PokerStars plans to launch a Pennsylvania online gambling portal alongside partner Mount Airy Casino Resort in Mt. Pocono. PokerStars and Mount Airy Casino will partner on a site for online poker, casino games, and sports betting.

For the world’s most famous online cardroom, the deal is potentially more significant than PokerStars’ New Jersey gaming site. Stars Group and PokerStars have a partnership with Morris Bailey’s Resorts Casino Atlantic City on online casino and poker sites, which has been lucrative. PokerStars New Jersey is the top online cardroom in the Atlantic City interactive poker market.

Because Pennsylvania has a larger population than New Jersey, though, the PokerStars deal with Mount Airy Casino could prove to be more lucrative. Pennsylvania has over 12 million residents, making it the 5th most populous US state. By comparison, Australia has 24 million residents and Canada has 36 million residents, so the Pennsylvania gaming market alone is comparable to half Australia’s and one-third of Canada’s potential revenue.

Pennsylvania has a much higher tax rate, though, so PokerStars and its parent company, Stars Group, might still generate more profits from the New Jersey online gambling market.

Matt Premieux on PokerStars Pennsylvania

Matt Primeaux, SVP Strategy & Operations for the Stars Group (PokerStars’ parent company), said in a prepared statement after the deal was announced, “We’re excited to take this next step as The Stars Group looks to broaden its presence in the United States.”

Primeaux added, “In partnership with Mount Airy Casino Resort, we believe we’re well positioned to capitalize on opportunities in the Commonwealth by bringing our world leading offerings to Pennsylvania players.”

Mount Airy Online Casino

The partnership with PokerStars makes Mount Airy Casino one of the big players in the Pennsylvania online gaming market. Mount Airy is a smaller casino-resort in northeast Pennsylvania, near the border with New York.

Mt. Pocono is 25 miles from Philadelphia, so many of Mount Airy Casino’s visitors come from the Greater Philadelphia Metropolitan Area. The PokerStars signage and cross-promotion should give the world’s No. 1 poker site a good marketing base for the Philly-area card player community.

$10 Million Sportsbook Fee

At the moment, 9 land-based casinos in Pennsylvania have paid the $10 million licensing fee to launch online poker and casino sites. Companies still have time to apply for a sports betting license, which also will cost $10 million.

It is not certain all nine of the companies which bought online casino/poker licenses will invest in a sportsbook. Pennsylvania has a reputation for high taxes, as it generates more revenues from gaming taxes than any other state besides Nevada.

36% Tax Rate on Bookmaker Winnings

The tax rate for sports betting will be 36%, which is astronomical by bookmaker standards in the United States. For instance, Nevada sportsbooks have a bookmaker tax rate in the 10% to 11% range, but they balked at talk of a 1% integrity fee due to the margin on sports betting. They argue that anything over 15% makes it impossible to compete with unregulated sportsbooks and bookies, which naturally have no taxes.

Pennsylvania sportsbook operators therefore can expect no profits from their sports betting operations. What they can expect is to draw more gamblers to their site — whether it’s a brick-and-mortar sportsbook or a bookmaker site — who might then bet on other forms of gambling.

Sportsbooks Drive Customers to Casinos

Like NFL sports broadcasts themselves, which networks say they tend to lose money on (due to the multi-billion dollar contracts they pay), it is the draw that sports-related entertainment brings that pay off. With NFL broadcasts, networks advertise their newest shows and specials, which helps drive viewers to their other programming. With sports betting, sports fans go to the casino for a wager on an NFL game, then stay to place other wagers while they wait for the games.

The Pennsylvania Gaming Commission has not stated whether any of the 13 land-based casinos have applied for a sports betting application yet. PokerStars certainly wants to add an online sportsbook through its BetStars brand. Parx Casino, which is working with GAN on a comprehensive online gambling portal, also says it wants to have an online sportsbook.

About the Author
April Bergman avatar
April Bergman

April Bergman was a longtime news blogger for BOC. She wrote gaming news posts from January 2013 until September 2018. April also wrote slot reviews, strategy articles, and online casino reviews for the site.

April Bergman began in the online gaming industry in August 2010. From 2010 to 2013, she managed evergreen content for several top online casino. Her duties included developing and maintaining multiple websites in the gaming space. When not writing about online gambling, April loves horse racing, travel, photography, and gardening. She's began in the business as a devoted poker players and spent several years as a card game editor on the now-defunct DMOZ. These days, she lives with her husband and two children in the Toronto metropolitan area.

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April Bergman was a longtime news blogger for BOC. She wrote gaming news posts from January 2013 until September 2018. April also wrote slot reviews, strategy articles, and online casino reviews for the site.

April Bergman began in the online gaming industry in August 2010. From 2010 to 2013, she managed evergreen content for several top online casino. Her duties included developing and maintaining multiple websites in the gaming space. When not writing about online gambling, April loves horse racing, travel, photography, and gardening. She's began in the business as a devoted poker players and spent several years as a card game editor on the now-defunct DMOZ. These days, she lives with her husband and two children in the Toronto metropolitan area.

READ MORE
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