A Business Overview of Casino Games

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As an accountant, I like to familiarise myself with the business side of things that I love. Getting the big picture helps you understand how your industry of interest operates and where you fit into the big picture. In today’s blog, we’ll take a look at the casino gaming industry and how it works.

How online casinos work

In online casino games, the players play against the house, which allows the house to have leverage over the player, also known as the house edge. Therefore, the player cannot determine how much they are going to win as this is decided by the jackpot available on the house.
The house offers different types of games like blackjack, roulette, craps, baccarat, video poker and slot machines. Player liquidity is not as significant in the case of online casino games as it is in the case of games played against other players, such as poker. Players can also choose to play against other players in multiplayer games, so that they get the feel of playing in a physical casino.


Size of the industry

The online casino gaming industry in Europe is estimated to be roughly €2.5bn of GGR in 2013, and is predicted to increase to €3.3bn by 2018. In the United States, online casino games are regulated in New Jersey, but even despite this the industry forecast is that it will increase to €2.2bn by 2018, as there are other states in the process of regulating the industry.

US online casino gaming industry

Online casino games in the US seemed to be immune to recession, until the year 2007 when it began to show a steady decline from 2008 to 2009. It became more stable in the year 2010 but its success is mostly dependent on political and economic factors that may be influenced by the way voters choose their candidates.

Drivers of change in the online casino gaming industry
Online casino games are subject to change through drivers that can determine how well the industry progresses over the next couple of years:

  • Cross border liquidity: There is a huge difference in the way the casino industries in large sized and small sized countries have been growing. It is pretty obvious that players will soon be affected through not being able to pit themselves against a diverse and large enough set of players, if gameplay continues to remain localised. To counter this, it is important for countries to allow players to play across the globe and overcome any regulatory challenges this may present.
  • Taxation: Taxes should be pragmatic and should not negatively affect the player.
  • Changing perceptions: While poker is seen as a legitimate game, played for decades now, horse race betting may not be able to grow to this extent due to the stigma involved.
  • Social networks: Social networking can be combined with online casino gaming to drive the industry forward.

At the outset, regulation will play an important role in determining how well the US casino gaming industry progresses.

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