Heavy US Activity for the Year Suggests Massive State Revenue Gains in Regulation

Published March 3, 2017 by Lee R

Heavy US Activity for the Year Suggests Massive State Revenue Gains in Regulation

Regulated IRs are going to cut losses in other leading jurisdictions.

The non-regulated US led the world in gambling losses by country last year, reminding the world of how massive the US gambling market is.

American Gambling Losses

UK-based betting and gaming consultancy Gambling Capital (H2G) places the figure for American losses at $116.9 billion for 2016.

Activity Centers

The most popular places to gamble among US players were brick and mortar casinos, with lotteries coming in second, followed by non-casino gaming machines, and then online gaming, keeping in mind that online gaming is actually only fully regulated in two states in the US.  

Scaling the Potential

These numbers give a scale to the massive untapped potential of the US gambling market.  The American Gaming Association AGA estimated that Americans bet $4.7 billion on Super Bowl 51, of which 97 percent ($4.5 billion) was wagered illegally, contributing to overall estimated totals of $154 billion wagered by Americans on all sports, with the majority of those wagers processed via bookies and offshore, illegal web sites.

Implications

The massive level of illegal gambling in the states provides a general estimate for the extent to which revenues from similar levels of betting activity could be collected by state governments in the form of percentage-based taxes, not to mention the added block income levels available from flat licensing fees.

Per Capita Leaders

While the US topped the full year losses chart last year, Australia reportedly was the national leader in losses per resident adult at $990, with Singapore second at $650 per capita. This figure is twice as high as the average loss in other Western countries and 40 percent higher than category runner-up Singapore.  Ireland followed with $500, then Finland ($425) and the US fifth with $420 lost per person.

IRs in the Orient

The liquid China jurisdiction, which includes the special administrative region (SAR) of Macau, lost $62.4 billion on gambling in 2016, with Japan coming in third at $24.1 billion for biggest loss by country.  Losses in both countries are expected to be reduced by development of Integrated Resorts in Macau as well as emerging Japanese gambling meccas. 

Undeniable US Potential

Nonetheless, these highly liquid and limited regulation regions still fell far short of the unregulated US.  With casinos in the USA making more than any other place on earth, the untapped potential of a regulated online gambling market can be characterized as nothing less than limitless in the long term.

Regulation Hurdle

In a jurisdiction where illegal activity is dominating gambling totals, sufficient protections against addiction on the part of would-be licensed operators remain the tough sell for a fully regulated US market. 

See also

Council of Legislators from US Gambling States Proposes Standards for Online Gambling

32Red Reach Record Revenue for First Half of 2016

Play’n GO Launches Demon Slot Inspired by Heavy Metal Band

New PGCB Regulations Allow Unlimited Skins

Gambling Trends: Online Casino Revenue Rises


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