The US online poker industry is struggling. With only a few states operating online poker, mostly in separate player pools, choices for players remain limited and the prize pools are significantly smaller compared to the pre-Black Friday era. In this series, we look at the next steps we hope to see for the market to flourish.
In part one, we explored how WSOP and BetMGM could merge their New Jersey and Michigan player pools. We looked at the benefits and assessed how possible this change is will be next year.
In part two of our series on US online poker’s future, we shift our focus to the possibility of Pennsylvania joining hands with other states in the multi-state online poker agreement. We look at the necessary steps, who stands to gain, why it’s taking so long — and when it might happen.
- What It Is: Pennsylvania joining the Multi-State Internet Gaming Agreement (MSIGA)
- Why It Matters: To help flourish the US Online poker landscape, which is struggling due to lack of liquidity.
- Who Benefits: All stakeholders in the industry, including players, operators and the state.
- How Many States Are Part of It: Four
- Who Are the Current Members: Nevada, Delaware, New Jersey & Michigan
- Why PA Hasn’t Joined Yet: Likely attributed to the busy schedule of the new Pennsylvania Governor and competing priorities.
- Likelihood of It Happening in 2024: 2.5/5
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What Needs to Happen?
Pennsylvania needs to join the Multi-State Internet Gaming Agreement so operators can expand their US online poker apps.
Currently, online poker is legal in eight states, but of those it is live in just five and, of those, only four have taken the step of forming interstate online poker compacts: Nevada, Delaware, New Jersey & most recently Michigan. Pennsylvania, which legalized online poker nearly six years ago, has yet to take this crucial step.
The Pennsylvania Gaming Control Board (PGCB), responsible for overseeing online gaming in the state, has clarified that the authority to make this decision does not currently lie with them. Instead, the responsibility rests with the Governor’s office, which must grant approval for any multi-state contract.
Furthermore, the process of reviewing and approving such a contract would involve the Attorney General, and the PGCB would then play a role in facilitating the operational aspects.
Hence, before online poker operators in Pennsylvania can merge their player pool with other states, the state’s newly elected Governor, Josh Shapiro, must sign the multi-state contract.
| State | MSIGA Status? | WSOP/888 | BetMGM | PokerStars |
|---|---|---|---|---|
| New Jersey | Active | ✔️ | ✔️ | ✔️ |
| Nevada | Active | ✔️ | ❌ | ❌ |
| Delaware | Active | ✔️ | ❌ | ❌ |
| Michigan | Active | ✔️ | ✔️ | ✔️ |
| Pennsylvania | Pending | ✔️ | ✔️ | ✔️ |
Why Is it Important?
Pennsylvania joining hands with other states to allow for cross-border shared liquidity will mark a significant step forward for the US online poker industry, which has grappled with challenges in recent years primarily because of insufficient liquidity.
Particularly, the online poker market in Pennsylvania has shown a consistent decline year after year, underscoring the necessity for the state to engage in the interstate online poker compact. Year to date, operators have generated $23.5 million, the lowest during this period in market history. It is down almost 10% year-over-year and far below 2020, when the market first opened and had just one online poker operator.
Pennsylvania Online Poker: Q1-Q3, 2020-2023
| 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|
| PokerStars PA | $28,303,022 | $20,113,973 | $15,940,699 | $14,407,550 |
| BetMGM PA | - | $1,980,562 | $3,311,047 | $4,196,077 |
| WSOP PA | - | $1,664,406 | $6,748,536 | $4,942,441 |
| Total | $28,303,022 | $23,758,941 | $26,000,282 | $23,546,068 |
Shared liquidity, often referred to as cross-state or interstate online poker, holds paramount importance in the poker world. It means players from different states (or countries) can all play together, which makes tournaments bigger and cash games more exciting. Operators can also put on larger tournaments and offer more game options.
In simple terms, shared liquidity is critical to a healthy online poker ecosystem.
Pennsylvania, as the fifth-largest state in the US by population and the largest state with a regulated online poker market, stands to magnify the compact’s reach. It would benefit PA online poker industry, but also extend shared liquidity network would provide a significant boost to the industry as a whole.
Additionally, this move may trigger a domino effect, encouraging smaller states which have legalized online poker — like West Virginia, Connecticut, and Rhode Island — to take advantage of the multi-state online poker compact and launch online poker themselves. This would be unsustainable if they went alone.
| US State | Online Poker Launched | Joined Compact | Shared Player Pool Launch |
|---|---|---|---|
| Nevada | Apr 2013 | Feb 2014 | Mar 2015 |
| Delaware | Nov 2013 | Feb 2014 | Mar 2015 |
| New Jersey | Nov 2013 | Oct 2017 | May 2018 |
| Pennsylvania | Nov 2019 | - | - |
| Michigan | Jan 2021 | May 2022 | Jan 2023 |
| West Virginia | - | - | - |
| Connecticut | - | - | - |
| Rhode Island | - | - | - |
Who Benefits?
Pennsylvania joining the compact could bring significant benefits to all stakeholders.
- Players: As detailed in the first part of this series, allowing Pennsylvania players to compete across state lines would lead to a larger player pool, more variety of games, increased rewards, enticing promotions and increased competition.
- Operators: As for operators, bigger player pools will create more revenue, allowing them to enhance their offerings and create a more dynamic and rewarding poker environment. It will also enable them to venture into new markets, attract players from different states and thus target a broader audience.
- State: State tax revenues increase due to the presence of larger player pools and prizes benefit state regulators by providing a broader player base to monitor and tax.
- Industry: Pennsylvania’s entry into the agreement could create a nationwide ripple effect. Its approval might pave the way for other states to follow suit, potentially allowing smaller states to contribute players to the expanding pool. Operators not yet operating in the Keystone State, such as GGPoker PA and Run It Once Poker/BetRivers, could be enticed to launch if more states join the multi-state online poker compact.
Why Hasn’t It Happened Yet?
Poker enthusiasts in Pennsylvania have been pondering this question since Michigan joined MSIGA as its fourth member last year. Pennsylvania, being the largest regulated market in the US, has the legal framework to enter multi-state agreements.
The state regulator has shown support for the idea, with the previous administration under Governor Tom Wolf expressing interest on multiple occasions.
In April 2022, shortly after Michigan’s inclusion as the fourth state in the compact, a spokeswoman for Governor Wolf told Pennsylvania Gaming Review that the governor is closely monitoring the impact of recent online gaming expansion on the state’s gaming industry and residents. She also confirmed that Governor Wolf is actively engaged in reviewing the MSIGA agreement.
Despite this, the anticipated move has yet to materialize. Jeff Ifrah, a legal expert at Ifrah Law PLLC, in an interview with PA Gaming Review, speculated that the delay might be due to the challenge of getting this issue onto a busy governor’s agenda.
He also pointed out that the initiative primarily benefits a specific poker brand, WSOP, and that online poker is not a major revenue source for the state.
When Will It Happen?
PGCB spokesman told pokerfuse that 'there simply has been no movement to report’ on the matter.
The question on everyone’s mind remains: when will Pennsylvania finally become a member of the multi-state online poker compact? Predicting if and when this will happen is a challenging task.
The current administration, led by Governor Josh Shapiro, who assumed office in January of this year, has not publicly indicated whether he will sign the MSIGA agreement to bring Pennsylvania into the compact. Despite numerous attempts to seek a response from the governor or the regulatory authorities, no clear answer has emerged.
The governor’s office declined to comment on Shapiro’s stance regarding joining MSIGA, or even on whether he has been briefed about such a move. In July, PGCB spokesman Doug Harbach told pokerfuse that “there simply has been no movement to report” on the matter.
However, there is reason for optimism. Governor Shapiro is well-versed in igaming issues, particularly the federal Wire Act. He previously served as the state’s attorney general (AG). During his tenure as AG, Shapiro joined 25 other AGs in June 2021 in urging US Attorney General Merrick Garland to clarify the US Department of Justice’s (DOJ) stance on the Wire Act.
This request to clarify the Wire Act was significant, as the PGCB did not consider it to be a settled law, which had hindered Pennsylvania’s entry into MSIGA. However, in September 2022, the Wire Act confusion seemed to be resolved when Judge William Smith ruled in favor of the industry, unequivocally stating that the Wire Act applied solely to sports betting and not online poker.
In light of these developments, alongside Michigan’s successful entry into the pact and the fact that WSOP is no longer the sole operator benefiting from shared liquidity in the country, it appears increasingly likely that Pennsylvania will follow in the footsteps of the Great Lakes State.
Considering these factors, we estimate a 50/50 chance of Pennsylvania joining the compact by next year. By 2025, we anticipate this as a favorite.
Learn more about real money online poker in PA in our complete guide.
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