2014 a ‘pivotal year’ for Atlantic City casinos

Entering the fourth year of a five-year marketing plan to revive Atlantic City’s fledgling casino industry couldn’t have got off to a worse start with the closure of Atlantic Club Casino. The odds are now pinned on internet gambling to refuel the casino town, which could become the hub of online gaming nationwide.

As Governor Chris Christie stated on New Year’s Day, “It is a very pivotal year [for AC casinos], but it is a year where we have to show some significant results.” Since assuming office in 2010, the boisterous governor has vowed to shake up gaming and tourism. He set a five-year grace period for casinos to start showing improved profits, or would consider expanding gaming to others parts of the state.

“It’s absolutely a pivotal year because we need to make continued progress in Atlantic City, or we’re going to need to start considering alternatives,” reinforced Christie, who said that he will continue the marketing plan with Atlantic City’s new mayor, Don Guardian, but if no progress is made by the fifth year, legislation could be introduced to allow casinos at the Meadowlands and elsewhere.

Several legislative attempts have been made to drive investment over the past few years, such as reducing stringent gaming laws and allowing mobile betting at resorts. But revenues continue to be strangled by out-of-state competition, specifically along New Jersey borders. The governor even pumped $260m of tax rebates to help Revel Casino-Hotel launch, but the facility proved disastrous and filed for bankruptcy less than a year after opening. Nothing seemed to be working. That was, however, until intrastate online gaming was legalised.

When New Jersey became the first US state to permit fully-fledged online casino gaming on 26th November, eyes refocused on what was once the gambling capital of the east coast. Importantly, bricks and mortar casinos were given exclusivity to operate online casinos. Sanguinity finally arrived at the end of November when Atlantic City casinos saw the first back-to-back monthly revenue increase in more than seven years. Gaming revenue at Revel caused a stir too, shooting up 133 percent.

The big question now is whether online gaming will reinstate Atlantic City to its former glory, or simply divert customers away from spending at land-based casinos. Almost 125,000 online accounts had been created in New Jersey at the start of the year, but the first month’s results are yet to be issued [at time of writing]. In a major push, casinos are launching a host of marketing campaigns, bringing new life to resorts and innovations to their casino floors.

“We will empty out our pockets in marketing dollars in 2014 and sort of judge things a year from now,” commented Seth Palansky, a spokesman for Caesars. “When you think of all the options that players expect, it’s a wide variety. It’s giving people the variety they wish – immediately.”

But results need to start happening soon. Investors are showing more confidence in Atlantic City and private investments in non-gaming attractions such as the Steel Pier amusement park, the Margaretville entertainment complex, a convention centre and outlet mall are all strong signs of progress. However, that progress could be thwarted if gambling is opened throughout the state.

There is also a lot at stake for online gaming companies, who have made large investments in the resort town. Companies such as bwin.party and Betfair are coming from Europe to be at the start of something potentially much bigger, rooted in Atlantic City. Many expect more states to legalise online gaming in the coming years and want to establish a brand presence. “Many of the operators are coming from Europe,” remarked industry expert Donald Hoover, “knowing that this is the most significant opportunity in the United States.”

With Atlantic City built on national gaming tourism, Gov. Christie is confident the fresh online gaming sector is the driving force needed to spark new innovation and drive people back to the casinos. He is hoping the new addition of United Airlines flights to Atlantic City International Airport from the carriers two largest hubs, Chicago and Houston, will “make anybody in the country who wants to fly to Atlantic City, be able to fly to Atlantic City,” said Christie. This year is “pivotal