Rhode Island has become the seventh state to allow residents and visitors to gamble on casino games remotely by phone, computer and tablet, but question marks remain about how internet gaming will work and how much money it will bring in.
Some observers are also raising questions about whether at least one portion of potential online offerings – online poker – will ever become reality because of provisions added to the legislation just before it was passed by the General Assembly.
A crucial modification to the “iGaming” bill before final passage was a compromise requiring that table games such as blackjack and poker be run by live dealers instead of computer software – a change made to sidestep worries from the R.I. Lottery that the original iGaming legislation could be an unconstitutional expansion of gambling.
The change will require the construction of a “miniature casino” that has been likened to a TV studio where table games and poker will be simulcast by Bally’s Corp., which has been given exclusive rights in partnership with International Game Technology PLC to manage iGaming.
Geolocation technology will verify that players – who must be 21 and over – are physically within Rhode Island, although the law also allows for out-of-state betting in specific circumstances, provided that the R.I. Lottery has entered into an agreement with another state regulator.
The iGaming law will go into effect on March 1, 2024, but Bally’s hasn’t publicly said when it will have its system operational.
Elizabeth Suever, Bally’s vice president of government relations, said the lottery division is currently moving through the regulatory process and iGaming “cannot go live until the regulatory and licensing process is complete.”
How will iGaming work?
“It’s too soon to tell,” said R.I. Lottery spokesman Paul Grimaldi. “We haven’t yet worked out a regulatory [framework].”
Also uncertain: how much money iGaming will generate in revenue.
In February, Bally’s told legislators the expansion could bring $210 million into state coffers over five years. A separate state-backed study by Christiansen Capital Advisors LLC had a more conservative estimate of $162 million for the same period.
After R.I. Lottery Director Mark Furcolo expressed concern that gamblers’ appetite for iGaming would eat into the revenue from traditional lottery products, the iGaming legislation was amended so that Bally’s would be required to cover at least some shortfall caused by cannibalization.
A more refined state revenue estimate will be produced in November, according to Senate spokesman Greg Pare.
Questions remain about other aspects of iGaming, too.
Take online poker. While some players thought iGaming would give them the chance to participate in poker games with money bets, others said the investment required and live dealer provision may make it a nonstarter in Rhode Island, particularly given poker was projected to bring in only 2.6% of the iGaming revenue.
As of now, Bally’s doesn’t have an online poker platform and would have to invest money to build one. And the live dealer requirement would negate the ability for fast play on multiple tables that online poker players seek, according to people who track the gambling industry.
Jessica Welman, editor of SBC Americas, a gaming industry trade publication, said Bally’s could enter into interstate agreements to stream table games such as blackjack and roulette.
“It’s cheaper because that technology already exists,” she said.
As for investments in streaming live dealer poker? “Nobody has ever done that” said Welman, who briefly worked at Bally’s Corp.’s digital arm, Bally’s Interactive.
