Online gaming in NJ not a threat to Borgata: COO
Users of gaming sites operated by the Borgata in Atlantic City, N.J., have created more than 20,000 accounts to bet real money online in New Jersey, since the state's approval of Internet gambling in late November, the casino's chief operating officer told CNBC on Thursday.
Tom Ballance—who's also the president of Borgata Hotel Casino & Spa—said in a "Squawk Box" interview that online gaming in New Jersey has exceeded expectations.
"Borgata was uniquely positioned to be at the forefront, primarily because of efforts by our managing partner, Boyd Gaming Corporation. Boyd's strategy is to engage in online gaming nationwide," he explained. "We weren't out hunting for a service provider, when others were. We were all set up and ready to go."
Internet betting is not a threat to brick-and-mortar casinos, Ballance argued. "When we match up databases, the great majority of players who were playing online have not been to Borgata in well over a year. And the vast majority have made fewer than two trips in the past year. So it's a different customer."
There's also a different demographic for the online gambler, he contended. "It skews more male than the conventional brick-and-mortar customer."
Answering critics who say Internet gaming makes it too easy to bet since gamblers don't have to leave their homes, Ballance said: "Online we actually have more controls. ... You don't extend credit online. You've got to fund your account somehow ... through your checking account or through a credit card."
As a destination, Atlantic City has fallen on hard times because of what Ballance called "convenience gaming" in Pennsylvania and New York. "You have to provide a product and service that's worth driving 90 minutes for instead of 15 minutes."
The seaside gambling resort is also under pressure from Gov. Chris Christie, R-N.J. This is the fourth year of a five-year grace period that he's given the city to turn around its struggling fortunes before he considers expanding casinos to other parts of New Jersey, such as the Meadowlands Sports Complex in the northern part of the state.
But at the Borgata, Ballance said he's focused on continuing to grow the bottom line. "Our first 11 months of , which is all that we disclosed so far, is up from 2012. That's only the second time revenue has been up in the last seven years."
"We were up about 3 percent at the end of the 11 months," he added. "And that's really encouraging for us."