CNBNews

In the evolving landscape of New Jersey's gambling industry, 2023 marked a significant milestone. The state's casino and sports betting operators, along with their online affiliates, accumulated a record-breaking $5.8 billion in revenue, an 11% increase from the previous year. 

Online platforms like Zodiac Casino are on the rise across the world, and New Jersey is no exception. However, this surge in digital gambling casts a shadow over traditional casinos, particularly in Atlantic City, where two-thirds are still grappling with reduced in-person winnings compared to pre-pandemic levels.

The Nuances of Digital Gambling Success

The data from the New Jersey Division of Gaming Enforcement paints a nuanced picture. While overall earnings soared, reaching a zenith unseen since 2006, only half of this revenue originated from the casinos' primary domain – their physical premises. This shift highlights a critical transformation: the burgeoning role of internet gambling and sports betting, which contributed nearly 46% of total gaming revenue for 2023.

Interestingly, only three of the nine casinos in Atlantic City – Borgata, Hard Rock, and Ocean – reported in-person earnings surpassing their 2019 figures. Collectively, casinos did exceed the 2019 in-person gambling revenues, but this success was primarily driven by the three newest establishments. Despite the highest in-person casino winnings in a decade, the underlying concern is evident: a significant portion of casino revenues now hinges on digital platforms.

This pivot to online gambling, though lucrative, introduces a complex dynamic for traditional casinos. The $1.9 billion generated from internet gambling in 2023, marking a near 16% increase from 2022, underscores this trend. 

Moreover, sports betting emerged as a powerhouse, contributing over $1 billion in revenue from nearly $12 billion in bets. However, this revenue is not exclusively for the casinos to keep, as it is shared with tech platforms and sportsbooks.

Each casino's performance varied, with Borgata leading in in-person winnings but showing a modest increase. In contrast, establishments like Harrah's, Tropicana, and Caesars witnessed a downturn in in-person earnings. When considering the internet and sports betting money, the landscape alters significantly. For instance, Golden Nugget saw a 15.5% increase, and Bally's earnings surged by 20.7%.

The rise of internet-only entities like Resorts Digital, which witnessed a staggering 50.4% increase, further accentuates the shifting sands. Conversely, Caesars Interactive Entertainment NJ faced a 20.7% decline, reflecting the volatile nature of the online market.

This digital shift, while financially beneficial, poses existential questions for traditional casinos. With a substantial portion of revenue now tied to online activities, the essence of the casino experience is evolving. The allure of physical casinos – the ambiance, the social interactions, and the tangible excitement – is increasingly supplemented, if not replaced, by the convenience and accessibility of online platforms.

The New Jersey gambling landscape is at a crossroads. As online gambling continues to expand, traditional casinos must adapt to this new reality. Balancing the charm of the in-person experience with the efficiency and allure of digital platforms will be crucial. The future of these establishments hinges on their ability to innovate and appeal to a broader, digitally savvy audience while retaining the unique appeal of the casino experience.