Study suggests Indiana could look at online gaming legalization in the future

Neil Roarty profile picture
Updated 2 months ago on

2 min read

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The Indiana Gaming Commission has taken a step closer to legalizing online gaming and casino after releasing a 103-page-study commissioned from Spectrum Gaming Group. The report considers a wide range of factors across the report, from policy through to revenue forecasts and employment impacts as well as more specific issues such as anti-money-laundering practice, responsible gambling implications and deductions of promotional expenses.

The report has 80 figures comparing, contrasting and forecasting Indiana versus other states with igaming, and looking best to model the impact of legalization of the online casino market. Seven states allow some sort of igaming, although Nevada is limited to Poker so for the purpose of the study is disregarded. The big three states who allow igaming are Michigan, New Jersey and Pennsylvania.

Each of the aforementioned trio generate more than US$1bn GGR on an annualized basis, thus offering the best insights into potential igaming in Indiana and how it could operate.

The report outlines three models for potential igaming expansion in Indiana:

  • Open Model: available to all gaming companies – whether they are the state’s casinos or are pure-play digital gaming operators that have no other gaming interest in the state
  • Closed Model: in which licensure is limited solely to the state’s casinos
  • Hybrid Model: in which casinos are provided some level of exclusivity or primacy but third-parties are permitted to offer digital gaming through licensing agreements – also called “skins” with in-state casinos

The report models three different tax rates (from 20% – 45%) where one would expect it to fall on higher. Spectrum realises that given there’s few direct employees in igaming operations, having the focus shift from retail to digital could result in job loss should retail revenue be cannibalized, but the study shows that this would unlikely be the case. igaming users are suggested to be younger, and overall a different demographic with different spending tendencies.

The study also highlights the potential negatives and shortcomings of igaming, with potential increases in problem gambling, additional funding needed for treatment services; but also goes on to emphasize that the state is well placed given existing infrastructure built to service the landbased industry.

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Neil Roarty is a gambling industry veteran with over 15 years experience writing and editing in both Europe and North America. He is a regular speaker at gambling conferences and appears as an author in many industry publications.

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