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By all accounts, 2017 is going to be the year the number of states with legalized online gaming will increase.
According to industry analysts Chris Grove and Adam Krejcik of Eilers & Krejcik Gaming, at least one, and perhaps as many as three states will legalize online gaming in 2017.
No state has authorized iGaming since 2013.
The prediction was part of Eilers & Krejcik Gaming’s U.S. iGaming Industry Update – 2017.
When it comes to continued online gaming legalization in the United States, everything starts and ends in Pennsylvania.
“The only state-level story that matters for the regulated US online gambling industry in 2017 is Pennsylvania,” Grove and Krejcik wrote.
The belief is that Pennsylvania, and its sizable population of 12 million, will be the nudge other states need to jump on the online gambling bandwagon.
According to the report:
“If the state passes a bill to regulate, Pennsylvania could kick-start a long-awaited domino effect among other states.
But if Pennsylvania fails to act, it becomes difficult to see how regulated online gambling will be able to expand beyond the three states where it’s currently authorized.”
The Pennsylvania House of Representatives has already introduced a bill that would legalize online gambling, and legislation is expected in the Senate any day, which will consist of input from both Democrats and Republicans.
However, Eilers & Krejcik Gaming asserts that only one of these states is a legitimate contender:
“We believe New York could break through with a bill to regulate online poker in 2017. We are far less optimistic regarding California, where we see little hope for breaking a decade-long streak of legislative inertia.”
New York State Sen. John Bonacic has reintroduced his online poker bill that easily passed the Senate in 2016, but there is also some reason for pessimism for legalized online poker in the Empire State.
Pending daily fantasy sports litigation could put the brakes on New York’s online poker efforts.
Anti-gambling groups are challenging the method by which the legislature legalized DFS by calling it a game of skill, which happens to be the same approach the state is taking towards online poker. The presence of the lawsuit could be enough to stall online poker efforts.
If there are reasons for pessimism in New York, there also some reasons for optimism in California.
If PokerStars decides to give up on California (there are whispered rumors that this might be the case), the situation there could change dramatically according to Grove and Krejcik.
In addition to Pennsylvania and New York, Grove and Krejcik see Massachusetts as the third viable candidate for legislative action in 2017. And for good reason, as Massachusetts has a lot of irons in the fire.
In addition to an online gambling bill and the existence of a study panel looking into daily fantasy sports and online gambling regulations (Massachusetts legalized DFS last year with temporary regulations in place), Massachusetts is also considering expanding into online lottery.
The zeitgeist in Massachusetts says the state could make it happen in 2017, but realistically, online gambling in the Bay State might have to wait another year.
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Eilers & Krejcik singled out three other states as potential candidates for online gaming legalization. Those states are California, Michigan, and Connecticut.
Furthermore, they target as many as nine long-shot candidates where legislation has been introduced or where the right on-the-ground conditions are present for legislative action:
You can see my list of dark horse states here.
Hanging over everything is the possibility for negative action at the federal level.
I agree with the analysts’ assessment that Sheldon Adelson’s influence within the Trump administration is largely overstated. So is the potential for the Restoration of America’s Wire Act (RAWA) to gain traction in Congress, where it has been met with skepticism by Republicans and Democrats alike.
“The federal outlook for regulated online gambling involves a great deal of uncertainty,” Grove and Krejcik stated before adding, “But we believe that, in more worlds than not, regulated online gambling will not be a topic the federal government takes meaningful action on during the next four years.”