Lottery, Online Gambling Boom Not Enough To Find a Home in Nevada

Written By J.R. Duren on December 29, 2022
lottery and online gambling not welcome in nevada

Nevada’s network of casinos and resorts draws billions of dollars every year. And they want to keep it that way.

Nevada is one of just three states in the continental United States that doesn’t offer a lottery, and it’s also part of a bigger group that prohibits online casinos. Keeping the lottery and online gambling out means that retail casinos keep their revenue stream coming in.

In October 2022 alone, Nevada casinos raked in $1.28 billion in revenue. It marked the 20th straight month revenue topped the $1 billion mark.

Online gambling is a massive industry but has no home in Nevada

The US online gambling industry surpassed $3.5 billion in revenue in 2021, according to the American Gaming Association. That number is staggering considering online gambling revenues from past years:

  • 2020: $1.6 billion
  • 2019: $500 million
  • 2018-2014: Less than $500 million each year

To put it plainly, online gambling revenue went up 700% in two years. That growth is expected to slow in 2022 to below 40%. However, that still puts online gambling revenue at more than $4 billion among the six states that allow it.

So why would Nevada want to miss out on this revenue? The simple answer is that keeping gamblers in casinos increases resort revenues. A person sitting at home playing slots on their phone isn’t buying drinks, meals, or hotel rooms.

The Las Vegas Review-Journal pointed out this fear among casino operators, citing a recent report from a Deutsche Bank analyst. The report revealed that casinos in states with no online gambling seemed to bounce back quicker from pandemic losses than states with online gambling.

Will the lottery ever come to Nevada?

Online gambling is a definite threat to the Nevada casino industry. But, at this stage in its lifespan, that threat is relatively tame compared to state lotteries.

For example, here are the lottery sales figures for 2021 in the top-five states:

  • Florida: $9.08 billion
  • New York: $8.59 billion
  • California: $8.42 billion
  • Texas: $8.11 billion
  • Georgia: $5.88 billion

Those five states alone generated around $40 billion in lottery sales. While it’s hard to find firm numbers on how lottery sales affect casino handle, there’s no doubt casinos lose money to lottery sales.

However, the impact on Nevada’s casinos wouldn’t be as severe as it is in, say, New York. Nevada’s population is just over 3 million people, while New York has more than 20 million people (Florida, California, and Texas have more than 29 million people).

Perhaps a better comparison for Nevada would be Arkansas and Iowa, which have roughly the same population. Those two states generated $632 million and $453 million, respectively, in 2021.

If a Nevada lottery generated $500 million in sales each month, those sales would likely make a relatively small dent in casino handle (the total bets placed before winnings and promos are subtracted).

But despite what would be a seemingly mild impact on handle, casinos will likely continue to fight hard against any type of state lottery. So, for now, Nevada residents will have to pop over to California and other lottery-friendly states to get their chance at big multi-state jackpots.

Photo by PlayUSA
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J.R. Duren

J.R. Duren has covered the gambling beats for more than a dozen states for Catena Media since 2015. His past reporting experience includes two years at the Villages Daily Sun, and he is a first-place winner at the Florida Press Club Excellence in Journalism Contest.

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