Editor’s note: Pennsylvania recently legalized online poker and casino games. This is the next installment in a series of articles about the casinos in Pennsylvania and their possible place in the online gambling market.
Hollywood Casino at Penn National Race Course is one of the original, premier racing venues in the commonwealth.
The track was built by the founders of Penn National Gaming, which has since become one of the country’s largest gaming entities. Located just outside Harrisburg, it opened in 1972 as the state’s first thoroughbred track and the only lighted mile-long course in the country.
Penn National still runs races every week of the year, offering both a dirt track and a seven-furlong turf course. The turf races are the richest, highlighted by the $500,000 Penn Mile Stakes.
The addition of a casino in 2008 made it feasible to host an annual, graded turf race. Table games were added in 2010, and the property has since settled into a cozy and profitable position.
While the track remains part of Pennsylvania’s history, the focus has shifted to casino operations. It’s probably just as well, as racing conditions and integrity have been the subject of repeated controversy. A years-long scandal involving horse doping, for example, is still being resolved right now.
As a matter of technicality, Gaming and Leisure Properties, a corporate wing of PNG, owns the property.
Hollywood Casino operates about 2,350 slot machines and 75 gaming tables, plus a 16-table poker room. It employs about 1,000 people.
Casino operations generated just under $250 million in revenue during the 2016-17 fiscal year. In financial terms, that makes Hollywood the eighth-largest of the state’s 12 casinos.
The Pennsylvania casino landscape is undergoing a transformation.
When the state legalized iGaming last year, casino owners began jockeying for starting positions. For some (like Sands Bethlehem), that meant unloading their assets and leaving the state amid a sellers’ market. A gaming tribe in Alabama paid $1.3 billion to purchase the property in Bethlehem, one of four casinos to change hands in recent months.
PNG appears to be reinforcing its position in the Keystone State. The group took the opportunity to acquire Pinnacle Entertainment, thereby adding a second PA property to its portfolio with Meadows Racetrack & Casino. As the process near completion, PNG has made no secrets about its plans to pursue online gambling.
“The combined company will benefit from additional promotional opportunities in online and social gaming, which will help provide an additional boost to property level performance,” said a press release.
The group already runs a social casino through its interactive division, and it’s publicly moving toward real-money iGaming, too. Given its positioning and its rumored platform provider, it seems poised to become a heavyweight in the blossoming industry.
At this point, it seems likely that PNG will partner with a third party for online gambling.
PNG has a series of land-based agreements with Scientific Games, one of the largest suppliers in the world. Although there’s nothing publicly in place in PA yet, a likely scenario would see SG running the PNG platform.
If that partnership comes to fruition, Hollywood Casino customers would have access to one of the industry’s largest libraries of online games.
As mentioned, Penn National now has a pair of properties in Pennsylvania. The Hollywood brand has become the group’s flagship, though, more familiar to the gambling public than the Meadows moniker.
Penn National’s portfolio also includes about two dozen other casinos spread throughout the country. Most notably, it owns both the Tropicana and M Resort in Las Vegas.
Evidence from those properties forms part of the expectation for a Hollywood Online Casino in PA. Both the Trop and the M are pretty strong brands on their own, but both use Hollywood as the nameplate on their social gaming products in Nevada.
Based on these inferences, Penn National seems to be well-positioned for online gambling on its home turf.
Whether intentional or a happy accident, its two PA properties are on opposite sides of the state, one near Pittsburgh and the other near Harrisburg. Being able to attack the market on two fronts should provide immediate benefits to PNG. It’s going to want to bolster its regional presence, and online gambling is complementary to that goal. Having a nationally known gaming brand may give it a leg up over some of its local competition, too.
Partnering with a giant like Scientific Games would also bode well for Hollywood’s eponymous entry into the online market.
Past installments of this series: