You Think You Know the Gambling Business?

istock_000004631335largeGambling in America has spread from onetime local monopolies in Las Vegas and Atlantic City, N.J., to nearly every corner of the country. Place your bets on how much you know about gambling with this quiz:


Which country produces the most overall gambling revenue (including casinos, legal online gambling and lottery tickets)?

A. China (including Macau)
B. Japan
C. Italy
D. U.S.

Answer: D.  While Macau is by far the world’s single largest casino market, the U.S. comprises many casino markets, as well as other forms of gambling such as lotteries. The total spent on gambling overall in the U.S. was $104.1 billion in 2015, compared with $58.6 billion in China, including Macau. Source: Global Betting and Gaming Consultants

Approximately how much annual revenue do lotteries generate for
state governments?
A. $500 mill
B. $1 bill
C. $20 bill
D. $50 bill

Answer: C.  Lotteries generated $18.2 billion in revenue for states in fiscal 2015, or 66% of total gambling revenue for states. Commercial casinos and “racinos” (casinos at race tracks) generated $8.7 billion for states, or 31% of gambling revenue. Source: Rockefeller Institute

How big is the Indian casino industry compared with commercial casinos in the U.S. by revenue?
A. ¼ the size
B. ½ as big
C. ¾ the size
D. twice as large

Answer: C.  Indian casinos generated $29.34 billion in gambling revenues in 459 casinos in 28 states in 2015, compared with revenue of $38.32 billion generated in commercial casinos. Source: Rubin Brown

True or false: After experiencing a deep dive during the latest recession, the U.S. casino market is growing to new highs as people start to gamble heavily again.

Answer: False.  Revenue from commercial casinos has generally been flat or has risen only slightly each year since 2010. (Indian casino revenue has grown overall, but some markets have seen declining revenue in recent years.) Despite modest growth as more states loosened gambling restrictions, many experts believe some markets have hit or are nearing the saturation point. In the states that already had commercial casinos in 2007, casino revenue has declined 6.1% since then to $35.1 billion. Source: Rockefeller Institute, Rubin Brown

Outside of Nevada, what state has the most casino gambling?
A. California
B. New Jersey
C. Pennsylvania
D. Illinois

Answer: A.  California casinos owned by Indian tribes generated around $7 billion in revenue in 2015. Among commercial casinos, Pennsylvania led with $3.2 billion in revenue. Pennsylvania opened its first casino just 10 years ago. Yet it has rapidly developed into the largest commercial casino market outside of Nevada, even surpassing the struggling East Coast gambling hub of Atlantic City. Source: Indian Gaming Industry Report, Rubin Brown

What year did visits to the Las Vegas Strip tourism corridor reach their highest levels ever?
A. 2004
B. 2007
C. 2013
D. 2015

Answer: D.  Tourism to Las Vegas declined during the recession but has increased nearly every year since 2010 to a new high last year. Source: Deutsche Bank

What year did gambling revenue peak on the Las Vegas Strip tourism corridor?
A. 2004
B. 2007
C. 2013
D. 2015

Answer: B.  While more people come to Las Vegas every year, visitors don’t spend as much on gambling as a percentage of their overall spending as visitors did in the past. Gambling revenue in Las Vegas still hasn’t recovered to its prerecession high of $6.8 billion in 2007. The recent amount of gambling spending per visitor in Las Vegas is 15% below those peak levels. Source: Deutsche Bank

Of the following casino games, which declined the most in the past two years in Nevada through July 2016?
A. Keno
B. Poker
C. Roulette
D. Baccarat

Answer: D.  After years of increasing, baccarat revenue has declined 23% in Nevada in the past two years. That indicates in particular the decline in high-stakes play from Chinese visitors amid a crackdown on corruption in China, which has also led to declines in VIP gambling in Macau. Source: Nevada Gaming Control Board

True or False: Half the revenue at Las Vegas casinos comes from gambling.

Answer: False.  In 2015, 35% of revenue from Las Vegas Strip casinos was generated from gambling. That number has been in decline for decades, as Las Vegas casinos have become increasingly reliant on hotel rooms, food, nightclubs and entertainment for revenue. In 1984, gambling’s share of Vegas casino revenue was nearly 59%. Source: UNLV Center for Gaming Research

Just three states—New Jersey, Delaware and Nevada—have legalized online gambling. About how many people in the U.S. gamble online?
A. $500,000
B. 1 million
C. 10 million
D. 50 million

Answer: C.  An estimated 10.8 million people gambled online in 2015, primarily on offshore unregulated and unauthorized websites. Online gambling in the U.S. accounted for $6.8 billion in revenue, much of that in offshore sports books. Legal online gambling in the U.S. produced around $160 million in revenue last year. Source: Global Betting and Gaming Consultants, Rubin Brown

About what percentage of gambling revenue for casinos do slot machines provide?

A. 25%
B. 50%
C. 75%
D. 90%

Answer: C.  With 77% of casino revenue nationally, slot machines are far and away the most important source of revenue for casinos. However, they have been declining in some key jurisdictions as younger people have shied away from slot gambling. Slot-machine revenue in Nevada has fallen 16% since 2007, compared with a 3% decline for table games. Sources: Rubin Brown, Nevada Gaming Control Board

Approximately how many people played daily fantasy sports for money last year?
A. 4 million
B. 15 million
C. 27 million
D. 52 million

Answer: A.  Daily fantasy sports sites DraftKings and FanDuel spent more than $500 million on advertising last year, saturating television sports and radio with their brands. The sites’ user base jumped, but is still relatively limited. Around 3.8 million people played daily fantasy sports for money in 2015. Heavy users—1% of those people—accounted for 60% of entry fees for the sites. Source: Eilers & Krejcik Gaming

About how many Americans are estimated to be gambling addicts (considered pathological or problem gamblers)?
A. 2 million
B. 5 million
C. 10 million
D. 15 million

Answer: B.  Around 2.5 million people are estimated to be pathological gamblers, with an additional 3 million estimated to be problem gamblers and 15 million at risk for problem gambling. Source: Rockefeller Institute

Which of the following states have no form of legal gambling?
A. South Carolina
B. Nebraska
C. Idaho
D. Hawaii
E. Georgia
F. Wyoming
G. North Dakota
H. Virginia
I. Utah

Answer: D and I.  Hawaii and Utah are the only states with no legal commercial or Indian casinos, lotteries or other forms of gambling.

Which state is the most heavily reliant on gambling revenue (including lotteries) for state coffers on a per capita basis?

A. Nevada
B. West Virginia
C. Rhode Island
D. Pennsylvania

Answer: C.  Rhode Island collects $457.20 per resident from gambling, surpassing even Nevada in its dependence on gambling on a per capita basis. With high tax rates for gambling and big lottery operations, New York collects the most money overall from gambling to fund its government ($3.2 billion). Pennsylvania is second ($2.4 billion). Source: Rockefeller Institute



The original article “You Think You Know the Gambling Business?” was written by Alexandra Berzon and published on September 19, 2016 by The Wall Street Journal.

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