Legislators in New York spent the greater part of 2014 finalizing the selection process for its commercial casino expansion. With that finally out of the way, regulators will have time to move onto other important matters in the upcoming 2015 legislative session. According to a new report from Gambling Compliance, those important matters will include hearings to discuss the legalization of online poker in New York.
Three states have already legalized online poker, including New York’s easterly neighbors in New Jersey. With a population of approximately 8.9 million, the revenue from the Garden State’s ring-fenced iGaming market has been underwhelming, but New Yorkers have made it clear that they desire the same regulated online poker market in their home state. With more than 2x the population of New Jersey (roughly 19.6 million), NY lawmakers will be taking a long hard look at the profit potential.
Studies have already been conducted regarding how much money New York might stand to make off a licensed online poker framework. MGM Resorts did not receive one of the three NY casino licenses, but is still interested in getting online poker regulated in New York based on the company’s consistent lobbying efforts in Albany, including the commissioning of the study in question.
MGM’s research showed that an estimated $110 million is being spent annually at offshore online poker sites by New York players alone. It was projected that a regulated online poker market would generate enough revenue to supplement the Empire State’s tax coffers with an additional $50-$80 million.
The Empire State saw its first online poker bill introduced in 2012 by Senator John Bonacic. The hopes of New York’s internet gaming fans were quickly dashed though when Bonacic, who serves as Chairman of the Senate Committee on Racing, Wagering and Gaming, made it clear that he had no intention to push the online poker bill that year. His purpose was to merely introduce the subject so that lawmakers would be aware of the issue once the plans for land-based casino expansion were complete.
Chances are, if next year’s hearings go well, a new measure will look very similar to the New York online poker bill introduced in 2012. Then again, that version was authored prior to the launch of online poker in Delaware, Nevada and New Jersey. Considering the current status of the markets in those states, New York lawmakers could throw in a few alterations in an effort to avoid some of the major problems faced in those jurisdictions (although they were primarily related to geo-location systems and software glitches).
As for when online poker might become a reality in New York, it’s hard to say. Morgan Stanley published a document earlier this year predicting a launch in 2016. A more recent study by Adam Krejcik of Eiler’s Research doesn’t expect New York to regulate online poker until 2019. Realistically, the deciding factor could be the speed at which regulated states implement shared liquidity between their respective markets. The lack of players pooling is clearly suffocating the networks’ ability to grow and generate more revenue.