Caesar's Admits that Online Gambling may Hurt Land Based Casinos

The argument that regulated online gaming could hurt land based casinos has been around since regulation talks began a few years ago, and now the largest casino company in the world Caesar’s, has sent a message out to investors that this could very well be the case. Of the 3 states that have legalized online gambling so far, New Jersey is by far the largest and Caesar’s has a huge presence, owning 4 of the 12 land based casinos there, and is showing some concern that its online venture could lead to less visitors through the doors of its Atlantic City establishments. Caesar’s wrote a report to the US Securities and Exchange and stated that, "Caesar's will, and other online providers do, offer online gaming options that compete with our live poker offerings in Nevada and New Jersey, expansion of online gaming in Nevada, the commencement and expansion of online gaming in New Jersey and the introduction of online gaming in other jurisdictions may further compete with our operations. Online gaming may reduce customer visitation and spend in our traditional casinos in Nevada and New Jersey, which could have an adverse impact on our business and result of operations." That’s about as clear as you can make it.

Residents of New Jersey may now play casino games online, and many of those games are the exact same games that may be played in land based casinos. Caesar’s have actually played down the report a little saying that for legal reasons it simply has to be included in the report, and it is one of many issues that they must by law, inform investors of. New Jersey casinos have suffered in the last few years with a decrease in profits and less visitors in general and the ongoing effects of the recession are being blamed for this. It was hoped that online gambling would increase casino revenue and it may still in fact do that, but whether or not it will be at the expense of the land based establishments only time will tell.