The Borgata is the brightest star in Atlantic City, but when things move to the Internet, that may no longer be the case as PokerStars ramps up its online gaming presence with Resorts. Image source: Borgata.
The Borgata may be the biggest bet in Atlantic City, but it may not stay on top for long, at least when it comes online betting. The March launch of Amaya's (AYA +0.00%) PokerStars online platform indicates the Borgata may soon be playing second fiddle.
High rollers
Total Atlantic City gaming revenues rose 8% in April to $215 million, thanks to the PokerStars debut, which helped boost the city's Internet gaming win 33.8% to almost $17 million. But there may also have been something of a halo effect in play as all gaming category activities were higher for the month including slot machines (up 5%) and table games (10% higher).
Where Atlantic City Internet gamblers have an advantage over their Nevada counterparts is the eastern seaboard's gambling mecca allows Internet versions of a number of casino games while its western counterpart only permits poker.
And the Borgata, which is jointly owned by Boyd Gaming (BYD 0.31%) and MGM Resorts International (MGM +1.29%), handily beat the competition across the board. Its total gaming win for April was just a few dollars under $60 million, which represented a 4.2% increase from the year-ago figure. Its bricks-and-mortar casino raked in almost $56 million, nearly double its next closest rival Harrah's, which had $29 million.
But more ominous might be the tale of the tape in Internet gaming win where Borgata, which holds the licenses for both BorgataPoker.com and PartyPoker.com, saw its take actually fall 0.2% in the month to just $3.98 million, while Resorts Casino Hotel surged into second place with its Resorts Digital division earning an Internet gaming win of $3.4 million.
Although its total casino win in April was $13.9 million, the smallest take of any of the city's eight gambling halls, it also represented a 14% year-over-year increase for Resorts, one of the best performances of the month. Expect at least the Internet win to keep growing, but it will have to prove its casino games are worth a return trip.
PokerStars debut at the casino of its land-based partner Resorts heralds a new level on Internet gaming that could launch the gambling house to the forefront of the Atlantic City stage. Image source: PokerStars.
A wide net
Online gambling in New Jersey is, of course, a relatively new phenomenon, only legalized in the state in 2013, but one that while extending a lifeline to the casino industry, which was faltering after Pennsylvania, New York, and Massachusetts all started or expanded gambling in their states, has created a labyrinthine process to gain licensing to operate.
Just ask PokerStars, which signed a deal with Resorts to allow it back in the U.S. in 2013 after being charged two years prior with bank fraud, money laundering, and illegal gambling operations. It settled with the Justice Dept. in 2012, but wasn't granted an operating license for online gambling until last October. It finally had a soft launch of its site in March and then went live soon thereafter and it's already bearing fruit.
But PokerStars can't seem to shake the cloud that follows it. Amaya CEO David Baazov was recently charged with insider trading by Canadian securities authorities.
Of course, Resorts knows a thing or two about the online gaming market as the Mohegan Tribal Gaming Authority, which manages not only Resorts' Atlantic City property but successfully operates Mohegan Sun in Connecticut and Mohegan Sun at Pocono Downs in Pennsylvania./ Resorts online offerings include ResortsCasino.com and MoheganSunCasino.com, both of which feature a wide selection of casino, slot, and table games.
Caesars Entertainment (CZR +0.00%) was another big winner in April with its interactive gaming division notching the biggest gain of the month with a 30% increase in Internet gaming win. It has been the casino's one bright spot and is why the ailing gambling house is mulling over the decision to sell the online platform for an estimated $4 billion.
Only the beginning
Online gambling has been a success in New Jersey since its introduction and bricks-and-mortar casino operators like Tropicana and Golden Nugget have performed admirably. The latter's addition of Betfair, however, has kept its Internet gaming win in the top tier in the state. The Trop has turned in a workmanlike performance as well.
Still, now that PokerStars is up and running in New Jersey, it is the one to watch, and after just one month in operation, it could be the Borgata has the most to lose.
