JACK Entertainment executive says iGaming will destroy Ohio casinos
An executive at JACK Entertainment, an Ohio-based gaming operator that owns two gaming companies in the Cleveland area, said online casinos are driving brick-and-mortar casinos out of business, much like online shopping did to shopping malls.
Daniel Reinhard, senior vice president of government affairs for Cleveland-based JACK Corp., testified last week before the Ohio Gaming Future Study Commission, a legislative committee created last year. Reinhard said the operators of Jack Cleveland Casino and Jack Teaser Don Lacino strongly oppose efforts to legalize online slot machines and interactive table games in the Buckeye State.
"Just as online retail has destroyed local retail, iGaming will do the same in every logical scenario," Reinhard testified. "Online gambling will harm Ohio businesses and reduce Ohio jobs, Resulting in reduced capital investment and deterioration of Ohio’s existing tax base.”
Ohio's current commercial gambling industry allows players to play live dealer table games at four land-based casinos in Cincinnati, Cleveland, Columbus, and Toledo.Four casinos and seven racetracks offer slot machines, although table games are not allowed in the latter.
The 11-member study committee plans to submit any recommendations regarding gaming expansion to the Ohio Legislature by June 20, 2024.
iGaming Opinions
Reinhard told the study committee that there is a limited amount of free money available for gambling.
More gambling, coupled with the convenience of playing games at home via smartphones, will put physical consoles at a disadvantage in competing for those dollars. JACK employs 1,400 people and Reinhard believes jobs would be at risk if iGaming was introduced.
Every market has limits on discretionary dollars. Gaming is no exception. No matter what research is presented, online consumption is consuming and ultimately consuming retail business. ” added the JACK executive.
Other industry representatives in Ohio saw it differently. The study committee heard from representatives of MGM Resorts and Penn Entertainment, which support iGaming.
MGM operates the MGM Northfield Park Casino. The University of Pennsylvania operates two casinos, the Hollywood Casino in Toledo and the Hollywood Casino in Columbus, and two racetracks, the Hollywood Gaming at Dayton Raceway and the Hollywood Gaming at Mahaning Valley Raceway.
iGaming proponents cite recent research showing that online casinos can complement land-based gaming.
“Penn Entertainment supports the legalization of internet gambling as a growth catalyst,” said Jeff Morris, vice president for public affairs and government relations at Penn. “It can complement existing brick-and-mortar locations and increase gambling and related tax income."
iGaming and Retail
Last year, only five states had both commercial brick-and-mortar casinos and online slots and table games — Delaware, Michigan, New Jersey, Pennsylvania and West Virginia.
Two of those states, Michigan and West Virginia, saw individual gross gaming revenue (GGR) decline in 2023 year over year. Meanwhile, POGO revenue is soaring in every state.
In Michigan, commercial retail casino profits fell 3% to $1.23 billion, while iGaming profits increased more than 18% to $1.9 billion. In the Mountaineer State, profits at the state's brick-and-mortar casinos fell about 1%, while online revenue grew 20%.
In states where land-based casinos have managed to increase their GGR, their profits are far lower than those of iGaming.
In New Jersey, for example, casino revenue in Atlantic City totaled $2.8 billion last year, up 2.2% from 2022. New Jersey’s online casino revenue exceeded $1.66 billion, an increase of nearly 22%.
In Pennsylvania, GGR generated by traditional casino gambling was approximately $3.43 billion, an increase of 1.6% year over year. iGaming revenue grew nearly 28% to $1.74 billion.
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Source: www.casino.org
