States told they need realistic projections for igaming

Data analyst Eilers Research has warned US states planning to legalise igaming to keep their financial projections realistic. In its latest report called ‘US iGaming Outlook for 2015 and Beyond’, Eliers pointed out that New Jersey Governor Chris Christie’s team had estimated around $180m in tax for the first year of operation, when in reality the tax revenues from opening the market were a tenth of that figure.

In fairness, most other analysts over-estimated the figure as well, including Eilers, but not to the extent of Christie’s Treasury Department.

The report said: “We are often asked why regulated iGaming in the US has been such a disappointment to date and do we expect things to change in the future? The short answer is revenue expectations were unrealistic, new forms of online entertainment have emerged as a viable alternative, the state-by-state rollout is inherently flawed and, no, we do not expect things to improve in any meaningful way.

“In fact, we would urge states considering adopting iGaming legislation to keep financial projections & expectations realistic as to avoid disappointment.”

The report predicts that New Jersey online gaming revenues will increase by about 10% in 2015, although this assumes the entrance of PokerStars and the exclusion of sports betting.