Following on from the Covid-19 pandemic, commercial gaming revenue achieved over $60 billion for the first time ever but questions have arisen about the ethics of gambling’s recent advertising bombardment
Key takeaways
- Bettors still prefer spending their money the good old-fashioned way by visiting a casino in person
- Slot machines equate for over half of the total revenue
- 34 percent of the adult population visited a casino in 2022
For the first time ever, commercial gaming in the United States topped $60 billion in revenue last year according to figures released last week by the American Gaming Association (AGA). The $60.4 billion won by casinos last year was up nearly 14% over 2021 levels.
Following on the Covid-19 pandemic that kept casino doors closed for the better part of two years, it may come as a surprise to some to discover that in-person gambling remains the nation’s favorite within the industry, accounting for more than 80% of its revenue, with online betting providing nearly a fifth of the revenue.
Slot machines were far and away the biggest money-maker, raking in over half of the total revenue—$34.2 billion, a 5.1% increase from 2021. Table games came second with $10 billion in revenue—a 13.9% rise from 2021—but sports betting is closing in quickly on the traditional casino plays. Sports betting generated $7.5 billion in revenue during 2022—a whopping 72.7% increase from a year earlier—after gamblers wagered a combined $93.2 billion on sporting events throughout the year.
The figures do not include tribal casinos, which report their revenue separately and the AGA has credited the revenue rise to Americans turning away from illegal gambling, even though it recently estimated wagers of more than $500 billion a year still run through illegal gambling operations, resulting in $44 billion in lost revenue for casinos and $13.3 billion in tax losses for states.
The association said 84 million American adults, or 34% of the adult population, visited a casino in the past year, including newly opened markets in Nebraska and Virginia.
Sports betting continued to grow rapidly in 2022, setting new records for the total amount wagered ($93.2 billion) and sportsbook revenue ($7.5 billion). This growth was helped in part by Kansas, which began retail and mobile sports wagering, and by the launch of mobile sports betting in Louisiana, Maryland, and New York. Online casino revenue grew by 35.2% to $5 billion.
The Las Vegas strip and Atlantic City remained among the top gambling markets in the country in 2022, with the Baltimore-Washington, D.C., Chicago, and Mississippi Gulf coast markets also performing well.
The announcement came after an estimated $16 billion was bet on Super Bowl LVII – a sports betting record for a single event. Some 100 million sports betting transactions were made during the weekend, according to a CNBC analysis.
The most monumental change in recent years came in May 2018, when the Supreme Court in a 6-3 decision struck down a 1992 law that largely restricted sports betting to Las Vegas. The decision set off a wave of legalization efforts, allowing for legal sports betting in 33 states and the District of Columbia in time for the Super Bowl.
The moves have not come without serious detractors though, who have raised concerns that the rapid spread of legalized gambling could lead to addiction problems, especially among financially vulnerable people, while legalized sports betting increases the risk of match-fixing.
It’s not very often that sports betting stakeholders universally find themselves all-in on the same issue, but that’s the case a week after U.S. Rep. Paul Tonko of New York filed a bill he calls the Betting on Our Future Act.
The legislation would prohibit any sports betting advertising and marketing on television, radio, and the internet and it has galvanized stakeholders focused on one thing: keeping the federal government out of their business.
Since May 2018, states have legalized in myriad ways. Some allow only in-person wagering, while others authorize only digital or approve of both. Some allow betting on tribal lands only. Some give professional sports venues a chance to have sportsbooks. Some have banned wagering on college sports. And some have 51% tax rates while others have 6.75%.
Whatever it looks like, each state has its own culture and set of priorities, all of which make a one-size-fits-all solution for even just one piece of the pie tough to swallow in the form of Tonko’s bill.
A ban on all advertising would eliminate that opportunity to reach consumers, which industry spokesmen argue would push consumers to the black market that a legal framework is designed to protect them from.
