When the most recent one-house budget proposals from the NY Assembly and Senate were released last week, it was noticeable that neither included legislation for the legalization of online casinos.
This will now be pushed back to 2024 at the earliest, but by then, there could be a compelling and irresistible case to push such legislation through.
After all, remote and in-person sports betting has continued to thrive since such practices were legalized in the Big Apple, with the vertical’s handle recently reaching $25 billion faster than every other state. Moreover, the vertical is expected to generate a further $2 billion each month during the 2023/24 NFL season, which starts in earnest in September.
Such success will enable NY to follow in the esteemed footsteps of the Canadian province of Ontario. But exactly how has this state fared in relation to sports betting revenue, and what can New York learn from Ontario’s journey?
A Look at the Ontario Marketplace
Ontario officially legalized sports betting and casino gaming in April 2022, becoming the first Canadian province to create a regulated, open marketplace that wasn’t controlled by the central government.
During its inaugural year of trading (up until March 31st, 2023), total stakes of $35.6 billion were wagered in the province, with this contributing total revenue of $1.4 billion for licensed operators.
Interestingly, it was the online casino vertical that dominated here, comprising $27.6 billion (78%) of total stakes and a staggering $940 million (or 67%) of cumulative revenue.
If we delve further into these numbers, we can see that approximately 48% of virtual casino wagers are placed on slot games, with live table game iterations accounting for around 32% of the total share.
In terms of 2023 performance, three months through June 30th saw Ontario iGaming customers wager $14.0 billion, with this number having more than trebled when compared with Q2 2022 (when the market opened for business and saw some $4.1 billion staked).
After winnings have been accounted for, Ontario brands generated cumulative revenues of $545 million, up 236% year-on-year amid staggering growth. Once again, casino games (and especially slots) dominated the figures, accounting for $392 million and around 72% of the quarterly market revenue.
Conversely, players wagered a relatively paltry $2.0 billion annually on sports while helping to generate further revenues of $138 million through licensing. Of course, this number is also expected to increase markedly through the remainder of 2023 and Q1 2024, creating a prosperous and well-regulated market that continues to deliver for the local economy.
But what precisely does this mean for the economy of Ontario? Well, the overall economic activity generated by iGaming has added an impressive $1.6 billion to Ontario’s total GDP in the first year of trading alone while creating around 12,000 full-time equivalent jobs for locals.
In total, the market has also delivered more than $900 million in labour income alone, while this type of trend shows no sign of abating anytime soon. In fact, the industry could expand to add an equivalent of more than 22,000 full-time jobs to the local economy’s payroll while eventually generating $2.1 billion in treasury revenue and boosting the province’s GDP by $4.7 billion by the year 2031.
What Economic Lessons Can NY Learn from Ontario?
The question that remains, of course, is what lessons can the burgeoning US market learn from Ontario, especially as it considers legalizing online casino gambling in the future. Let’s get into it!
1. Strike the Balance Between Revenue and Regulation
There is a long list of casinos in Ontario on the time2play.com website, but it’s interesting to note that the total number of sites active in Q1 2023 actually dipped slightly to 71. Despite this, the number of operators holding a license from the AGCO rose incrementally to 46, with this up marginally when compared with the fourth quarter of 2022. This highlights the benefit of regulatory control and how it can shape a high-quality market where the most trusted brands are dominant and most widely used.
2.The Importance of Choice
With the number of licensed operators in Ontario rising, punters have more choice over how they wager their hard-earned cash. This is crucial, especially given the global economic climate and the weakening purchasing power of international currencies. The NY market must strive to learn from this by ensuring that customers are able to select from a wide range of licensed operators and achieve the optimal value for their starting bankroll. This should certainly improve access to more competitive odds and generous welcome bonuses.
3. Understand the Role of Casino Gambling
In Ontario, it was online casino stakes that accounted for the vast majority of the market’s gross gaming yield (GGY), generating $27.6 billion in total and 78% cumulative wagers. So, while New York is already home to one of the most lucrative sports betting handles in North America, it will need to consider legalizing online casino gambling if it’s to realize the full economic potential of remote wagering. This will certainly optimize any positive economic impact and future boosts to GDP within the local economy.