Atlantic City’s Future in Question

November 11, 2014 Posted in Announcements, Editorial, In The Headlines by No Comments

It’s not breaking news that New Jersey’s casinos are closing at a shocking rate. This year, we watched the Atlantic Club close its doors in January, followed by Showboat, Trump Plaza, and Revel this Fall. Tourism in Atlantic City is down as New Jersey gamblers head to newer, cleaner, safer venues in New England, New York, and Pennsylvania. In Maryland, the brand new Horseshoe Baltimore is a cutting edge resort that offers everything from shopping and gambling to first-class accommodations, all within day trip distance for the bulk to New Jersey gamblers.

But what about New Jersey’s online gambling arena? Surely that’s thriving, right? If the inconvenience of getting to Atlantic City is what’s keeping players out of the casinos, then players should be flocking to their desktops, tablets, and phones to gamble in the ultimate convenience of their own homes over the likes of Horseshoe Baltimore and Mohegan Sun. Right?

A Changing New Jersey; A Changing America

Wrong. Internet gambling in the Garden State’s had a lukewarm reception at best, and the sites offering it are suffering just as badly as the physical sites along the boardwalk. Is it just that New Jerseyans simply don’t like to gamble anymore? Partially. Atlantic City’s revenues have been steadily dropping every year since 2006, and this trend is poised to continue unless something changes. Millennials, the crop of young adults in their twenties and early thirties, are way less into gambling than their parents and grandparents are. As approximately one third of America’s population, millennials are changing society in so many ways, one of which is how we spend our free time and disposable income.

We can’t just pin this on people’s gambling habits, though. Even if people were blowing up New Jersey’s gambling sites’ servers, they’d still be facing issues with the physical casinos closing because they’re all connected. Under the revision to the New Jersey Casino Control Act that allowed online casinos to operate in the Garden State, all servers for these websites have to be housed within Atlantic City’s gaming properties. When a brick and mortar casino closes, the server inside it needs to find a new home or be shut down. With the closures of Trump Entertainment Resorts’ remaining properties this year, this is exactly the dilemma that Ultimate Casino and Betfair faced.

Ultimate Casino’s Ultimate Ending

Ultimate Casino’s server was housed in Trump Taj Mahal, the 24-year-old casino and hotel that’s set to close permanently at the end of November. Previously, its closing date was November 13th, but the company was recently able to work around the contract issue it experienced with its workers’ union. That said, the property’s owner, Carl Ichan, stands by his statement that the casino will likely close in the near future.

In September 2014, Ultimate Gaming, which operated Ultimate Casino and Ultimate Poker in New Jersey, announced its break with the Taj Mahal over contract disputes and Trump Entertainment Resorts’, Taj Mahal’s parent company, bankruptcy that ended up causing the company’s other property, Trump Plaza, to close. Now that Ultimate’s operations in New Jersey are done for good, the company is refunding players any credit that remained in their accounts as of its closure on September 22nd. Players will be able to access their u-points balances until November 22nd and are currently being directed to Golden Nugget Casino Online, where they can get credit bonuses for the XP-Points they racked up at Ultimate Casino.

A Fair Chance of Survival for Betfair

The other gambling site associated with Trump’s properties was Betfair casino, part of the larger Betfair company based in the United Kingdom. Betfair’s New Jersey site’s server was housed in Trump Plaza, which ceased operations in September 2014. Unlike Ultimate, Betfair took a different route when its partner couldn’t continue. Its management team worked out a special deal with the New Jersey Division of Gaming to find a temporary home and continue to operate. That temporary home is Caesar’s Atlantic City. Betfair may operate out of Caesar’s for six months following this decision, during which time it has to find a new brick and mortar partner or pull out of the New Jersey gambling market altogether.

Only Time Will Tell

They can’t all be winners. At the risk of sounding corny, I’ll say this much: getting in on a fledgeling industry like internet casinos is always a major gamble. Betfair, Ultimate, and all the other online casino companies who rushed to grab New Jersey casino operation licenses and set up their sites knew this, and went ahead anyway hoping to score a jackpot with New Jersey gamblers. Betfair and Ultimate are two examples of very different ways of handling a setback: Ultimate decided it was too much trouble, tossed its hands in the air, and got out of New Jersey’s cyberspace. Betfair recognized the obstacle before it and chose a different route: pressing on ahead with a new partner. Only time will tell if Betfair made the right choice. Until then, Atlantic City’s landscape will no doubt continue to evolve as Revel prepares to reopen and gamblers, with fewer casinos to choose from, choose who will survive this slump.