U.S. iGaming Markets Shake Up Old World Order

September 15, 2021
Three U.S. states figured among the top ten regulated online gambling markets in the world during the first half of 2021, representing a likely precursor to deeper disruption of the European-centric established order by the U.S. and other emerging markets.


Three U.S. states figured among the top ten regulated online gambling markets in the world during the first half of 2021, representing a likely precursor to deeper disruption of the European-centric established order by the U.S. and other emerging markets.

The spread of legal sports betting and concurrent boom in iGaming revenue in the United States has seen the U.S. emerge as the key driver of growth in the global online gambling industry, presenting operators and suppliers with their largest ever new market opportunity and dominating business strategies on both sides of the Atlantic.

The primacy of the U.S. within investor presentations and as a driver of merger and acquisition activity since 2018 has been backed up by its consolidation since the onset of COVID-19 as a multi-billion-dollar market in terms of both online sports betting and gaming.

Full-scale regulated U.S. sports-betting revenue across 19 reporting states more than trebled year-on-year to $3.08bn in the 12 months to June 2021, with online gross gaming revenue leaping by 312 percent to $2.61bn or 85 percent of the total.

New Jersey accounted for $590m or 24.3 percent of the $2.61bn online total, ahead of Pennsylvania with $392m or 16.2 percent.

Nascent markets Illinois, Colorado, Michigan, Tennessee and Virginia, each of which launched in earnest during the pandemic, collectively contributed $888m or 36.6 percent of total online sports-betting gross gaming revenue over the same period.

Adding this to estimated igaming gross revenue of $2.92bn over the same period — yielded almost entirely from New Jersey, Pennsylvania and Michigan — VIXIO GamblingCompliance estimates that total U.S. online betting and gaming GGR totalled $5.53bn in the year to June 2021.

This significantly expanded total lifted the U.S. above both Italy and Australia to second place in a country-level comparison of regulated online betting and gaming revenue globally, surpassed only by the mammoth UK online market, which remained more than twice as large.

US market size vs selected markets

At a more granular level, our analysis indicates that individual U.S. states have begun to disrupt the highest level of a global ranking of regulated markets by gross gaming revenue (GGR), which has long been dominated by European jurisdictions.

VIXIO GamblingCompliance estimates indicate that three U.S. states, each of which are home to legal igaming as well as sports betting, figured among the world’s ten largest regulated online markets in the first six months of 2021.

New Jersey and Pennsylvania, which cracked the top ten in 2019 and 2020 respectively, have overtaken Spain and Sweden to occupy fifth and sixth places in the global comparison during the first half of 2021.

online market size rankings

Meanwhile, new entrant Michigan achieved the rare feat of joining this elite group in its first six months as a regulated market, having rapidly risen to prominence following a "big bang" launch of all major U.S. online betting and gaming brands at the business end of the 2020-21 NFL playoffs.

Europe, which remains the epicentre of regulated online gambling globally and yielded total online GGR of around €20.6bn in 2020, was home to just three of the top five and six of the top ten markets in the first half of the year.

Italy was the only member of this group to rise in the global rankings, overtaking Australia to take second spot amid a step change in the market’s scale driven by accelerated retail-online channel shift catalysed by periods of national lockdown since the onset of coronavirus.

Overall Italian online GGR soared by 78 percent year-on-year to €1.97bn in the first half of 2021, having grown by 45 percent to €2.6bn in 2020 as a whole.

Australia, which had previously maintained second place in the global rankings despite a national ban on online casino games, fell one place as online growth normalised following the resumption of retail betting for the majority of the period.

VIXIO GamblingCompliance estimates that GGR in the mature, racing-centric Australian online betting market ramped by 46 percent to just over A$5bn (US$3.7bn) in calendar 2020 as racing continued behind doors and retail options were largely shuttered.

Looking ahead, a further upheaval of the old world order can be expected in the medium-term as Ontario, Brazil, Germany and the Netherlands complete their transition to newly or fully regulated online markets, New York and potentially Florida launch online sports betting and new opportunities for state-level igaming regulation emerge in the U.S.

By 2025, the combined U.S. online sports betting and internet gaming market is expected to generate gross revenue upwards of $20bn, according to the latest monthly forecasts generated by VIXIO GamblingCompliance’s U.S. Sports Betting & iGaming Data Dashboard.

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