In the year 2019, Pennsylvania gaming legislation became a reality. But it was a long time comin’.
In Oct. 2017, PA governor Tom Wolf signed a sweeping gambling expansion bill into law. In May 2018, the Supreme Court overturned PAPSA, the law which banned sports betting outside of Nevada.
While many are putting out “best of the decade” lists, Pennsylvania’s 2019 crammed enough highlights to deserve its own retrospective.
At the start of the year, Pennsylvania was home to only three retail sportsbooks and gambling was confined to brick-and-mortar casinos.
Today there are:
- 8 online sportsbooks
- 12 retail sportsbooks
- 5 online casinos
- 1 online poker site
It all adds up in the top five biggest stories for legal gaming and sports betting of 2019.
The advent of online sports betting
Retail sportsbooks opened and a few, like Rivers, SugarHouse, and Parx, invested big bucks in permanent, state-of-the-art spaces. However, judging by the numbers, sports bettors in PA prefer to to place bets on their phone as a whopping 84% of wagers in the state are placed on PA online betting apps.
SugarHouse rolled out the first online sportsbook at the end of May. It was joined the following month by BetRivers and Parx. FanDuel entered the market in July and has claimed the top spot for handle and revenue every month since August.
Wire Act woes stunt online casino launch
Thanks to an announcement during a Pennsylvania Gaming Control Board meeting in April, iGaming operators had July 15 circled on their calendars as its earliest “go-live” date.
What should have arguably been a mass launch of a number of sites instead amounted to two, with a third joining two days later. The casino sites debuted with minimal games, no blackjack, no live dealer, and none of the bells and whistles New Jersey online casinos have to offer.
Hollywood Casino and Parx were first to offer online casinos. SugarHouse joined a few days later. The fall of 2019 also saw Unibet and PokerStars enter the PA market.
The new Wire Act opinion issued by the Department of Justice at the start of the year is the culprit behind the online casino industry’s woes. More specifically, the Pennsylvania Gaming Control Board’s response to the opinion slowed things down.
PGCB Executive Director Kevin O’Toole requested each operator turn in a game plan to ensure 100% compliance with the newer, much stricter interpretation of the Wire Act. Both operators and game providers needed to stand up separate servers in Pennsylvania rather than share servers with New Jersey as many organizations planned.
Even after the courts sided with the New Hampshire Lottery, PA regulators continued to maintain strict operating mandates. The end result is an online casino industry with hampered growth and potential.
Sports betting may be exploding with online growth. Casino numbers, on the other hand, are a little more lackluster:
For the 2019/2020 fiscal year so far, beginning in July:
- Slots (online) revenue: $15.3 million
- Table games (online) revenue: $5.6 million
Online poker finally debuts
The internet in 2019 stoked the bottle cap challenge, Baby Yoda memes, and a world-record egg. It also had an ardent group of “When is poker launching in PA?” tweeters. “Coming soon,” seemed open for interpretation and rumors were simply that.
That was until Playin Pennsylvania exclusively broke the news of online poker’s impending entrance to PA. On Nov. 4, Fox Bet and PokerStars launched the much-anticipated game in concert with PokerStars Casino.
Appetite for online poker was real, beyond just a vocal minority of eager tweeters.
- $179,2000 was paid out during the PACOOP Main Event. It represented the largest prize pool of the series.
- During its first month, PokerStars PA rake and tournament fees nearly hit $2 million.
- PokerStars’ traffic in PA has far out-paced its New Jersey counterpart. Just checking in on an early afternoon on Dec. 26, PokerStars PA had 914 seats filled compared to 278 in NJ.
That pesky Apple problem
In yet another example of why you should always read print, a June update to the App Store Review Guidelines had a big impact on real-money gaming apps.
It said:
Guideline 4.7. HTML5 games distributed in apps may not provide access to real money gaming, lotteries, or charitable donations, and may not support digital commerce. This functionality is only appropriate for code that’s embedded in the binary and can be reviewed by Apple. This guideline is now enforced for new apps. Existing apps must follow this guideline by September 3, 2019.
It proved to be lousy timing for PA online casinos and sportsbooks who were planning summer starts. Especially since about forty percent of smartphone users own an iPhone.
A band-aid solution came via GeoComply which produced the GeoGuard Location Validator. The app verifies players’ locations and sends the data to the iGaming operator.
Also, Apple extended the September deadline six months.
Sports betting revenue smashes own records each month
Let’s look beyond the point spreads, moneylines and over/unders for some different kinds of sports betting numbers.
- 433%: The percentage increase in amounts of bets placed from July to November in PA.
- 416%: The percentage increase in sports betting revenue from July to November in PA.
- Since online wagering started in June, PA continues to break records for handle and revenue each month.
From numbers to letters, “b” was the letter of the month for sports betting in November.
It broke the $300 million threshold by taking more than $316 million in bets. Even more importantly, it hit the billion-dollar mark for bets placed in 2019.
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