Like virtually every industry on Earth, the real-money gaming sector has proven not to be immune to the digital revolution. While once upon a time poker playing was controlled by a few major companies and strictly limited to certain geographic constraints, the digitization of everything has turned that on its head.
Today gamers can play poker, roulette, blackjack, pai-gow poker, baccarat and just about every other game you can think of online, via their phone, tablet, or laptop, without any constraints over when and where they play. Predictably, the online casino industry has exploded, with thousands of different operators pulling in close to $50 billion in revenue.
The astonishing pace of the development of online casino gaming has led to countless pundits predicting the end of land-based casinos as we know it, as the poker players of the world move en masse to digital platforms. But is this really the case? Let's take a look at the current shape of the overall casino industry to see if the future really is bleak for land-based casinos.
When online casino gaming really took off around a decade ago, things did look bleak for the land-based industry. Revenues in gamblings meccas such as Las Vegas and Atlantic City plummeted, with major online platforms taking an ever-increasing share of gaming revenue. A number of massive casinos around the world went bust and shuttered their doors, prompting many to speculate that the physical casino would soon be a thing of the past.
However, in a development that has surprised industry watchers as much as anyone else in recent years, the decline of land-based casino operators seems to have reversed. Revenues are back up again, with land-based operators in Las Vegas, for instance, reporting an uptick in revenues this year for the first time in almost a decade.
This development can be partly explained by the adaptability of the industry. Rather than shunning digital technology, the companies that have come out on top have embraced it. Take the New Zealand-based gaming giant Sky City, which owns some of the biggest land-based venues in the country. To much fanfare, they recently decided to take on the competition with their own digital offering, dubbed Sky City Online Casino, which provides live casino gaming, e-payment, thousands of slots, and all of the other technological mod-cons one would expect. In many ways, land-based casinos are financing their survival by opening digital chapters. However, this isn't the whole story.
If land-based casinos were simply enjoyed inflated revenues again, it would be easy to attribute this to their embracing of digital platforms alone. However, that doesn't explain why, around the world, new casinos are once again being built at an astonishing rate, everywhere from Boston, to London, to Belize.
The explanation for this is that, with the rise of the so-called "experience economy", in which millennial consumers place more value in experiences than in material things, the glitz and glamor of the land-based casino is back in vogue. Major tourist destinations are proving to be the hotspots for new casino builds, in part because the excitement, luxury, and atmosphere of the casino floor simply cannot be replicated on an iPhone.
While other industries are still struggling from the effects of digitization, the gambling sector seems to be in buoyant shape. A combination of adaptation to new technologies and emphasizing the best elements of old-school casino gaming is allowing casinos to flourish.