-dollar listed companies, is a testament to that. It’s not just the ease and convenience with which players can gamble online – it’s the quality on offer, too.
However, land-based casinos are far from dead in the water. Sure, numbers are falling – but they’re still a valuable option for gamblers. The battle between online and land-based casinos rages on, and with the US on the precipice of sports betting legalisation, 2019 could be the most important year yet for the global gambling industry.