Borgata Topped NJ Online Gambling Charts In 2016, But Lead Is Slipping

Can An MGM Online Casino Turn The Tide For Borgata’s Online Gambling Arm?

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Now that MGM Resorts International has taken full control over the Borgata in Atlantic City, it’s plausible that the operator will soon become a fixture of the NJ online gambling industry.

MGM bring strong branding and a wealth of experience to the table, rendering it one of the few non-local brands that could have a substantial impact on NJ industry revenue.

That’s much needed good news for the Borgata, which has witnessed its online casino and poker revenue sputter of late.

Borgata online gambling revenues fading fast

The Borgata AC may have posted the highest online gambling revenue of any licensed operator in 2016. But relative to the industry, it’s on a downward trajectory.

Last year, the operator registered gross online gaming revenue of $45.82 million. That represented a scant 3 percent uptick over 2015.

By contrast, NJ online gambling revenue shot up 32.1 percent in 2016, propelled by brands like Golden Nugget, Tropicana, and Resorts that lag behind Borgata in land-based revenues. 

Borgata’s online poker operation bore the brunt of the blow, with revenue falling 29.8 percent in 2016.

While this can be mostly attributed to the entry of PokerStars last March, the Borgata/Party network did little to help its cause.

Casino growth lags, especially of late

Borgata casino revenue did rise 16.1 percent, but that growth margin was smaller than for any other operator, sans the Tropicana. Both Golden Nugget and Caesars saw their online casino revenue soar by upwards of 35 percent in 2016.

Also worth noting, is that Borgata’s industry-leading revenue in 2016 is a bit deceiving, as the second place operator (Golden Nugget) offers online casino only, while Borgata offers both online casino and online poker.

Looking at online casino alone, Golden Nugget outperformed the Borgata by over $4.4 million in 2016. This serves in strong contrast to 2015, when Golden Nugget trailed the Borgata online casino revenue by $1.5 million.

And over the second half of 2016, Golden Nugget outpaced the totality of Borgata’s online gambling operation, bringing in $23.5 million versus the Borgata’s $22.3 million. This statistic should have raised some eyebrows over at Borgata HQ.

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Can MGM save the day?

As Borgata proved in 2014, when it held a comfortable lead over the competition, strong branding alone can vault an online gambling property toward the top of the charts.

MGM may not be as recognizable to locals as the Borgata, but it is a globally recognized casino operator, with over 20 properties in the US and abroad.

One of those properties, the newly-minted MGM National Harbor in Maryland, is within striking distance of New Jersey.

Moreover, should MGM replace Borgata’s existing loyalty program with its M Life Rewards scheme, its brand recognition will receive another notable uptick in the Garden State.

Conceivably, online patrons could earn M Life points online, for redemption at the Borgata’s brick and mortar venue — much like how Total Rewards points can be earned online at Caesars’ online casino.

Cross promotional opportunities of this magnitude don’t sprout up too often, and the revenue lift for MGM’s online casino arm could be significant.

That being said, non-local brands have had a hard time finding their place in New Jersey’s online casino market.

According to estimates by Eilers & Krejcik Gaming in its US iGaming Industry Update, only one brand not named after an Atlantic City casino — Betfair Casino — has captured more than a 20 percent share of its respective licences revenue.

How does GVC factor in?

The consensus is that Borgata online gambling partner GVC Holdings will provide the casino platform for MGM in New Jersey.

That could go one of two different ways:

  • On one hand, partypoker — which was acquired by GVC as part of its purchase of in September 2015 — hasn’t exactly been a hit with NJ gamblers.
  • On the other, GVC appears committed to NJ online gambling, and has recently taken pains to expand its casino offering.

MGM should lift Borgata back to top

Realistically, MGM wouldn’t have to do much to place the Borgata back on track.

If it grows operator revenue by 30 percent Borgata will shoot right back to the top of the revenue charts. Considering all the advantages MGM enjoys, that’s certainly a reasonable goal – especially if GVC plays along and M life integration is present at launch.

- Robert DellaFave is a game designer and avid poker player. He writes for several publications centered on legal US online poker and the regulated online gambling industries in New Jersey and Pennsylvania.
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