Since PASPA was repealed in 2018, there has been a steady stream of US states making steps to bring forth betting legislation that would allow their residents to enjoy the growth of iGaming. At the time of writing, 36 states have passed some form of law permitting betting to take place in their location, with more expected to add themselves to that list both this year and in years to come. Presently, the biggest market for iGaming is in New York, where online sports betting became legal at the beginning of 2022. Its smaller neighboring state, New Jersey, is also a reliable market for betting companies and unlike the Empire State, it also permits casino betting. One of the main facets we’ve seen from the legalization of online gambling is the range of different forms it has taken. There are sweepstakes games, movie tie-in slots, and even the chance to bet on some slightly more whacky events such as the WWE or cheese rolling (a rather odd UK tradition).
Of the other states in the union, there are many that have had better or worse outcomes with their own legislation, but in general betting has been successful in attracting a considerable financial income. By virtue of ring-fencing a large percentage of turnover for social programs, the states have been able to offer iGaming to their residents while assuaging a lot of the fears other residents have had about its potential to cause social problems. And two of the states that have seen particularly impressive results have been Michigan and Pennsylvania – both of which posted revenue from iGaming in the billions in 2022.
What makes these states big hitters in iGaming?
In the cases of Pennsylvania and Michigan online casinos and sports betting, the conditions for making iGaming a success are certainly cause for optimism. To see a big intake, a state should ideally have a few factors in place. A high population, and in particular a large urban population, is considered to be a benefit. Pennsylvania is home to both Philadelphia and Pittsburgh, two highly populous cities, among others. Michigan, meanwhile, houses Detroit and Lansing along with the college city of Ann Arbor. A second factor is the presence of major sports teams. This is an area in which both states hit it out of the proverbial park.
Pennsylvania has NFL teams in Philadelphia (Eagles) and Pittsburgh (Steelers). It is also a two-team state in the NHL (the Flyers and Penguins) and MLB (Phillies and Pirates), and has an NBA team in Philadelphia’s 76ers, known for producing some of the greatest point guards of all time such as Allen Iverson. There is also an MLS team, the Union. Detroit is the center of pro sports in Michigan, with the Lions, Red Wings, Tigers and Pistons respectively. With populations of 13 million and 9 million, many of whom are fanatical supporters of the local sports teams, Pennsylvania and Michigan are born to be big sports betting markets.
But lots of states have big populations and sports teams, so what else is there?
Pennsylvania and Michigan may be among the majority in having permitted sports betting, but they are very much in the minority in one key area. They are two of only six states to have also legislated to allow mobile casino gambling, which augments the take in each state. People who start out betting on sports are more predisposed to betting on casino games than those who haven’t bet before, and vice versa.
The results of this have been made clear by the calculated revenues from iGaming in each state. In 2022, Pennsylvania recorded revenue of $5.21 billion all-in, while Michigan – a smaller, less wealthy state – still managed close to $2 billion. While there are limited figures on what percentage of income came from which type of betting, it’s understood to be around 60-40 in favor of sports betting.
As betting becomes legal in more states, and has been legal in some for close to five years, it is expected that it will become less taboo and more of a part of life, and as this happens it is to be assumed that those states with the expertise and institutional knowledge will enjoy the greatest benefits. That could well mean that the impressive results we have seen so far from these two potential titans might be merely the tip of the iceberg, especially with Philadelphia having a team in the Super Bowl in 2023.
