Staff Columnist

Iowa should go all in on internet betting

Expand and deregulate the gaming industry

A player reaches for his martini during a Texas Hold 'Em poker tournament at the El Kahir Shrine Center in Cedar Rapids on Friday evening, June 24, 2005. 53 players were in the tournament that was organized by the Delaware County Shrine Club. 60 percent of the money earned went to a charity.
A player reaches for his martini during a Texas Hold 'Em poker tournament at the El Kahir Shrine Center in Cedar Rapids on Friday evening, June 24, 2005. 53 players were in the tournament that was organized by the Delaware County Shrine Club. 60 percent of the money earned went to a charity.

The gaming industry has a demographics problem, and the casino lobby’s efforts to expand may prove counterproductive.

State policymakers in recent years have discussed several ways to expand legal gambling to the internet, including lottery e-tickets, sports betting and online poker, all of which would be more attractive to younger players who are not interested in traditional betting.

Understandably, the gaming establishment has watched those discussions closely, supporting policies that would sustain or strengthen their grip on the gambling market.

Iowa Racing and Gaming Commission
admissionsadjusted gross revenue
201421,115,210$1,396,008,023.00
201521,651,881$1,424,351,470.00
201621,774,455$1,446,163,715.00
201721,393,516$1,462,923,851.00
201820,703,169$1,463,808,371.00
-1.95%4.86%

It’s a timely conversation, since admissions to Iowa gambling sites have been stagnant over the last five years, dropping from 21.1 million visits in 2014 to 20.7 million last year. Revenue throughout the racing and gaming system is growing, but only by about 5 percent over that timespan.

The casinos don’t report detailed data about their patrons’ ages, but I can tell you from personal experience that the industry’s future is lackluster. When I visit casinos in Iowa, I typically am one of only a handful of apparent 20-somethings playing.

Research shows many younger Americans do enjoy visiting casinos, but my peers are not necessarily drawn to the games themselves.

In a 2016 study from the Institute of Gaming, Hospitality and Tourism at Stockton University, millennials reported spending only 9 percent of their resort budget on gambling, compared with 24 percent for non-millennials. Just 44 percent of millennials play slot machines, by far the most common offering on casino floors, compared with 72 percent of everyone else.

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To put it bluntly, casino gambling is an old person’s sport. That’s bad news for those of us who want to see gaming survive and grow.

Casinos sometimes resist the expansion of online gambling because they expect it would encourage people to stay home instead of betting in person. Their opposition is predictable, but I argue it is shortsighted. Online gambling presents an opportunity to engage new audiences of younger players who I’m confident will eventually show up to the brick-and-mortar casinos.

Consider poker as one example. No sensible person would show up to a casino and risk $100 or more on their first competitive poker experience. Instead, novice gamblers are more likely to test their skills in a virtual setting with low stakes, and then move up to playing in the casino.

There was an unsuccessful bill in the Iowa Legislature last year to authorize sports betting in-person and online, after the U.S. Supreme Court struck down a federal statute that strictly limited states’ sports betting programs. Gaming lobbyists supported that bill, since it would have put the new system under control of existing licensees.

I hope lawmakers will be highly skeptical of any proposal to gift the entire online gambling market to the small number of existing outlets. That will only stifle competition and hamstring the movement to introduce younger audiences to gaming.

Iowa does not have to follow the path of other states, which have painstakingly crafted policy specifically intended to protect established businesses. Instead, let’s unleash the industry and watch it grow.

l Comments: (319) 339-3156; adam.sullivan@thegazette.com

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