Study Shows that Pennsylvania will Likely Benefit from Regulated Internet Gambling

Last Wednesday, the Pennsylvania Legislative Budget and Finance Committee (LBFC) released the results of the research study conducted by Econsult Solutions of Philadelphia. The report provided positive insights about the effects of online gambling if recognized as a legitimate sector of the state’s flourishing gambling industry.

Aside from determining the potential monetary benefits that could be gained from permitting the operation of online casinos within Pennsylvania’s territorial jurisdictions, the research study also looked into how cloud-based gambling could affect the state’s 12 casinos in relation to its current operating conditions and revenue generating ability.       

      

According to the report, if online gambling becomes a regulated industry in the Keystone State, as much as $184 million could be realized in the first year of operation. The state could attain additional revenues of up to $307 million per year in the succeeding years, to which $178 million will come from Internet-based casino gambling and $128 million from online poker room operations.

 

Pennsylvania’s online gambling advocates are hopeful that the projected economic benefits presented by the study, could very well tip the scale in favor of legalized online gambling once the matter goes into voting in the state’s legislature. After all, state officials are anticipating that the expected budget deficit of more than $500 million would elevate to over $ 1 billion, in view of the fact that the Penn State’s tax collection last April did not meet the projected figures.   

 

The research report also shed light about the effects of Internet-based gambling on the state’s casinos particularly with regard to cannibalization of revenues; or that business condition in which a new product merely eats up the revenue gained from older products and not actually bringing an increase in customer base. The findings indicated that the effects of online gambling would be the opposite as there are certain factors in the online gambling market that would even complement land-based casino operations.

 

Online poker rooms for example gain revenues from holding online tournaments that usually culminate in live main championship events held for several days in terrestrial casinos. Another factor pointed out is the online casino’s offer of low-cost form of gambling entertainment and its ability to increase customer base. Online gambling sites allow the placing of smaller bets and have greater appeal to the younger set of legal-aged gamblers who have a penchant for real-money mobile gaming.    

 

The research study further pointed out that land-based casinos are bound to be hit anyway, because of the increasing competition posed by the continuing casino expansion movements in neighboring states like New York and Maryland. Although the advent of regulated Internet gambling in New Jersey is still a long way from the Garden State’s projected financial goals, the availability of online and mobile gambling in a nearby state could easily attract the Keystone State’s near-border and border residents to drive across and become part of NJ’s online gambling customer base.