Sports gambling has spread out enormously since 2018, when a U.S. Supreme Court decision opened the floodgates for legalization. But the advance of iGaming, such as online casino Michigan options, has been far slower nationwide.
Yet, online casino also known as iCasino, has seen consistently surging revenue. That segment of the market hit $5 billion in gross gaming revenue in 2022, though it’s only legal in six states.
That was just part of a message on the state of the gaming industry that American Gaming Association president and CEO Bill Miller delivered Wednesday. Miller detailed the successes and challenges of the industry, which enjoyed more than $60.4 billion in revenues (retail and online combined) at commercial casinos last year.
The fastest growing segment of the industry was sports gambling, at least in 2022. Michigan sports betting accounted for more than $253 million in adjusted gaming revenue last year.
Michigan Online Casino Revenues Hit $1.58B
Yet iGaming, with a far more modest public profile, continues to perform exceptionally well. One strong example was mobile Michigan casino apps, where revenues hit $1.58 billion last year. That was 42% higher than 2021 ($1.11 billion).
To put that in perspective, the statewide online iGaming revenues were about 25% more than the total revenues from Detroit’s three bricks-and-mortar casinos, which was almost $1.26 billion. Not included in traditional casino figures are revenues from the state’s Native American casinos.
As of January, 36 states plus the District of Columbia have legalized some form of sports wagering, whether online, retail or both. But only six states have legalized iGaming, which typically consists of casino games, such as MI real money slots and house-banked table games (blackjack, roulette and others) plus peer-to-peer poker.
Only Six States Have Online Casino
The six iGaming states are Michigan, New Jersey, Pennsylvania, West Virginia, Delaware, and Connecticut. Nevada only has internet poker. Several states have introduced iGaming legislation in 2023 and it remains to be seen how those efforts fare.
Despite the disparity in the sheer number of jurisdictions with sports betting compared with iGaming, internet casino revenue doesn’t trail far behind.
Sports gambling, which was available in more than 30 jurisdictions in 2022, had a nice revenue jump of 72.9% percent year-over-year to $7.5 billion. That was largely fueled by New York getting into the online sports betting arena along with a handful of states either freshly adopting or expanding sports gambling, including Louisiana, Kansas and Maryland.
Meanwhile, iGaming, stuck in a static landscape, still posted a little more than $5 billion in revenue. That was a collective 35.2% jump in revenue from 2021 — again, that came without any new states launching iGaming in 2022. The most recent state to begin online casino was Connecticut, in October 2021.
New iGaming Record For Q4 of 2022
At year’s end, national iGaming set a new quarterly record of $1.39 billion, up 28.2% from the fourth quarter 2021, and each of the five iGaming markets that were fully operational for 2021 set new annual records in 2022.
In Michigan, taxpayers were a beneficiary of the popularity of iGaming, according to the Michigan Gaming Control Board. The 2022 total iGaming state tax was $289 million, up 43.4% over 2021 ($201.7 million). For the three Detroit casinos, the total adjusted gross receipts were $1.26 billion in 2022, down 0.8% from 2021 ($1.27 billion). Taxes dipped by the same percentage to $101.8 million.
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More Numbers From AGA Report
In his recap of the gaming industry in 2022, Miller also noted the following:
- Casino visitation: About 84 million American adults — that’s 34% of the U.S. adult population — visited a casino in 2022.
- Gambling behavior: Table game revenue, which had been depressed by social distancing restrictions brought about by the COVID-19 pandemic, was up 13.9% year-over-year from 2021. Slot machines showed a 5.1% increase.
- Sports Betting: The handle for legal sports betting in 2022 was more than $93 billion, with gross revenue of about $7.5 billion. This is dominated by the online market, including Michigan sportsbook apps.
- Top markets: The Las Vegas Strip is still the king of casino markets with Atlantic City No. 2. The next three are Baltimore-Washington D.C., Chicagoland and the Mississippi Gulf Coast.
- Demographic shift: Constantly worried about its customer base becoming older, the casino industry saw a change. The average age of adult Americans visiting casinos has decreased since the start of the pandemic. The average age of a casino patron was 42.4 years old in 2022, down from 43.6 in 2021 and 49.6 in 2019.
- Big challenge: Offshore internet casino operators eat into sports gambling and iGaming action. Within America, illegal and gray-area gambling machines in stores, bars and clubs remain a problem. The gaming industry continues to seek help from federal and local law enforcement to clamp down on both.
