Pennsylvania Leads US iGaming Market Over Michigan And New Jersey

Written By Corey Sharp on March 4, 2024 - Last Updated on March 14, 2024
Image showing online casino gaming with slot reels on devices along with the PA state outline featuring the words

Pennsylvania is the clear-cut leader when it comes to the online casino industry. The Keystone State produced $2.1 billion in revenue last year, the most among any state.

Despite stiff competition from other locations such as Michigan and New Jersey, those states are chasing the PA online casino market in almost every way.

Comparing Michigan and New Jersey to the Keystone State online casino market

Revenue is the biggest indicator determining the online casino market rankings. Pennsylvania proves to be atop the list considering 2023 totals, which also trickled into January 2024.

Pennsylvania is the only state to reach more than $2 billion in online casino revenue last year. The Keystone State’s rivals, Michigan and New Jersey, posted near identical totals of $1.9 billion in yearly earnings. Michigan finished more than $115,000 ahead of New Jersey last year.

Pennsylvania held onto the crown as the calendar turned to 2024, too. The Keystone State generated the highest total once again in January:

  • Pennsylvania: $189.3 million
  • New Jersey: $183.3 million
  • Michigan: $181.9 million

The $189.3 million Pennsylvania registered in January is actually a decrease from the prior months. In another record-breaking showing, Pennsylvania is the only market to exceed $200 million in a single month, which it did in December 2023.

Over the last four months to end 2023, the Keystone State recorded the following totals:

  • September: $187.3 million
  • October: $186.9 million
  • November: $191.9 million
  • December: $204.2 million

Pennsylvania broke three national records in those four months. Despite a slower January, the state still led the other top markets.

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The amount of online casino operators differs in each state

Each state has different rules when it comes to handing out online casino licenses. But the more operators available doesn’t necessarily mean the most revenue.

Each retail casino in New Jersey is able to partner with five online casino platforms. As of now, the Garden State has more than 25 active apps, which is the most of any market.

Pennsylvania is second, offering 21 online casinos for bettors in the state. Despite the lesser total, perhaps the Keystone State has the right operators. Pennsylvania is able to have an unlimited number of apps, as the Pennsylvania Gaming Control Board (PGCB) does not cap the amount of licenses a retail casino can supply.

Michigan has the strictest rules of the three markets. The Great Lake State has 15 online operators, which is the maximum amount it can provide. The Michigan Gaming Control Board (MGCB) allows just one license per retail facility.

The PGCB breaks down revenue by license, which makes it difficult to see the exact contributions from each operator. However, Hollywood Penn National, partnered with DraftKings Casino PA, BetMGM Casino PA, Hollywood Casino PA and Fanatics Casino PA, produced $855.4 million last year, the most of any licensee.

The Keystone State has launched five new PA online casinos since the start of 2023.

Pennsylvania’s high tax rate hasn’t stopped operators from launching

The Keystone State has the highest and most complex tax rates between the three markets. The state poses a 16% tax on poker and table games, and another 54% tax on PA slots.

New Jersey has a much simpler system, which is 15% of the internet gross gaming revenue. Michigan puts operators in a tax bracket to determine the percentage.

To no surprise, Pennsylvania generated $744.1 million in tax revenue last year, easily beating out Michigan’s $486.6 million and New Jersey’s $335.9 million.

PGCB Director of Communications Doug Harbach told PlayPennsylvania back in January:

“The Pennsylvania legislature has been aggressive in setting tax percentages on legalized gaming higher than other states. Some gaming experts therefore predicted that companies would not choose to operate in the state under those rates. That has not been the case, with most major gaming operators indeed choosing to do business here. The result is that Pennsylvania returns more tax-generated revenue to its citizens than any other gaming state.”

Pennsylvania produces the most amount of revenue and generates the most tax earnings, which benefits citizens.

The Keystone State measures out to be the top online casino market just about every way you slice it.

Photo by PlayPennsylvania
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Corey Sharp

Corey Sharp is the Lead Writer at PlayPennsylvania bringing you comprehensive coverage of sports betting and gambling in Pennsylvania. Corey is a 4-for-4 Philly sports fan and previously worked as a writer and editor for the Philadelphia Inquirer and NBC Sports Philadelphia.

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