Is MGM, seven years after being approved for online poker in Nevada, finally eyeing a poker site in the Silver State? A new development this week could signal that it’s on the horizon.
MGM’s partner for nationwide sports betting expansion, GVC Holdings, had a hearing in front of the Nevada Gaming Control Board on Thursday. The company received preliminary approval for licensure, with another hearing slated for later this month. GVC, owner of the resurgent partypoker brand, is an MGM online gambling partner in New Jersey.
While sports betting is the focus of the MGM-GVC relationship thanks to the ongoing sports betting boom, the application in the Silver State also seeks approval for interactive gaming, which in Nevada means online poker. Nevada online poker is currently limited to a platform from Caesars Interactive Entertainment, owner of the World Series of Poker.
The GVC/MGM Nevada licensing application includes a request for interactive gaming. In Nevada, that is defined as online poker and isn't sports/race related. It seems easy to conclude that GVC/MGM hope to launch Partypoker in Nevada. Partypoker currently operates in NJ. pic.twitter.com/kySTOE68Wp
— John Mehaffey (@John_Mehaffey) May 9, 2019
Bwin.Party, which GVC acquired in 2016, sought Nevada online poker licensure in 2012 through a relationship with MGM, but it never ended up launching a product.
Implications for U.S. online poker
Nevada’s online poker market is relatively miniscule, thanks to a small population and the lackluster traffic on the WSOP/888’s NV-NJ-DE network. CIE is the only online poker operator in the country able to enjoy liquidity sharing between states, which is crucial for a platform.
It’s unlikely that MGM would launch a ring-fenced real-money NV online poker site in the near-term, but the regulatory development this week could indicate that the casino juggernaut has big plans for poker in the future. MGM, along with Caesars, is eyeing online casino, including poker, in the Pennsylvania market, slated to kick off in mid-July. Between NV, NJ, DE, and PA, there are about 26 mm people exposed to regulated online poker. That’s still not a large player pool, but it’s major progress.
Throw in Michigan, where MGM has the state’s top casino, and that would grow to 36 mm people. Michigan is expected to legalize online poker later this year. MGM has also lobbied for online poker in New York State, home to nearly 20 mm people. NYS has its hands full with online/mobile sports betting discussions right now, but online poker legalization there could be on the horizon as well.
West Virginia legalized online casino, including poker, this year, but MGM doesn’t have a foothold there.
Thanks to the federal government’s Wire Act opinion in January, additional liquidity sharing for online poker is in doubt. The Wire Act opinion, a reversal from a 2011 memo, calls into question the legality of any form of interstate online gambling. The matter is playing out in the courts right now.
MGM bullish on favorable Wire Act resolution?
MGM has been critical of the DOJ’s Wire Act opinion, which goes against states’ rights, and the casino operator would like nothing more than to dispel the pesky 1961 Wire Act once and for all. Doing so would pave the way for a slew of states to set up liquidity sharing for internet poker games.
GVC and MGM announced a 50-50 joint venture for online gambling in July 2018, just a couple of months after the U.S. Supreme Court ruling that struck down the federal sports betting ban. That ruling also paves the way for states to pursue online gambling, as sports betting over the internet is what customers demand, thanks to the popularity of offshore, black-market gambling sites.
“The new venture will have exclusive access to all U.S. land-based and online sports betting, online real money and free-to-play casino gaming, major tournament and online poker, and other similar future interactive businesses — facilitating entry into multiple digital gaming verticals under the playMGM and partypoker headline brands,” stated a presser on the joint venture.