Land based casinos should love online gambling

A heated battle is brewing between thousands of online poker players and California’s largest land-based casino. It began in July when Commerce Casino Vice President Tom Malkasian voiced his opposition to current proposals to legalize Internet gambling in testimony before the House Financial Service Committee. And Commerce Casino isn’t alone. Many land-based casinos vehemently oppose legalization, largely out of fear of increased online competition. Those fears are misplaced.

Malkasian has argued that one such proposal, sponsored by Rep. Barney Frank, “would ship jobs, revenue and taxes beyond our communities.” But that ship sails in both directions. American land-based casinos that developed online platforms would be able to offer their service to customers around the world as well. Land-based casinos in the United States, which have seen profits decrease over the last decade, could increase their consumer base to anyone in the world with a computer and Internet connection.

According to the market research firm Mintel, the number of adults visiting casinos in 2009 had declined by 14 percent since 2001. While the availability of Internet gambling did account for some of that decline, analysts at the firm determined that casinos were losing customers to other competing forms of entertainment like HDTV, and video games, not just to Internet gambling. Brick-and-mortar casinos should see this as an opportunity rather than a threat.

Online gambling platforms, whether for real money or just for fun, provide low-pressure environments where anyone can learn the rules of particular casino games. Once comfortable with the rules and mechanics of specific games, players are far more likely to consider a trip to a land-based casino. This especially applies to members of the X, Y, and Millennial generations, who are more tech- savvy than any other previous generation.

Land-based casinos are no longer the only game in town for gambling. No amount of legislation or regulation will stop Americans from finding new ways to play online. Keeping online gambling illegal will still not increase the number of visitors to brick-and-mortar casinos. Young adults are far more interested in entertainment options available to them in their own home than they are in playing casino-style games. If land-based operations have any hope of appealing to that generation and surviving into the future they ought to embrace legalized online gambling.