Pennsylvania's Parx Casino Online Shakes Up Online Gambling
CEO of Parx Casino, Anthony Ricci, expressed concern for the online gambling market plans of Pennsylvania. Expectations were high for an online casino market in Pennsylvania similar to New Jersey’s online gambling market, and just as online casinos have low tax rates in New Jersey, the same is expected for Pennsylvania.
However, Parx, being the largest brick-and-mortar casino in the state, has more to lose from this arrangement.
Ricci stated in disapproval, “I find it impossible to assume that a brick-and-mortar casino paying 59% in taxes will not lose significant business to an online operator paying 15% in an open, unprotected market.”
He told legislators at a public hearing that state coffers would take a hit with half of the online gambling revenue pulling away from brick-and-mortar revenue.
Matt Cullen and Greenwood Gaming and Entertainment
Parx’s owner, Greenwood Gaming and Entertainment (GGE) applied for the online casino license in July 2018, becoming the first Pennsylvania operator to do so. The company then hired former CEO of Manuel Digital, Matt Cullen, to lead this project. This was a major decision for Cullen as it required him to relocate his family from California to Pennsylvania for the role of senior vice president of Interactive Gaming and Sports.
Since his start with the company, Cullen has been busy building an online gambling team. However, no one has seen signs from the PA Gaming Control Board (PGCB) for a date to go live with online gaming.
Greenwood Gaming sportsbooks
Cullen is working with all of Greenwood’s assets, such as the company’s numerous sportsbooks, including one at the South Philadelphia Turf Club and the other at Parx. Plans are in action to open the third sportsbook at the Valley Forge Turf Club as well.
“It’s definitely a benefit from a risk-management perspective but more so it’s an opportunity to simply reach more people,” Cullen says. “Philly is the fifth or sixth largest city in the country. There are millions of people there and three locations is a very distinct advantage compared to some of our competitors. We’ve got four other licenses we could utilize for other Turf Club sportsbooks if we want but we’ll probably sit and see how online starts and how it affects the retail business. Certainly, for the foreseeable future, we have a distinct advantage.”
Parx strategy for brand recognition
Parx is creating recognition through its unique special feature, Betslip Builder. This mobile app allows players to fill out a bet slip as well as create a QR code which can be scanned via casino teller. The company plans to launch a sportsbook under the same branding once the PGCB gives the go-ahead.
Although tax rates are through the roof for Parx’s brick-and-mortar casinos, the outlets provide another marketing channel for the online gambling product, regardless.
Parx casino hefty tax rates
Taxes are set at over 36 percent for sports betting and higher than 54 percent for online slots. Therefore, online outlets are required for gaining reasonable profits. Cullen seems enthusiastic, however, stating that he plans for Parx to be a market leader in the state of Pennsylvania both online and land-based.
“The tax rate on land-based is a challenge and we do just fine so I think we can operate in the exact same way. It doesn’t mean our customers aren’t getting the best experience in terms of bonus and offers but you just have to be a lot more careful about what you do. And if you bring in the right people you can go out and execute on it.” Cullen stated.
Partnerships with Parx Casino online
Parx partnered with London-based technology supplier, GAN. The supplier has proven success with Betfair Casino and FanDuel in New Jersey already. Parx’s online sportsbooks are powered by Swedish-based supplier Kambi, whose proven success was also in New Jersey with DraftKings and SugarHouse.
Wire Act leads to confusion for Parx Casino online
Now that the DOJ has decided to reevaluate the Wire Act, there has been added confusion to the mix. As this reevaluation is causing many to question whether or not this piece of the legislation refers to all forms of online gambling, the PGCB has warned operators to pace themselves and work with the new opinion.
Cullen does not fear any hindrance on Parx, however, content suppliers may experience difficulty down the line as their servers are not all based in Pennsylvania.
Is poker out for Parx?
Interstate poker is out of the question now as well, however, Pennsylvania poker does not expect as hard of a blow as other states who have been in the game longer and have a higher number of residents.
Despite all of this, Parx still has sights set on online poker. The company’s land-based poker rooms are doing well, therefore, they would like to replicate this online.
New market, new people
Pennsylvania could prove to be a challenging market, however, Cullen is confident in the team he has been building. Just as we’ve seen in NJ online gambling, the amount of people who have experience in this industry is low. It’s a relatively new market for the U.S.