New Jersey has had a tough time boosting its online poker market. While the overall igaming market continues to grow substantially each year, the online poker segment struggles.
The pandemic year of 2020 gave poker the boost it needed online, as it nearly doubled in revenue. But unlike the online casino games, poker couldn’t maintain its strength and has fallen in the two years since. This is despite it having been the only state to share online poker player pools with Nevada and Delaware via WSOP/888.
The bright spot is that Michigan just joined the Multi-State Internet Gaming Agreement, and PokerStars jumped in on January 1, 2023. The player pools have been solid, and WSOP and BetMGM are likely to follow suit by joining their sites from New Jersey to Michigan this year. That may be the revenue generator they’ve been anticipating for online poker.
For now, let’s look at the drop in online poker in 2022 as contrasted with the growth of igaming in general.
Casinos and iGaming Create Win
For the month of December only, the New Jersey Division of Gaming Enforcement showed a slight uptick in online poker revenue from November. Even so, it wasn’t enough to offset the negative months throughout the year.
-NJ peer-to-peer revenue (December 2022): $2,172,274 (up 1.8% from $2,133,529 in November)
The overall igaming market didn’t sail smoothly through the year, either, but its highs were higher than its lows. The worst month for the sector as a whole was February when igaming fell 5.7%, but it had two months of more than 8% growth each, leading to a mostly positive final quarter.
-NJ internet gaming win (December 2022): $151,455,493 (up 3.6% from $146,159,346 in November)
In the last four years, the disparities between poker and other casino games created two vastly different narratives.
Online poker hit its four-year peak in 2020 when the pandemic hit and online poker revenue nearly doubled. But it fell drastically in 2021 and a bit more last year. The other story, though, is that the overall igaming industry has done nothing but grow year over year. The pandemic year more than doubled online gambling in New Jersey, and the sector built on that growth for the two years since.
Milestones and Possibilities
State-regulated internet gaming is nearing its tenth anniversary, which it will celebrate this year. But in 2022, the gaming sector celebrated a big milestone. Internet gaming revenue hit $5B in September.
New Jersey is not the largest state for igaming due to its limited population, but it was one of the first states to embrace licensing and regulating online casino games and online poker for people within its borders. It helped encourage other states to do it, and as the first state with a broad igaming repertoire and multiple operators, it served as a template for other states. The New Jersey Division of Gaming Enforcement certainly deserves to celebrate that $5B milestone.
Meanwhile, there is a hopeful sign for online poker. New Jersey was one of the three initial adopters of the multi-state poker network, now called the Multi-State Internet Gaming Agreement (MSIGA). It’s been limited in scope thus far – Nevada has only one poker site, and other states needed to want to sign MSIGA – but the bubble finally burst in 2022. Michigan wanted to and did sign MSIGA.
On January 1, PokerStars became the first site to share online poker between New Jersey and Michigan, and it has proven successful thus far. Online poker revenue in the first few months of 2022 may see a spike from that liquidity. And it will only continue and hopefully increase when the WSOP and BetMGM launch their combined MI-NJ sites.
https://twitter.com/pokerprojones/status/1609608455853146113?s=20&t=BrFJ0FzNb25PFoO9618Orw
