Are Online Casinos Killing their Land-Based Cousins?

Discussion in 'Lets Talk about gambling and more...' started by Marina, Oct 21, 2014.

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  1. Marina

    Marina Administrator Staff Member

    Particularly in the US, there’s a heated debate as to whether online casinos are putting land-based casinos out of business. Of course, this is an ongoing global concern, yet, in the US, where manyof the land-based entities are operated by Native American tribes, and are a main source of income, it’s of great concern. After all, billions of dollars are generated yearly, which provide for theireconomic development and self-sufficiency. If this cash flow is redirected to other venues, it could be devastating for the people who depend on it. Around the world, there are pockets of people insimilar circumstances who are wholly reliant on upon revenue generated from land-based casinos. Aside from that, certain governments also receive taxes from the land-based outlets and may not generate any revenue from foreign remote casinos. For this reason, it’s worth examining whether more harm than good is coming from the recent boom in Internet gambling.


    Native American Establishments

    The National Indian Gaming Commission (NIGC) provides a wealth of information in regard to how much revenue their operations generate and where it goes. Founded in 1988, the organization regulates tribal gaming in the US. Over the past years, their revenue has continued to slowly increase, despite the rise of online gaming venues. In 1995, just as online casinos began to take off, they reported just shy of 5.5 million dollars in revenue. As of 2013, the number reached 28 billion dollars. When the stock market crashed in 2008, they saw a minimal dip in revenue, followed by two years of steady holding. Every other year during this span, their profits increased. Because the legality of online betting has been called into question, establishments that catered to US customers had to close up shop some years ago, but a few states allow it again. Although it’s been slow to catch on, dollars have begun to roll in. Many eyes have been on New Jersey, as initial reports showed land-based casinos were losing, while virtual gained. However, this may be indicative of a country-wide trend, as casinos across the nation have seen a decrease in revenue and have had to close their doors. On the whole, though, the Native American venues appear to be doing well, and many tribes are seeking to add in online options when local laws permit.


    It’s also been proven that each venue attracts different people. President and Chief Executive Officer of Boyd Gaming, Keith Smith, recently noted that 85-percent of the company’s online customers had not played at one of their land locations in at least two years. The company owns the Borgada brand and sees online ventures and an opportunity to grow the overall market. As of now, there’s also no indication of whether the overlapping 15-percent of players reduced time or money spent at the land-based casinos, either. Similar sentiments have been backed up by representatives from Dover Downs and Golden Nugget. Caesars Acquisition Co. executive, Mitch Garber, added in an interview that it’s been proven in the UK and Australia that online casinos don’t take revenue from land-based ones.



    Despite the fact that some are suggesting land-based operations suffer due to online ventures, others indicate the virtual experiences will encourage real-world visits. According to an AGA study, 55-percent of experts surveyed believe online operations will help brick-and-mortar establishments grow. Another study found that games of virtual poker might encourage gambling overall. A survey of New Jersey residents provided similar results. Although a small percentage of people planned to slow their visits to physical gambling outfits now that online gambling is legal, overall, people planned to increase the number of trips they made. Further evidence can be found in “Poker Players Rebuff Common Online Gambling Myths,” by iGaming. It seems that those inclined to poker games feel the same as well, and would want to play more live games once they got started on the net.

    While many markets are presently seeing a decline in revenue from brick-and-mortar establishments, it appears to be a sign of the times, rather than competition. More than likely, the decrease is due to a combination of economic troubles and changing interests of society. All current sources suggest that online gambling does not hurt land-based casinos at all. In fact, they may serve to boost their ability to generate revenue. With that said, groups that are playing both sides of the field are achieving good results. Despite the fact that income generated at physical locations is dropping, overall gambling revenue is up. For municipalities that depend on tax revenue generated by the industry, and communities that support themselves with it, remote casinos can only be a good thing. When easy-to-follow and cohesive legislation is paired with cross-channel gaming, everybody seems to win, especially those lucky enough to hit a jackpot, wherever they may be.
    Seaman63, Mike and Kotsy like this.
  2. Kotsy

    Kotsy Well-Known Member

    Being from the USA, I've visited land based Casino's that are owned and operated by the Native American tribes as well as others from private companies.
    My own personal experience is that the Native American ones tend to cost me more to play whereas the privately owned ones I can play for hours on a few bucks.
    The ones run by the Native Americans have so many rules in place. I think it's time that they all have the equal opportunities throughout the country. Why does one have special tax breaks and other incentives because they are Native American and the private ventured ones don't?

    Do I think online gambling has effected them? Absolutely. I truly believe this was a big part of many of the USA being blocked from playing online. Time for these politicians to stop playing their political card and do what many of the American people want.
    Seaman63, Marina and Mike like this.
  3. Seaman63

    Seaman63 Well-Known Member

    In my opinion online and landbased casinos do not compete. These are two totally different markets. People play landbased often to have a social component with it like meeting other people, enjoying the atmosphere or enjoying a good service from the host. It´s like going out and having fun. Playing online is relaxing after a hard working day or spending some quality free time during a day or evening. It´s more like "wellness gambling" just to have a good time at your own comfort.
    Mike and Marina like this.
  4. Marina

    Marina Administrator Staff Member

    First of all, I absolutley love "Wellness Gambling" :) Yes to gamble online is for me relaxing after work, having a little break, just sitting down in front of my pc, having a glass of wine and trying my luck on some online games.

    I cannot totally agree that online casino and landbased casino are two total different markets.
    You are partially right, but I think it depends on the type of player. I am the type of player who wants peace while gambling.

    I never went to the landbased casino for meeting other people. I went to the casino to gamble. I hated it if people were standing behind me, watching my game and sometimes tried to start a conversation.
    Then there were also people who watched you, checked how much money you put in the machine, and they just waited that you leave when they saw you are loosing so they could try their luck.

    It is a long time ago that I went to landbased casino, I have stopped to visit land-based casinos when I discovered online gambling.
    I enjoy online gambling much more than playing in a landbased casino.

    Well, as said already, it depends on the type of player. I am just not that kind of player who visits a casino to meet people or make friends.

    I guess there are still many people visiting landbased casinos and enjoying it.
    Seaman63, Kotsy and Mike like this.

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