Pennsylvania’s First Year of Online Gambling: Valuable Lessons Learned

It is hard to believe that Pennsylvania’s online gambling industry launched in July 2019, and what an eventful fourteen months have followed, bringing us to September 2020. With the state’s regulatory body, Pennsylvania’s Gaming Control Board (PGCB), casino operators have reaped the rewards of legalized online gambling and its subsequent success. What can casino operators, those planning to enter this market, and other states prepare to legalize online gambling learn from the Keystone State? Lay sufficient groundwork July 2019 saw Pennsylvania’s online casinos open, but launches were not as smooth as everyone had envisioned. Not all operators could go live on the prescribed date and, even those that did had a limited number of games on offer. It seemed that insufficient planning caused this near disaster. The financial advantages were not immediately evident, either. Industry experts questioned whether online gambling in Pennsylvania was worth it, although they would soon have an answer to that question. Online gambling is a lifesaver No one could have predicted COVID-19 and its devastating impact on the casino industry. However, Pennsylvania online gambling operators were fortunate enough to be online already. As brick-and-mortar casino earnings plummeted after lockdown measure implementation, online gambling saw an unprecedented surge. Revenues generated online during pandemic lockdowns kept casino operators afloat, whereas they could have faced bankruptcy had all operations ceased. The current US economic outlook is cautiously optimistic, although recovering from millions of job losses will take years. Create a tax revenue stream Casino operators will push for low tax rates to bolster their bottom lines. However, Pennsylvania online gambling task teams set gaming taxes higher than expected, with some of America’s highest rates. Skeptics questioned whether these launches would go ahead as casino operators might balk at the imposed taxes, but they were wrong. It seems that the allure of tapping into a vast video gaming market justified paying high tax rates. Keep the rules simple State regulations can be an obstacle to online gambling success. As they legalize online casinos, states seem insistent on implementing unique rules that have left many operators scratching their heads. Pennsylvanian rules include a compulsory inclusion of land-based partner’s branding in online gambling platforms. This has been subject to private negotiations and agreements in other states. Additionally, clarity on this rule and its enforcement remain unclear. The lesson here is to keep regulations to a minimum unless they serve a concrete purpose.