There are a lot of potential problems with the Pennsylvania law governing online gambling in the state, which should launch before the end of the year.
But the biggest head-scratcher continues to be a provision that bans playing online casino games inside of actual PA casinos.
That’s despite the fact that no such provision exists for PA sports betting that takes place online or via mobile devices while a bettor is on property.
As regulations have rolled out from the PA Gaming Control Board, the provision remains because it was written into the law. But that continues to be a bad policy choice from the state.
GeoComply is providing the technology for many of the coming online casinos to ring-fence individual properties. And while that’s great for that company and a testament to the accuracy of geolocation tech, it’s a needless exercise that just creates another level of unneeded complexity for online casinos.
It’s largely been a mystery why PA put the ban on online casinos in place for people betting from one of the state’s 12 casinos. Until now.
Here’s Philly.com on why the provision was added to the 2017 law:
Some insiders say the casino exclusion was not an oversight, but a small concession to the horse-racing industry, which receives about 10 percent of the revenue from casino slot machines — a $239 million share last year.
Under the new law, the Pennsylvania Race Horse Development Trust Fund will still get its piece of the slots action, but it will receive nothing from interactive gaming, including online slots.
That isn’t an iron-clad explanation, but it’s better than any that we’ve had before.
The amount of revenue that might come from actual wagering via online casinos while in a casino is likely very small, as Philly.com points out.
Still, creating a barrier for entry for an online casino industry that doesn’t even exist yet seems like a poor choice just to possibly protect some revenue for the horse racing industry.
In New Jersey, casinos commonly promote their online casinos on property with signage advertising promotions or how to sign up.
Likely, PA casinos probably aren’t going to do that. (“Hey, download our online casino app, except you can’t play on it until you leave!”)
It’s not even clear how much (or if) online casino offerings actually cannibalize revenue when played on property. We have learned from New Jersey that online casinos are additive to the bottom line of casinos and are an effective marketing tool for both retaining and attracting new customers.
So if the horse racing industry might just be hurting itself, or being protectionist for no reason.
The policy becomes even more non-sensical when you compare it to sports betting regulation in the state. PA is leaving online and mobile sports betting alone when it comes to the on-property provision.
In PA, you are likely to have online casinos and sportsbooks side-by-side and on websites and mobile apps. So casinos will have to geotarget customers when they are playing casino (slots, table games, poker), but not when they are placing a sports bet (other than to make sure they are within PA’s borders.
If that sounds silly to you, you’re certainly not alone. Again, you’re introducing more complexity — with little good reason — just to keep another segment of the state’s gaming industry complacent.
PA has shown little willingness to go back and revisit any part of its 2017 gaming expansion. But it would be wise to do so, and other states certainly should not follow PA’s lead here.