Betfair To Maintain NJ iGaming Operation Despite Trump Plaza Closing

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Tuesday, September 9th, 2014 | Written by Stephen Smith

Despite the Trump Plaza’s imminent closure on September 16th, its online partner Betfair will be allowed to continue running its online poker and casino operations at least until the brick-and-mortar finally surrenders its casino license. That is expected to give the UK-based online gambling company enough time to make other arrangements, and as David Rebuck, director of the state Division of Gaming Enforcement, explains:

“The division will consider input from all involved parties to ensure a smooth transition as Trump Plaza winds down its operations and as Betfair continues its iGaming operations in the state..They want to remain fully functional and stay in New Jersey, and we will work with them to do that.”

Trump Plaza closure

In 1984, the Trump Plaza Casino opened at a cost of $210 million, but since its inception has consistently placed near the bottom of Atlantic City’s casinos. In 2013, for instance, the gambling venue generated just $73 million in revenues and its owner, Trump Entertainment Resorts, even failed to sell off the casino to a potential buyer for a mere $20 million.

Last year, Trump Plaza also partnered with Betfair to eventually launch Betfaircasino.com in New Jersey, and whilst its poker offering has generated just $48 so far this year, the site’s casino games have returned $4.3 million already for the first seven months of 2014. Nevertheless, Betfair and Trump Plaza still continue to tie for bottom place in NJ’s iGaming market alongside the Taj Mahal/Ultimate Gaming partnership, with their revenues through to July paling in comparison to online market leader Borgata ($27.1m), and Caesars Interactive ($21.2m).

Plaza could find a buyer

Although there exists a chance Trump Plaza Casino could still find a buyer before it closes next week, the chances of that happening would appear slim, especially as its owners have unsuccessfully been seeking to find an interested party since 2011. Furthermore, the Atlantic Club Casino which shut in January also failed too attract interest, while two other Atlantic City casinos, the Showboat Casino and the $2.4 billion Revel casino, have also been forced to declare their imminent closures.

Betfair to Partner with Trump Taj Mahal

Fortunately for Betfair its partnership arrangement is with Trump Entertainment Resorts which also runs the Trump Taj Mahal in Atlantic City, rather than solely the Trump Plaza Casino, and so their relationship will continue even after the Plaza’s closure. Conveniently, Betfair’s platform and servers are already housed at the Trump Taj Mahal thus allowing for little disruption to its online service, whilst the Taj’s partnership with Ultimate Gaming will also present no problem, as New Jersey permits a brick-and-mortar casino to run as many as five different iGaming platforms at any one time.

Problems from the start

From the very beginning, the online partnership between Betfair and Trump Plaza failed to garner the interest of other platforms because the gambling venue was not allowed to use the Trump brand name to market its online product. This meant it was unable to leverage the loyalty of its land-based customers, just like Caesars and the Borgata have successfully managed to do, and recently Donald Trump has even filed a lawsuit against Trump Entertainment Resorts to have his name removed from the Trump Plaza and Trump Taj Mahal.

As his lawsuit, filed in the name of Trump AC Casino Marks LLC, explains: “Since Mr. Trump left Atlantic City many years ago, the license entities have allowed the casino properties to fall into an utter state of disrepair and have otherwise failed to operate and manage the casino properties in accordance with the high standards of quality and luxury required under the license agreement. The Trump name..has become synonymous with the highest levels of quality, luxury, prestige and success.”

NJ iGaming market

By the end of 2013, New Jersey casino revenues had halved from their peak of $5.2 billion in 2007, and the continuing contraction in the Garden State’s gambling market is expected to cost 7,000 casino staff their jobs by the end of the year.

When the state launched its first online gambling site in November 2013, it was hoped the nascent industry would help boost the gambling resort’s beleaguered fortunes, but up to date revenues have also come in considerably below initial expectations.

Nevertheless, New Jersey still represents the USA’s biggest iGaming market with its population of 8.865 million eclipsing that of Nevada (2.76m), and Delaware (917k). The huge difference in population is directly reflected in the monthly revenue results coming from these regulated markets, with New Jersey’s tally of $9.51 million in July, far above that of Nevada ($985k) and Delaware ($175k).