Nevada Now Considering iCasino and eSports Regulation

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Tuesday, June 7th, 2016 | Written by Stephen Smith

In 2013, Nevada became the first U.S. state to regulate online poker, but while land-based casinos are legal, online casino games continue to be illegal. That might soon change, though, as the Nevada Gaming Policy Committee recently got together in Carson City to discuss the possibility of changing gaming regulations to allow iPoker sites to begin offering casino games. At the meeting, lawmakers also discussed the potential benefits eSports legalization could bring to the Silver State, and as the meeting’s leader, Gov. Brian Sandoval, explained:

“I’ve always felt that Nevada is a state that has always embraced innovation, particularly in gaming. Because of the speed of technology and innovation, I think it’s important that our regulators keep up with the type of innovation that is happening.”

The Case for Online Casino Games

Michael Cohen of Caesars Acquisition Company was one of the experts who testified in favor of regulation, and when making his case he pointed to New Jersey as an example of the benefits of offering casino gaming alongside poker online, explaining that 84 percent of the iGaming revenues in the Garden State comes from casino games, while poker only accounts for a mere 16 percent.

Cohen also made it clear to the committee that online casino games help to support brick and mortar casinos. He stated that many casino goers in New Jersey are being inspired to come through the doors after playing online, stating that 78 percent of their new customers had never used the Caesars’ Total Rewards loyalty program before. He also shared that 41 percent of rewards program users with expired memberships chose to renew after playing at the Caesars’ online casino.

During the course of his arguments, Cohen told the committee that online casino gambling is especially appealing to millennials, a segment of the population that tends not to be interested in visiting brick and mortar casinos. Cohen said that online casino games can help to attract a much-needed younger market to brick and mortar casinos in Nevada as it has done in New Jersey.

Handling Objections

The main reason why Nevada was hesitant to legalize online casino games in the first place was security. Lawmakers worried that there would be no way to keep people outside of Nevada and people who were underage from placing bets online. During his testimony, Cohen reassured the committee, which included Nevada Governor Brian Sandoval, that the advances that have been made in geo-location and age verification technologies now make it virtually impossible for people who should not have access to online gambling sites to take to the virtual tables.

eSports Also Discussed

Also discussed at the Gaming Policy Committee was the potential of eSports (competitive video gaming) to increase the profitability of Nevada’s online gaming market. The eSports industry is expected to exceed $1.9 billion by 2018, and at the meeting Gov. Brian Sandoval signaled his willingness to move with the times, stating:

“Today, with the agenda that we have, there is a lot for me to learn. I want to be very receptive to a new generation of gamers and a new generation of e-gaming and recognize these changes.”

Of major concern for gaming operators is the fact that while visitor numbers to Nevada continue to rise each year, the growth is not reflected at the gaming tables, or even the slot machines. As a result, lawmakers are now considering ways in which to update the industry in order to appeal more to a younger demographic, with hybrid slot machines, and eSports seen as particularly important developments in helping to move the industry forward.

The Path Forward

At the end of the hearing, Sandoval instructed the committee to continue researching the benefits of online gaming and stated that another hearing would be held in October. At that time, the committee is expected to make recommendations about online gaming. Should Nevada decide to move forward with regulating online gaming, it’s likely that Treasure Island, LLC, and 888 US Limited would enter the market, as both have Nevada online gaming licenses but have yet to launch a site. While there does seem to be a real interest among lawmakers to introduce legal online gambling, industry insiders believe that Sheldon Adelson of the Las Vegas Sands will lobby against it.