The strongest brand in the NJ online gambling space is about to get even stronger.
This deal virtually ensures that the already dominant Golden Nugget will see its reign at the top continue into 2019, and likely beyond.
License check, platform check
In order to conduct business in the New Jersey online gambling market, a company has to latch on with a licensed Atlantic City casino. Already, Golden Nugget AC plays host to three online casino sites, the self-branded Golden Nugget Casino, Betfair Casino, and Play SugarHouse. Churchill Downs will presumably become the fourth entity to win an operating license, enabling it to set up shop in New Jersey.
Churchill Downs plans to offer both sports betting and online casino games via the Golden Nugget license, becoming the first in NJ to forge a partnership that covers both verticals. On Monday, the US Supreme Court declared the federal ban on sports betting (PASPA) unconstitutional, paving the way for legal sports betting in all US states. New Jersey, which has been embroiled in a fight to offer sports betting dating back to 2011, will be at the forefront of the industry, likely taking its first bets this summer.
Churchill Downs will offer iGaming and sports betting services through the SBTech platform. According to the press release, SBTech will provide the front end website and mobile apps, as well as the back end systems. This comes as a mild shock, as Churchill Downs already has extensive experience operating in the iGaming space, via its TwinSpires.com website, which has provided online horse racing wagering services dating back to 2007.
The company will presumably be taking advantage of its partnership with SBTech in Pennsylvania as well, as it recently forged a deal to acquire racino Presque Downs. Churchill Downs also owns two brick & mortar casino in Mississippi, and has recently acquired a third (Lady Luck Casino Vicksburg). Both Pennsylvania and Mississippi have sports betting laws on the books.
About the deal, Churchill Downs Inc. CEO Bill Carstanjen had this to say:
We are confident that our strategic partnership with SBTech provides us with an industry leading platform to offer innovative and exciting, integrated iGaming and sports betting products. We have the unique opportunity to leverage our knowledge and experience operating the largest legal online horse racing wagering business in the U.S. as we enter the iGaming and sports betting markets.
And then there were three, three more that is
2018 could see the addition of three online casino sites in the NJ market. Under normal circumstances it’d be safe to assume that launching several new sites into a nearly five years old market would be a recipe for disaster, but New Jersey is no ordinary market.
- It’s been proven that sites launched as late as 2016 can still thrive, Play SugarHouse being the quintessential example.
- The New Jersey iGaming market set a revenue record in March, and posted its second best numbers in April.
- A robust promotional and bonus schedule incentivizes players to spread the wealth across multiple sites.
Furthermore, the new entries to the market will each be able to offer something either compelling or unique.
Hard Rock Casino is partnered with Gaming Innovation Group. Although a newcomer to New Jersey, GiG has a strong presence in international markets, offering innovations previously unseen in the US. Coupled with Hard Rock’s strong desire to establish itself on the online front, there’s good reason to believe the duo will make waves in New Jersey.
Ocean Resort Casino is partnered with GAN, which supplies the platform for one of the leading sites in New Jersey: Betfair Casino. Although Ocean doesn’t possess nearly the same name recognition as Hard Rock, it’s still an Atlantic City brand. This is important because on balance, AC branded online casinos vastly outperform those carrying the name of an outside party.
Then there’s Churchill Downs. While not an AC brand, it’s the second best thing: a well known land-based casino and horse racing venue owner/operator with a presence in multiple states. It’s also one of the few companies in the US with a vast online presence, via Twin Spires.
In addition, Churchill Downs will be uniquely positioned to cross-promote its sports betting and casino products, driving traffic across verticals. Undoubtedly, more of New Jersey’s online casino operators will be able to do the same, but Churchill Downs may be among the first. Not to mention, its iGaming partner Golden Nugget holds a more than one-third market share in New Jersey.
SB Tech currently offers 1,500+ casino, live dealer, and virtual sports games as part of its product, with partnerships spanning a slew of top-flight providers, including NetEnt.
When will we see these new sites?
Both Hard Rock Casino and Ocean Resort Casino are slated to debut their land-based casinos on June 28. It wouldn’t be too presumptuous to assume that the online sites will launch shortly after.
The timeline for a Churchill Downs online casino and sports book launch are a big sketchier, as there are some regulatory hurdles to leap. A solid estimate points to a late 2018 launch for the online casino, with a sports book to follow shortly thereafter.