There are 7 states where online poker is legal in the US and the 8th state is on the way (by March 2022). If you want to start an online poker business in this country, you should learn the difference in the conditions for licensing and regulating an iGaming business. Let’s review and compare.
We will talk about:
- The overall online poker market and perspectives in the US
- Tri-state agreement
- Details of licensing and revenue growth in the states allowing poker
and will summarize the data in a handy table.
Online Poker in the US in General
There was the world’s largest iGaming market in the US until the Black Friday happened in 2011. Now we see the restoration. It’s a hard way but the online poker market is gradually recovering.
The iGaming market is strongly regulated in the whole country. The laws are very strict. At this moment, online poker is legal in Nevada, New Jersey, Delaware, Pennsylvania, West Virginia and Connecticut. First of all, there is much in common in the conditions.
In every state, you should get a license. The regulators demand literally tons of documentation on business owners, partners, financial and structural information, a strong business plan etc.
Apart from the regulation obstacles, the situation is hopeful. During the lockdown, many players forcibly tried online poker and enjoyed it. According to Scientific Games, Jogo Global and other platform providers in the US, a great number of land-based players are now eager to use the online services. So today the omni-channel is a topic of high interest for operators.
According to Optimove’s iGaming Pulse report, the average monthly deposit in sports betting and online casinos is growing. The US is up 9% year-on-year in January 2022.
The indicator includes online poker in the US. Taking into account the similarity of audiences it indirectly suggests that the online poker market has a big potential. People are eager to pay more.
In each state, operators must check the geolocation and prevent the access of players out of their license validity. Poker players must physically be inside the state lines to register, log in and play.
The restriction in geolocation caused the small market size in each state. To overcome this obstacle, three states signed an agreement to create the interstate player pool. Now players from Nevada, New Jersey and Delaware can play with each other. The agreement stimulated market growth.
$500k for 2 years, then $250k annually
- REAL GAMING (South Point Poker LLC)
- WSOP – World Series of Poker (Caesars Interactive Entertainment, Inc.)
NB. Media reports that GVC and Roar Digital also got the license but there is no such information on the Nevada Gaming Control Board official website.
Nevada is a state with a rich history of gambling and it was the first state to legalize online poker. Nevertheless, there is only one live site offering the game. The regulator is very strict and it is very hard to get the costly license.
Unfortunately, there is no information about commercial success because there is only one active operator and the regulator can’t publish the information about the revenue of the particular company.
But there is indirect evidence of the progress – during the pandemic the online casinos traffic rapidly increased. According to EGR North America, mobile sportsbetting revenue in Nevada was $117m in 2020 and $194m in 2021. Most notably, the growth of mobile is 20% faster then all sportsbetting in Nevada as a whole. People realized that online gambling is safe, it is easy to join a game and find competitors. So the easing of restrictions didn’t reduce the traffic much.
The state has a big population and many gambling fans visit it. Plus Nevada participates in the interstate poker player pool. So the market seems to be promising, but it’s hard to enter it.
$300k — first year
$150k — annually
$250k annually to a responsible internet gaming fund
15% on gross revenue + 2.5% for Investment Tax Obligators
- Borgata Hotel Casino & Spa
- Caesars Interactive Entertainment for Boardwalk Regency LLC
- Golden Nugget Atlantic City
- Hard Rock Hotel & Casino
- Ocean Resort Casino
- Resorts Casino Hotel Atlantic City
- Tropicana Casino Resort Atlantic City
It’s a great deal to enter the New Jersey online poker market because operators should partner with a local casino. The servers must be physically located inside the state lines. Even so, there are a dozen poker sites and practically all major poker brands are already here.
The population is quite big and New Your City is near. Also, New Jersey shares the interstate pool. So the operators have enough players.
Online poker revenue in 2021 was $29.9m and the share of poker in the online casino business was 1.75%. By comparison, the poker revenue in 2020 was $38.8m and 20.9m in 2019. So we see an expected decline after the explosive growth with the background of the lockdown in 2020. But the trends are still positive in the long term: almost 50% of revenue growth compared to pre-pandemic 2019.
The market is quite mature now but it is growing and has huge potential.
$50k — annually
- Delaware Park and Casino
- Dover Downs Hotel and Casino
- Harrington Raceway & Casino
During 2014-2016 the market was decreasing until a tri-state online poker liquidity agreement was signed and Delaware operators were allowed to share players with Nevada and New Jersey.
It was one of the first states to legalize online poker. But the market is still not saturated. Only three casinos have licenses and they share the same platform — 888poker.
The difficulty is caused by the small population and the features of local laws. All earned money from each operator goes to the state until the amount reaches $3.75m.
There is no separate data on online poker. Total iGaming revenue in 2021 was $9.5m. Not much but there is a positive trend. The iGaming revenue was $8,5m in 2020 and $3,6m in 2019.
Launching an online poker business in Delaware could be quite challenging. It is difficult to enter and you need to invest a lot and get a lot of patience.
For Interactive Gaming Operator — $1m for 5 years. Renewal — $250k.
14% state tax + 2% local tax
- Betfair Interactive US LLC DBA
- BetMGM, LLC DBA
- Crown PA Gaming, Inc. DBA
- Digital Gaming Corporation USA
- PointsBet Pennsylvania LLC
- Rush Street Interactive PA, LLC
- TSG Interactive US Services Limited
- Unibet Interactive, Inc.
It’s not easy to get the license. All games and products must be certified as fair and safe by independent testing agencies.
Only four sites have launched at the moment and four operators are now pending license approval.
There is a big population and the market is quite successful. Total poker revenue in 2021 was $29.4m. It was about $36m in 2020. Now we see a slight decline because players partly returned offline after lifting the restrictions. But there is still great growth in the long term – the revenue of 2019 was $4m.
There is a promising market and probably its potential will be increased soon. The state probably will join the interstate player pool. There is an opinion that Pennsylvania is the best state for beginners to start an iGaming business.
$250k and then $100k every 5 years
It’s a small state but it borders 5 states, where lots of poker fans live.
Online poker was legalized in West Virginia in 2019 but no sites are offering the game yet.
There are only five gambling organizations that have the right to start the online poker business. So the state offers only five licenses to buy. However, at this moment, not a single operator got the license because of unclear rules and small market size.
At this moment there is a discussion on an interpretation of the Wire Act in federal law. Joining the interstate agreement depends on the result of this discussion.
The state seems to have a potential for iGaming business but there is still a lot of uncertainty.
Application fee — $50k
Get the license after approval — $100k
$50k — annually
Depends on the revenue: 20-28%
- MGM Grand Detroit
- PokerStars Michigan (in partnership with Odawa Casino Resort)
It is one of the latest states to legalize online poker. Now there are only two sites offering poker.
There is quite a big population. In 2020, the law allowed interstate player pools. But poker platforms haven’t joined it yet.
Update May 23, 2022: Michigan joined the interstate player pool.
There is no information on operators’ revenue. But the feedback from players is quite positive and hopeful.
It’s a new growing market. It seems to be promising to start an iGaming project here.
18% for online casino gaming until 2026 when it will increase to 20%
Only two operators were allowed: Mashantucket Pequots and Mohegans. They work with FanDuel and DraftKings respectively.
Online poker became legal in March 2021. It is the latest state that legalized online poker and nothing was launched yet.
Restrictions in legislation prevent joining the multi-state pool. Still, there are chances that it will change soon.
The market is too young and totally closed for any extra operator.
At the beginning of February 2022, the bill of gambling games legislation was introduced by the House Committee on State Government.
The license fee will cost $45k, then $10k annually. Also, joining the interstate agreement is expected.
The State Government Committee is yet to consider the bill.
|$500k for 2 years, then $250k annually
|South Point Poker LLC
Caesars Interactive Entertainment, Inc.
|$300k — first year
$150k — annually
|Borgata Hotel Casino & Spa
Caesars Interactive Entertainment for Boardwalk Regency LLC
Golden Nugget Atlantic City
Hard Rock Hotel & Casino
Ocean Resort Casino
Resorts Casino Hotel Atlantic City
Tropicana Casino Resort Atlantic City
|$50k — annually
|Delaware Park and Casino
Dover Downs Hotel and Casino
Harrington Raceway & Casino
|$3,6m (total iGaming)
|$8,5m (total iGaming)
|$9.5m (total iGaming)
|$1m for 5 years. Renewal — $250k.
|Betfair Interactive US LLC DBA
BetMGM, LLC DBA
Crown PA Gaming, Inc. DBA
Digital Gaming Corporation USA
PointsBet Pennsylvania LLC
Rush Street Interactive PA, LLC
TSG Interactive US Services Limited
Unibet Interactive, Inc.
|$250k and then $100k every 5 years
|Application fee — $50k
Get the license after approval — $100k
$50k — annually
|MGM Grand Detroit
PokerStars Michigan (in partnership with Odawa Casino Resort)
|18% (20% after 2026)
Conclusion on Online Poker in the US
It is not easy to launch an online poker project in the US today. But the demand and the commercial success of the pioneers says that it is worth trying. Also, the regulation is trending to become more and more friendly to operators.
There is a dilemma. You can start your project now dealing with the regulation rigor. Or you may wait for easing dealing with the risk of facing a totally occupied niche of online poker in the US.