- In the first full year after PASPA’s repeal, New Jersey handled the second-highest volume of wagers.
- With another strong year in 2020, the state could challenge Nevada’s sports betting supremacy.
- Sportsbooks capitalized on online betting platforms and New York City to fuel this growth.
TRENTON, N.J. – With 2019 officially in the books and annual revenue reports mostly complete, New Jersey has emerged as a surprise challenger to Nevada’s stranglehold on the sports betting industry.
After the state handled $1.2 billion in sports wagers over the final four months of 2018, there was some specuation that it could eventually surpass Nevada’s sports gambling industry, but few anticipated sports betting becoming so lucrative so quickly.
New Jersey handled $4.58 billion in sports wagers in 2019 – $1.76 billion more than the combined handle of the seven other states that reported sports betting financial data. Nevada hasn’t reported its December totals yet, but the state is projected to end the year with around $5.25 billion in total handle.
A gap of $670 million is sizable, but if New Jersey sees even half the growth it did from 2018 to 2019, it could surpass Nevada as early as next year. Nevada is by far the most established sports betting market in the United States, meaning its year-over-year growth potential is limited.
New Jersey’s sports gambling industry, by contrast, is in its infancy. 2019 was its first full calendar year of operation. Despite that, in three separate months, the state handled more wagers than Nevada.
At this point in time, it seems not just likely, but inevitable that New Jersey will overtake Nevada as the highest volume sports wagering market in the United States.
How Did This Happen?
New Jersey was the state that initiated the legal challenge that ended with PASPA being repealed in 2018, and its clear that there was a plan in place in the event of a repeal. The Supreme Court declared PASPA unconstitutional in May of that year, and by June, New Jersey was taking its first wagers.
Home to Atlantic City, the state is already well-accustomed to the sports gambling industry, but it was the government’s eagerness to embrace online sports betting that vaulted it to the top.
The state worked with East Rutherford-based daily fantasy sports titan FanDuel to launch an accessible online and mobile sportsbook tied to a familiar brand. FanDuel Sportsbook was a runaway success and has since expanded to other states, including West Virginia, Indiana and Pennsylvania.
While Nevada has decades of Vegas-centric marketing powering its dominance of the casino industry, New Jersey has an advantage that Nevada can never hope to match – easy access to New York City. The Big Apple’s 8.6 million residents are just a short train ride away.
The Garden State wasted no time in capitalizing on this marketing opportunity. According to one FanDuel report in Summer 2019, 25% of its accounts are registered with New York addresses. Many New Yorkers reportedly use train stations located in New Jersey to place bets.
This vacuum in the New York market paved the way for New Jersey’s explosive growth, but it also represents an ever-present danger. If New York ever legalizes online sports betting, it will severely cut into New Jersey’s revenue figures.
This looks unlikely for the time being. New York has been more restrictive of its sports bettors than other states, prohibiting both online gambling and bets on in-state college teams, but another huge year for sports betting in New Jersey could pressure New York lawmakers into enacting changes.
With laws likely to remain unchanged throughout the next year, there’s nothing to indicate that New Jersey’s growth is going to slow any time soon. And barring major changes in Nevada, there’s a good chance that twelve months from now we’ll be talking about a new king of sports betting.
With a dual background in English and sports performance and business analytics, Carter aims to write stories that both engage and inform the reader. He prides himself on his ability to interweave empirical data and traditional narrative storytelling. When he isn’t keeping readers up to date on the latest sports betting legal news, he’s banging his head against a wall regretting his decision to be a Tampa Bay Buccaneers fan.