California has routinely been referred to as the state that could make or break the future of regulated online poker. It is the largest state in the nation, boasting more than 12 million residents than Texas, the next state in line, and over 28 million more residents than New Jersey, currently the largest state to pass a bill legalizing online poker. In the eyes of the major supporters for online poker regulation, California is viewed as hopefully being too big to fail.
In anticipation of California entering the fold, multiple sources have tried their hand at calculating the projected revenue the state stands to earn as a result of enacting a bill to regulate online gaming. The numbers are grand, with reports for anticipated revenue in the first year ranging vastly from $132 million to $729 million. Analyzing the numerous data and applying perspective and reasonable rationale, Chris Grove of onlinepokerreport.com cautiously estimates that California could pull in roughly $200 million in its first year.
New Jersey Governor, Chris Christie, projected that his state would make $160 million in its first year from online gaming. At the end of May, with one month remaining in its fiscal year, the state had only made $9.3 million. Many reasons have been stated for New Jersey’s failure to reach expectations, such as the state’s dependence on the most optimistic projections and utilization of a year-long forecast despite the fact that online gambling did not go into effect until late November, which left five months remaining in its fiscal year. Furthermore, multiple state senators and representatives believed that the number was unrealistic from the jump, stating it was used mainly for political and budgetary reasons.
Using New Jersey as a test case, there’s no reason why California cannot eclipse the $200 million mark. While projected revenue estimations of $624 million and $729 million are clearly bullish, Academicon’s and Eiler’s Research respective estimation’s of $217 million and $225 million seem well within the Golden State’s reach. Even Gambling Data’s estimation of $317 million does not seem that far-fetched for a state that has well over 38 million residents.
California can learn from New Jersey’s mistakes in order to maximize its attainable revenue. New Jersey struggled with ensuring that players were actual residents of the state, and ran into issues with processing payments. By avoiding these same obstacles and streamlining the implementation process to ensure that online poker sites in California go live at or as close to the beginning of the fiscal year as possible, California will have sufficient time to meet its ultimate potential.