Penn State Study Fuels iGaming Debate

A recent study conducted by Penn State has sparked renewed discussion about the impact of online gambling in Pennsylvania. The university has been producing its annual Interactive Gaming Assessment since 2020, a project funded by Pennsylvania Act 42, which legalized iGaming in the state in 2017. The study aims to assess the prevalence of online gambling, identify reported issues among online gamblers, and analyze consumer trends within the industry.

Growth of Online Gambling in Pennsylvania

The Pennsylvania Interactive Gaming Assessment: Online Gambling Report indicates a steady increase in online gambling participation over recent years. In 2021 and 2022, 11% of Pennsylvania's population engaged in online gambling. By 2023, this figure had increased to 16%, and in 2024, 20% of residents reported placing bets online. Despite this growth, online gamblers still make up a minority of the overall gambling population, with 65% of Pennsylvanians engaging in some form of wagering either online or offline.

A significant portion of the state's gamblers still prefer land-based casinos. In 2024, 46% of gamblers exclusively visited physical establishments, while slightly more than 2% gambled solely online. The remaining 18% participated in both online and land-based gambling.

Demographics and Gambling Habits

The study found notable differences in gambling behavior between online and offline players. Those who gambled exclusively online did so at rates two to three times higher than those who only visited physical casinos. This group tended to be younger and predominantly male. In contrast, offline gamblers were more likely to be older and female.

Motivations for gambling also varied between groups. The majority of offline gamblers cited entertainment and enjoyment as their primary reasons for wagering, whereas online gamblers were more likely to say they played to win money.

The study also identified the most active gambling group as those who participated in both online and land-based gambling. This cohort spent the most time and money on gambling activities.

Responsible Gambling Concerns

The issue of responsible gaming remains a focal point of the study. In 2024, nearly half of all calls to the National Problem Gambling Helpline, 1-800-Gambler, referenced online gambling as the primary concern. Out of 2,370 total calls, 1,171 were related to online betting.

Seventeen percent of Pennsylvanians reported gambling at least once per week, while 34% gambled at least once per month. A problem gambling screening conducted as part of the study found that 8% of the state's population was at risk for problem gambling.

Additionally, more than 6% of survey respondents admitted to participating in either illegal or underage gambling, highlighting the continued presence of offshore casinos despite the availability of legal options.

Impact on Land-Based Casinos

The study also examined the potential impact of online gambling on traditional brick-and-mortar casinos. The data revealed that the number of Pennsylvanians visiting land-based casinos remained nearly unchanged year over year. Revenue trends showed that slot machine earnings remained flat, while table game revenue saw a slight 3% decline. In contrast, online gambling revenue surged by more than 25%, reaching $2.2 billion in 2024.

Despite the lack of growth in land-based casinos, Pennsylvania's revenue trends aligned with those of other states with commercial gambling operations. Nevada, for example, saw a six-month revenue decline on the Las Vegas Strip, despite not having online gambling options.

Future Outlook and Industry Implications

The rapid adoption of online gambling in Pennsylvania has raised concerns about potential increases in problems related to gambling. Some observers worry that the rising popularity of online betting could lead to a higher prevalence of gambling-related issues in the coming years. Others argue that online gambling platforms offer more built-in safeguards and responsible gaming controls compared to traditional casinos.

While the 8% figure for problem gambling risk could be cause for concern, helpline data does not indicate an increase in problem gambling cases. The total number of calls to 1-800-Gambler declined in 2024 to 2,370, down from 2,834 in 2023 and 2,401 in 2022.

Regarding concerns about online gambling reducing revenue for land-based casinos, the study suggests that Pennsylvania's flat growth in traditional casino revenue reflects broader industry trends rather than being a direct result of online gambling expansion.

Overall, the findings suggest that online and land-based gambling continue to coexist without clear evidence of one cannibalizing the other. Instead, the study indicates that both sectors remain stable, with online gaming experiencing rapid growth while traditional casino revenue remains largely consistent.