It was two years ago today that Ontario launched a bold experiment in legal sports betting and online casino gambling.
Bold for Canada, anyway, as on April 4, 2022, Ontario became the first province to allow an army of private-sector iGaming operators to legally launch and accept wagers from residents. That followed federal lawmakers decriminalizing single-game wagering in Canada in 2021, unlocking a ton of new betting markets for legal bookmakers.
Before April 2022, the government-owned Ontario Lottery and Gaming Corp. (OLG) was the only entity legally offering online gambling in Canada’s most populous province. Now, though, there are nearly 50 operators and more than 70 sports betting, casino, and poker sites taking action with the blessing and under the regulation of local authorities.
Ontario’s first safe, legal & competitive online gaming market was launched one year ago today! 👏 pic.twitter.com/xnlau5yJLU
— Ministry of the Attorney General (@ONAttorneyGen) April 4, 2023
Billions have been wagered with Ontario’s new iGaming operators, earning the government additional revenue and turning the province into one of the biggest legal markets for online gambling in North America. Just how big, though? Two years after the launch of Ontario’s competitive iGaming market, how does it compare to others?
Research firm Vixio GamblingCompliance estimated in November Ontario was the sixth-largest online gambling market in the world by regulated gross gaming revenue, trailing only the United Kingdom, Italy, Australia, Pennsylvania, and New Jersey in the first half of 2023. All told, Vixio projected Ontario's total online gross gaming revenue hit US$1.28 billion during the first six months of 2023, helping it jump ahead of several countries and states in the rankings.
Still, within Canada, there’s essentially no comparison, because no other province allows what Ontario permits (although Alberta is thinking it over). Instead, those jurisdictions have, for the most part, allowed government-owned entities to retain their legal monopolies there. No other province is providing the same level of disclosure about wagering activities as Ontario is either.
So what about south of the border? Thirty-eight states now offer some form of legal sports betting and seven have authorized online casino gambling as well. How does Ontario compare to those states by handle and revenue? Covers took a look at the numbers to put Ontario’s iGaming market into context.
Warning! Numbers ahead
In the first year of Ontario's competitive iGaming market, $35.5 billion was wagered (in Canadian currency) at private sports betting, casino, and poker sites, not including free bets and other bonuses. Approximately $1.4 billion in total gaming revenue was also generated by private operators in Ontario from April 4, 2022, to March 31, 2023, around 20% of which was kept by the province.
Those numbers are according to iGaming Ontario, the government agency through which operators can conduct their business in the province. And while iGO did not break down how much of its handle for the first year was attributable to private-sector sports betting, casinos, and poker, it does now.
Most recently, from Oct. 1, 2023, to Dec. 31, 2023, iGO reported there was $17.2 billion in total wagering in Ontario's competitive iGaming market and $658 million in total revenue generated. iGO's figures for the fourth quarter of 2023 (which is technically the province's fiscal third quarter) showed that online casino gambling accounted for $13.7 billion of all wagering, while sports and event betting amounted to $3.1 billion and peer-to-peer poker $431 million. iCasino was also responsible for the bulk of revenue during the quarter, with $471 million, followed by sports and event betting at $171 million and poker at $17 million.
iGO did not disclose monthly totals, just for the whole quarter. However, simple math suggests Ontario’s iGaming market saw an average of approximately $4.6 billion in online casino wagering, $1.03 billion in sports and event betting, and $143.7 million in poker play per month in the final quarter of 2023. Revenue would average $157 million from online casinos per month, $57 million from sports betting, and $5.7 million from poker.
Converted into U.S. currency, those monthly totals are approximately US$3.4 billion in online casino gambling (as of Wednesday, per the Bank of Canada's currency converter), US$760 million in sports betting, and US$106 million in poker play. For revenue, it would be US$116 million from online casinos, US$42.1 million from sports betting, and US$4.2 million from poker.
By the books
Nevada, the ancestral home of legal sports betting in the U.S., reported US$815.7 million in sportsbook handle for October, US$921.2 million for November, and US$843 million for December, according to data compiled by Vixio GamblingCompliance.
(I'm going to stick to handle when discussing sports betting, not revenue, or this article is going to run even longer.)
The numbers put Ontario slightly behind the Silver State in sports wagering per month, but Nevada, home to several famous brick-and-mortar casinos, does not allow iCasino play, which means Ontario is probably generating more online gambling action overall.
Nevertheless, New York, the largest competitive market for online sports betting in the U.S., reported more than US$2 billion in handle for the last three months of 2023, dwarfing Ontario's average.
Illinois, which is close to Ontario in population size, saw more than US$1 billion in sportsbook handle in October, November, and December. And Ohio, another similarly-sized state to Ontario, which only launched legal sports betting in 2023, saw US$747.7 million, US$865.5 million, and US$831.1 million in sports wagering, respectively, in the last three months of 2023. In other words, those three states are beating Ontario in online sportsbook handle almost every month.
Adding iGaming to the equation
But New York, Illinois, and Ohio have not legalized online casino gambling, much to the chagrin of operators there.
New Jersey, another historical gambling hub, does have both legal online casino gambling and sports betting. So while New Jersey’s population of around 9.3 million people is smaller than that of Ontario, which boasts more than 15 million residents, the Garden State’s online gambling industry could offer a closer comparison.
Sportsbooks in New Jersey accepted almost US$1.3 billion in wagers during October, US$1.6 billion in November, and US$1.3 billion in December, blowing past Ontario’s monthly average. New Jersey also reported US$166.8 million in gross gaming revenue from iGaming (poker included) during October, US$171.6 million during November, and US$180.3 million during December, all of which topped Ontario’s monthly average. New Jersey does not disclose online casino handle, just win.
More comparable comparables
Yet New Jersey is also one of the more mature markets for online gambling, as iCasino has been authorized there since 2013, and sports betting since 2018. How does Ontario compare to other iGaming jurisdictions in the U.S.?
Six other states offer both iCasino and online sports betting, but only two have both competitive markets and populations within arm's length of that of Ontario: Michigan and Pennsylvania.
Michigan reported US$551.1 million in sportsbook handle for October, US$584.1 million for November, and US$613.4 million for December, all of which are lower than Ontario’s monthly average of around US$760 million. However, Michigan also reported US$160.3 million in iCasino revenue for October (poker included), US$175.3 million for November, and US$181.4 million for December, all of which beat Ontario's monthly average of US$120.2 million (again, poker included). The state does not report iCasino handle.
Pennsylvania, meanwhile, reported US$829 million in sports betting for October, US$934.1 million for November, and US$925.6 million for December, surpassing Ontario's average for all three months. Online casino gaming in Pennsylvania also generated US$154.8 million in revenue for October, US$158 million for November, and US$165.1 million for December, which, again, all beat Ontario's average.
What's more, Pennsylvania reports handle for internet casino gaming. For the last three months of 2023, residents of the Keystone State wagered US$17.3 billion via online slots and table games, far more than the $13.7 billion (CAD) staked in Ontario's iGaming market over the same period.
So, when you look at those numbers, Ontario’s competitive iGaming market is lagging behind those in comparable U.S. states, which, granted, are more mature markets for legal online casino gambling.
But that's not all...
There is, however, a twist.
Most of the numbers above do not include the online gambling business of Ontario’s OLG, which is substantial. The provincial lottery and gaming operator (which has been around for decades) most recently reported $561 million (Canadian) in revenue from digital gaming for its 2022-23 fiscal year, which ended March 31, 2023, an increase from $427 million for the year before. That includes the company’s online casino, sports betting, and lottery offerings, but OLG does not disclose monthly figures or break down which gambling business is responsible for how much revenue.
On average, though, and going off the relatively older figures, Ontario could be realizing around $47 million (CAD) in additional online gambling revenue every month when you include OLG’s contribution. That is almost another US$35 million in gaming revenue to factor into the equation, although we don’t know how much of that is online casino play and how much is from sports betting.
Ontario Emerges as One of North America’s Largest iGaming Markets in First Year. Please see our full press release here: https://t.co/7iDSWz9jqE#PlayWithConfidence pic.twitter.com/8rULPx9IMU
— iGaming Ontario (@iGamingOntario) April 4, 2023
In other words, the combined efforts of OLG, iGO, and Ontario’s army of online gambling operators probably put the province at least closer to the sports betting and iGaming figures put up by New Jersey and Pennsylvania.
iGO, notably, said Thursday that Ontario's overall online sports betting market "ranks in the Top 5 in total wagers in North America" with OLG estimates included.
Moreover, according to Vixio, Ontario has already surpassed Michigan in online gambling revenue. The province is also outdoing what other smaller and medium-sized states are reporting, such as Arizona, Tennessee, and Virginia, on a sports betting-only basis. If you include iCasino, the gap widens further.
Something else to consider is all of the major online sportsbook and casino operators are present in the U.S. iGaming states, and they are present as well in Ontario. PointsBet, which sold its U.S. business to Fanatics, even maintains a presence in Ontario despite mostly vacating the North American market. It sounds like the operator plans to stick around, too.
“In the past two years, we have experienced remarkable growth and evolution, deepening our engagement with the vibrant sports community across Ontario,” PointsBet Canada CEO Scott Vanderwel said in a statement marking the province's iGaming anniversary. “Looking ahead, PointsBet remains dedicated to pushing the boundaries of innovation, enhancing the customer experience, and contributing to the continued growth and success of iGaming in Ontario, underscored by our dedication to responsible gambling to promote a healthy and sustainable ecosystem.”
To summarize: Ontario may not be the biggest market for online gambling in North America, but it is significant, bigger than some may realize, and growing. The same might be said someday for Canada as a whole, if other provinces ever follow Ontario’s example.
