Betting big: Despite slow start, experts say online sports betting in Pa. will be huge

Stacy Wescoe//July 24, 2019

Betting big: Despite slow start, experts say online sports betting in Pa. will be huge

Stacy Wescoe//July 24, 2019

SugarHouse Casino offers a sports betting app through Rush Street Interactive (Photo submitted) –

With online sports betting just getting out of the gate in Pennsylvania, the numbers aren’t telling the story of its revenue potential quite yet, according to experts tracking the sector

And despite what may look like a slow start, people who have been studying online sports betting and watching Pennsylvania’s foray into the industry have high expectations.

One website, playpennsylvania.com, which has been tracking online gaming trends, projects that in five years the online sports betting industry will generate $500 million a year in revenue for Pennsylvania.

For now, though, Dough Harbach, spokesman for the Pennsylvania Gaming Control Board, said online sports betting has really only just begun, with the first Pennsylvania casino launching online betting in May.

Overall, the total wagering amount was $19.3 million for online sports betting in June compared to the more the $27 million wagered in-house at casinos.

The revenue amount was also very small. For that $19.3 million wagered, revenue was only about $1.4 million.

“It’s going to take some time and additional rollout for us to really gauge what all these numbers mean,” Harbach said.


Ramping up

Currently, only three of the eight casinos in the state that offer sports betting have online operations: SugarHouse in Philadelphia, Parx in Bensalem and Rivers in Pittsburgh: A fourth, Valley Forge in King of Prussia, was expected to be online by press time.

So the total amount wagered, while smaller, came from three as compared to eight casinos, and the majority came from one casino, SugarHouse, which was the only casino that was operational for all of June.

Also, revenue numbers are lower for the starting months because of promotional credits being offered by the casinos.

Parx Casino, for example, is offering a free initial $10 bet and up to $250 in credit with a deposit into a sports betting account.

Harbach said as bettors take advantage of those early offers it cuts into revenue, so some casinos might even have their spending on credits outpace revenue for the first few months.

But there are several factors that indicate numbers should skyrocket in the next few months.

First is the demand in New Jersey, which began offering online sports betting about a year ago.

“If you look at New Jersey 75 percent of wagering is now being performed through online sources,” Harbach said.

In that first year New Jersey had $1.2 billion in wagering for $204 million in revenue.

Pennsylvania has a larger population, with 12.8 million people versus 8.9 million in New Jersey.

“The fact that Pennsylvania is such a big state is part of what makes people excited,” said Jessica Welman, editor for PlayPennsylvania.com.

She noted that online sports betting in New Jersey is now so popular it eclipses in-house betting.

In June, New Jersey had $227 million in online sports bets compared to $46 million in-in house bets.

In Pennsylvania – where only eight casinos currently offering sports betting, but many more scheduled to do so – the entire amount bet on sports was $46 million for the month.

“The growth potential is huge for Pennsylvania,” she said.


Facilitated by tech

New technologies coming onto the market should also make it easier for people to make sports bets online, Welman said.

She noted that at the start of sports betting late last year in Pennsylvania, bets could be made only by physically going to a sports book inside the eight casinos that offered them.

With the start of online gambling, bettors can make wagers anywhere in the state. The sites verify that bets are being made within Pennsylvania borders using geolocating technology.

And casinos can offer mobile sports betting using the popular Apple platform.

Chicago-based Rush Street Interactive provides a mobile sports betting app to both SugarHouse and Rivers casinos.

Rush Street’s president, Richard Schwartz, said Apple has been slow to approve sports betting apps, but his company was able to get its app approved, making the company the first to offer mobile sports betting in Pennsylvania for Apple devices.

Since SugarHouse has locations in Pennsylvania and New Jersey, Schwartz said, bettors can download the apps in both states and use the app corresponding to the state where they are.

The sports betting app being developed for Valley Forge Casino by FanDuel promises to make it even easier. Its app can automatically locate the bettor and steer bets to the proper state’s sports book – New Jersey or Pennsylvania.

Schwartz said online and mobile betting may help in marketing bricks-and-mortar casinos.

Sports bettors, mostly men, tend to be about 10 years younger than the average casino patron, and some may never have visited an actual casino, he said.

“They may never have played a casino game, but this is a new attraction so it’s a point of entry for marketing, and is a great marketing tool to get people to experience the property,” Schwartz said. “They may bet online but when they want a night out on the town they come back to the property.”

Welman also noted that a big boost in betting should come later in August when football seasons starts. Football is the most popular sport for wagering in the U.S.

“That’s when I think the numbers will really explode,” she said.

Also by that time, PlayPennsylvania.com expects several more casinos will be offering betting apps, including Mount Airy Casino in Mount Pocono.

Some questions remain, such as will Pennsylvania’s online gaming growth affect New Jersey’s successful sports betting market?

Welman said that many people, especially those living in communities close to the Pennsylvania/New Jersey border, like the Lehigh Valley, may be inclined to make bets in both states now that they have an option. That could impact both states.

Pennsylvania’s tax rate on sports betting could also influence how many of the state’s 12 casinos open their own sports book.

Pennsylvania taxes sports betting at 34 percent, the highest of all states that allow sports betting. In Nevada, by comparison, the rate is 6.7 percent.

A number of casinos have yet to decide whether they will offer sports betting.

Wind Creek Casino Resort in Bethlehem, for example, does not currently have a sports book and its operators told the gaming control board at a recent hearing that they were still considering their options.