David Cordish, chairman and CEO of the Cordish Companies, perked up the audience of the East Coast Gaming Congress with an old-school throwdown about iGaming and physical casinos.
He even quickly invoked the memory of his late friend in gambling, Sheldon Adelson, leader of the Las Vegas Sands Corporation, who adamantly opposed online gambling.
“I’m skeptical,” said Cordish about iGaming, at the beginning of his 20-minute speech.
Cordish says “no one is making money” on iGaming
He quickly added he does not feel the same way about online sports betting. He sees sports betting apps as a positive for driving growth in physical casinos, Cordish’s heaviest investment. The 81-year-old third-generation leader of the Baltimore-based development company had just spent two days at his Live! Philadelphia Casino before coming to the Atlantic City conference.
Cordish said online casinos lack the social aspects of visiting a casino or even of online betting on sports. People who wager on sports betting apps become cross-over customers who come to retail sportsbooks, in his view, bolstered by research.
“iGaming is expensive. No one is making any money,” because of the cost of acquiring customers, said Cordish.
“iGaming lacks a social aspect,” he said, meaning it does not easily add to play in physical casinos.
On the other hand, Cordish commented, online sports betting is “the point of the spear” for attracting new customers and converting them to loyal casino customers.
“Brick-and-mortar have to very be careful how far we take iGaming,” cautioned Cordish.
Cordish “thoughtful and provocative”
Michael Pollock, whose company Spectrum Gaming Group has for 24 years hosted the Atlantic City-based gaming conference, later called Cordish’s comments “thoughtful and provocative.”
Pollock said states “should take David’s comments into consideration as they weigh what gambling options to offer.” Spectrum consults with governments and gaming companies.
But iGaming works only with linkage and a robust database, he added.
“Absent linkage, they won’t capture the full benefit of iGaming,” Pollock continued.
“There is a wide opportunity to translate them into revenue streams. It is not an either/or situation. States will make their own decisions,” said Pollock on when they are properly marketed together.
Competing against Amazon not a fair fight
Cordish made it clear he believes he can strongly compete when it comes to brick-and-mortar casinos. But that it may not apply to online casinos, where a colossal database overwhelms building a social customer experience.
“There is a limited universe in brick-and-mortar casinos,” he said, while the internet means an infinite field of competition.
He added that the taxes brick-and-mortar casinos pay means casinos “make friends by paying taxes” in their host locations.
Cordish coupled his reluctance about online casinos with the likelihood of tech giants eventually becoming competitors for online gambling dollars.
Tech giants such as Amazon, with its vast database “in the ether,” as opposed to anchored and operating in brick-and-mortar gambling operations, would not be a fair fight, Cordish’s view.
Gambling ads cause alarm
Chris Rogers, the chief strategy officer for Penn National Gaming, warned that the online gambling market must be better about self-regulating advertising in another portion of the conference. Otherwise, he said the US could soon face the imposition of restrictions that have swept like a tidal wave over European betting markets.
Bill Miller, the president and CEO of the American Gaming Association, gave an upbeat keynote address, beginning by saying the in-person meeting “beats the hell out of a Zoom call.”
He said the industry is “roaring back” from COVID-19 restrictions and is on a “record pace to beat 2019, the best year on record.” Miller added technology will soon replace cash at most casinos, leaving cash transactions to “flea markets and garage sales.”
But Miller, too, sounded a note of caution when it comes to sports betting. He cited over expansion and a “saturation” of advertising in that segment.
“We know what sports betting looks like when it goes wrong,” he said.
Miller cautioned that “building sustainability” should be the aim in the sports betting segment. He also told the audience they must focus attention on the unlicensed grey market of gambling machines.
“We need everyone to work on this,” he said.
Lead image: David Cordish in 2012/Brian Witte AP