Summer Slump Continues for New Jersey Online Gambling Industry

The New Jersey online gambling industry has been struggling to maintain revenue growth in recent months. The Division of Gaming Enforcement recently announced that online gambling revenues fell nearly 12.5% between April and May. The decline was even sharper after considering that May had an extra day. May was the second month in a row that revenues declined.

The trend is disappointing to the state's gaming providers, but most of them expected online gambling revenues to decline in the summer. Research showed that warmer weather caused online gambling revenues to decline for companies that provided online gambling before the Unlawful Internet Gambling Enforcement Act was passed. The state's regulated gaming providers expected that the trend would continue. Many of them actually expected revenues to decline even more significantly.

The drop in online gambling revenue was bad news, but there are signs that revenue will pick up in the fall. The DGE stated that the number of online gaming accounts grew by nearly 9% in May. Over a third of a million accounts have been created since online gambling was launched in November. Many citizens that have created accounts haven't used them yet, but probably intend to do so in the future. Therefore, many online gaming providers view new accounts as a leading indicator of future online gambling revenues.

Online gambling providers are optimistic that activity will pick up in the next few months. However, some online gambling providers may face long-term problems. Ultimate Poker is starting to lose market share in New Jersey and has already lost its lead in Nevada. Some gaming operators may need to make drastic changes to remain competitive.