Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
A recent report on the evolving casino gaming market in the Northeast considered the impact of the recession on gaming revenues and the increasingly competitive gaming market, addressing issues of regional competition, market saturation, and inter-state cannibalization.
The “Northeastern Casino Gaming Update,” authored by Clyde Barrow of Pyramid Associates, highlights the competitive nature of the industry as new gaming facilities are discussed by neighboring states and as the Massachusetts Gaming Commission considers licensing a resort casino in Region C (southeastern Massachusetts).
The report notes that gambling revenue nationally is part of consumer discretionary spending, which is still recovering from the impacts of the 2007-2009 recession as the price of many consumer goods remains high. National commercial casino gaming revenue reached a peak in 2007 at $37.5 billion before declining during the recession and then recovering to $38.7 billion in 2014. While the industry may no longer be considered recession-proof, it is continuing to grow, according to the report.
As plans are made within the New England region for an increasing number of casinos, the issue of market saturation is frequently debated. The report contends that even in an over-saturated market, new gaming facilities can succeed if they are willing to accept lower profit margins. Existing gaming facilities in the region could be displaced by new facilities that offer more attractive features or locate in more strategic locations.
Market saturation is not a fixed point, the report notes. It can vary with consumer confidence about the economy, shifting consumer preferences, or population or income growth. Across the country, as more casinos have opened, consumers have become more likely to gamble, highlighting a clear link between propensity to gamble and supply and convenience.
The opening of casinos in Massachusetts is expected to drive down gaming revenue in neighboring states. In an effort to retain market share, Connecticut lawmakers in March proposed opening three new casinos near the border with Massachusetts. Connecticut is home to two of the largest casinos in the world, which generated an estimated $1.8 billion in revenue in 2014. According to the casino report, approximately $475 million of that revenue came from residents of Massachusetts.
As the Massachusetts Gaming Commission considered licensing a third and final commercial casino, the state’s sole licensed slots-parlor, Plainridge LLC in Plainville, announced an opening date of June 24.
Last year, the Gaming Commission awarded the Greater Boston (Region A) license to Wynn LLC in Everett and the western Massachusetts (Region B) license to MGM in Springfield. On March 24, MGM became the first to break ground on a resort casino in Massachusetts. The casinos in Springfield and Everett are expected to open in 2017 or 2018.