Nevada Releases First Online Poker Results Since Launch

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Wednesday, April 2nd, 2014 | Written by Charles Washington

Back in April 2013, Nevada became the first US state to launch online poker and after a third casino opened its virtual tables last month, the state has now released its first batch of online poker results revealing a combined total of $8.52 million in revenue for the past ten months.

In February, Nevada’s three online poker rooms collected $824,000 in cash games and tournament rake, which represented less than 10% of the overall casino win of $926 million for the month. Worryingly, even with online poker added to the mix, Nevada’s combined gambling results were still a huge 14% lower than the $1.073 billion in revenue generated in February 2013.

Breaking down Nevada’s online poker figures

Although Nevada’s first online poker report did not provide a breakdown in revenues by operator, it is still possible to make a reasonable guess on how the revenue was distributed amongst its three operators based upon cash game traffic. According to onlinepokerreport, in February WSOP.com accounted for between 55-60% of Nevada’s revenues, followed by Ultimate Poker with between 40-45%, and Real Gaming’s traffic statistics negligible having only launched late last month.

The data also shows the total Nevada market is shrinking and in February hit its lowest point in over six months, with an average of just 160 cash game players over a seven day period. From that figure, market leader WSOP Nevada had around 95 cash game players at any one time, representing a 25% decline over the past 30 days, while Ultimate Poker Nevada had an average of around 65 players, down 10% over the same period.

In comparison, between May and September 2013 when Ultimate Poker was the only internet poker site operating in the state, the venue enjoyed between 180 and 220 cash game players at any one time.

Signalling further troubles ahead a number of other poker sites, such as PartyPoker and Ace Play Poker, are preparing to launch their own operations over the coming months, threatening to dilute further the already overcrowded market.

Regulated markets comparison

In terms of both the percentage of players per population and revenue generated per capita in state, Nevada fared well compared to the other regulated markets of New Jersey and Delaware. In fact, Nevada’s average traffic of 65 players per million residents is in line with other global regulated markets where traffic averages between 55-67 players per million.

Nevada’s statistics are even more favourable when one considers it offers poker only, unlike the other two US states which also offer casino games. In addition, New Jersey is bound to attract a greater number of cross-border visitors compared to both Nevada and Delaware.

After almost a year of online poker, Nevada’s tally of $8.5 million in revenue was less than the $10.3 million New Jersey generated in February alone, and would suggest Nevada’s market is but one tenth the size of its competitor. Meanwhile, Delaware market is less than a tenth the size of Nevada’s and in February generated $73,971 in online gambling revenues, a 16% decline for the state month-on-month.

On the bright side

On a more optimistic note, a recent online poker compact signed between Nevada and Delaware may launch as soon as this summer and could give both states’ online gambling markets a much needed boost. Although this may not translate immediately into much higher revenues, the whole process promises to draw other undecided states sitting on the fence into joining the online gambling bandwagon.

According to a recent report, almost a dozen US states are considering online gambling regulation this year, including California, Colorado, Hawaii, Illinois, Iowa, Louisiana, Massachusetts, Mississippi, and Pennsylvania. The Delaware-Nevada online poker compact may then help entice some of these other states to share their liquidity in order to ensure a more competitive and viable industry.

Also, making their transition smoother, Nevada has offered to give them the benefit of its online poker experience, with Nevada Governor Brian Sandoval, explaining:

“If there are states that don’t have as sophisticated a regulatory structure as we have, that’s something we can offer. If your state doesn’t have the infrastructure, use our capabilities.”

Another bright light on the horizon is the upcoming 45th annual World Series of Poker which will take place in Las Vegas from May to July. Every year the organization’s live poker tournaments draws thousands of players from all around the world and last year its showcase $10,000 Main Event attracted 6,352 players alone. Needless to say, online traffic will almost certainly receive a significant boost during the summer months.