Introduction to Five Ways Nevada Leads World Gaming Industry
When thinking about gambling in the U.S., most people minds will gravitate towards the city of Las Vegas, with all its lights, glamour, and casinos. While much has changed with regards to the gaming industry in the last 10 years, with so many more casinos available closer to home for most people, yet Nevada’s gambling reputation remains true. Here, Professor Slots discusses the Five Ways Nevada Leads World Gaming Industry.
In fact, Nevada has led the gaming industry for decades. In this article, I will discuss the ways in which Nevada provides and maintains this leadership despite no longer being the epicenter in the U.S. for actual gambling itself.
Taking a step back for a moment, however, why is Nevada’s leadership role important to slots enthusiasts? It’s important because your state’s gaming regulations matter.
As mentioned elsewhere, for example, slots enthusiasts can take advantage of a state’s public reporting of actual payback returns to improve your baseline odds of winning.
If you want to know what direction your state’s gaming regulations might well be heading towards, in preparation of these changes, it is important you understand how Nevada’s example to other U.S. states constitutes a leadership role for other state legislatures and gaming board commissioners.
This article offers a summary of Nevada’s leadership role, and has the following sub-sections:
- How the U.S. Gaming Industry Expanded, Historically
- Perception is Reality – The Virtual World of Las Vegas
- Legalized Sports Betting: Nevada was First
- Nevada State Gaming Regulations
- Nevada and International Gaming Jurisdictions
Keep Reading … or Listen to my Episode on Nevada Gaming Industry Leadership!
How the U.S. Gaming Industry Expanded, Historically
Prior to May 26, 1978, the only legal casinos in the U.S. were those available in the state of Nevada. After this date, when Atlantic City’s first casino opened, U.S. casinos existed only in Atlantic City, New Jersey and within the state of Nevada.
This casino scarcity was maintained until the federal Indian Gaming Regulatory Act of 1988, quickly followed in 1989 by Iowa’s legalizing the first riverboat casinos via state law.
New state gaming regulations allowing casino gambling in other states occurred later that same year. This includes South Dakota legalizing gambling in Deadwood as well as Illinois and Indiana legalizing riverboat casinos, all during 1989.
The next decade saw this gaming industry expansion grow even faster, with Connecticut, Colorado, Illinois, Indiana, Louisiana, Mississippi, Missouri, and other states quickly legalizing casinos by the end of 1993.
Furthermore, gaming on cruise ships was addressed in 1991 while Michigan legalized gambling in the city of Detroit in 1996.
By 1994, 13 states had legalized casinos. With the exception of the state of Nevada and possibly New Jersey, to say that these states underwent a steep learning curve would be an understatement.
Luckily, the state gaming board commissioners from these states had an excellent example to follow: Nevada state gaming regulations.
For those interested in a more detailed history, see “A Chronology of (Legal) Gaming in the U.S.” by George Fenich, which documents U.S. gaming industry developments from gambling sailors on Columbus’s ships in 1492 up to the year the article was originally published in 1996.
By around the late 1990s, as you might expect, this tremendous and unprecedented gaming industry expansion had sputtered to a near halt. Why? Because all non-tribal casinos are regulated, and those regulations enforced, by state gaming laws – which had never been previously established in these states.
Because of its early adoption of gambling, only Nevada had the needed professional experience to both regulate and enforce state gaming regulations. This professionalism wasn’t just with regards to the state laws and the legislature that had enacted them.
There was also a large group of academics and attorneys who had, for many years, been challenging these gaming laws in court. This contributed significantly to an overall refinement of Nevada gaming laws as well as the development of a substantial amount of precedence with regards to case law.
As a result of this valuable, decades-long activity, a core of gaming industry specialists was available to help other states besides Nevada to generate comprehensive gaming regulations in other states.
Perception is Reality – The Virtual World of Las Vegas
An awful lot can and often is said about the gaming industry in Nevada. These dialogues and monologues include quite a few gambling blogs, podcasts, and social media channels devoted to all things Las Vegas.
These personalities and even celebrities appreciate Nevada’s leadership role with regards to the gaming industry as well as entertainment. After all, gambling and entertainment often go hand in hand.
But, for those people who have never traveled to Las Vegas, they often know about whatever portion of Las Vegas shows up in movies like Casino and Next as well as television shows like CSI: Crime Scene Investigations, Pawn Stars and various shows simply called Vegas or Las Vegas.
So, there is another aspect to Las Vegas, which is the perception of Las Vegas. While typically far less than accurate, the perception of gambling in Las Vegas matters because so many people believe in the glamour of the casino and gambling lifestyle based on what they have heard about Las Vegas from popular movies, television series, as well as other online sources like “what’s happening in Las Vegas” articles and podcasts.
Why this is important comes in once a casino opens within easy driving distance to individuals who have no real experience gambling, but think they do because it’s long been an integral part of some of their favorite television shows and movies.
However, when it comes time to actually enter a casino, several preconceived notions can get in the way. For example, they could consider casinos to be high crime areas. Or, that gamblers often win big without trying too hard. For these individuals, the perception of fictional shows has become a reality for them.
As a result, there can be a steep learning curve to understanding what a real casino environment is like, and well as understanding and practicing the necessary skills for thriving in a casino environment.
First they have to unlearn what they think they know, then they have learn it right. This is sometimes called retraining, and can be expensive in time, money, or both.
In my opinion, the worst circumstance is never entering a casino simply because fictional shows have taught someone to be afraid of them for reasons that don’t really exist.
Another circumstance, nearly as bad, I’ve already mentioned: Having serious misunderstandings about how casinos actually work. If you don’t understand how to “shop” at a specific business, many businesses have a sales representative that simply explains what they have to offer in terms of what you need.
For example, consider if you’ve gone to a pool store to buy a residential pool. The sales rep will explain the differences between above ground and below ground pools, as well as the immediate and long-term costs involved.
Now, have any of you had a similar conversation with a casino employee? Anyone? Anyone? Bueller? You can bet you haven’t!
My point here is that casinos are going to tell you anything except how to spend money. Those casino employees that regularly interact with casino patrons are reprimanded, and can even lose their jobs, if they suggest a gambler stop gambling, even under the worst circumstances of problem gambling.
My primary consideration here is, casinos don’t educate their patrons to gamble well. And, television and movies are not very realistic about the casino environment. All of this is less than useful, and at worst misinformation.
It’s your responsibility to educate yourself about your gambling habits. And, if you want to educate yourself, a great resource is your state’s gaming commission or the gaming commission of the state in which you gamble. And all of them, more or less, are based on Nevada’s state gaming regulations.
Legalized Sports Betting: Nevada was First
Nevada’s gaming industry leadership role can be clearly seen in the May 14, 2018 ruling from the U.S. Supreme Court, which ended the nearly nation-wide ban on sports betting. It was “nearly” a nation-wide ban because only Nevada legally allowed sports betting. As an interesting aside, the PASPA excluded the banning pari-mutuel wagering of horse and dog racing.
That’s right: Nevada was always fully exempt from the federal law from 1992, the Professional and Amateur Sports Protection Act of 1992 aka PASPA aka the Bradley Act, which had originally banned sports betting. Again, as seen in this 2018 news about this overturned law, Nevada’s leadership in the gaming industry is not at all new.
Officially, the PASPA of 1992 exempted sports lotteries in Oregon, Delaware, and Montana as well as licensed sports betting pools in Nevada. One component of the law provided a 1-year opportunity for states with licensed casino gaming to pass laws permitting sports wagering. This was meant to include New Jersey, despite their later failing to meet that deadline.
Just to be clear, the court ruling does not legalize sports betting. Instead, the U.S. Supreme Court basically said that the PASPA violated the 10th Article of the U.S. Constitution.
Their reasoning was that the federal PASPA illegally empowered the federal government to order states to disallow sports gambling. By this court ruling, only this specific application of that empowerment was successfully removed on May 14, 2018.
So now, as with most types of gambling in the U.S., sports gambling will need to be allowed by law in states that wish to legalize sports betting. And, changing state laws can sometimes take a while. Stay tuned to your state’s legislature to follow if and when legal sports betting is legally allowed in your state.
But, getting back to Nevada’s leadership role, this court ruling allows states to develop laws that legally allow sports betting. Only Nevada has had an operational sports betting system. Other states now have the opportunity to adapt their own sport betting laws based on Nevada’s successful application.
When I first began researching the gaming industry, I learned something about illegal gambling which completely astonished me. What surprised me was how common it was reported to be, along with how much money was involved.
Perhaps you’ll also be astounded to know that illegal gambling is a $150 billion per year industry. Rather, it’s $150 billion per year in the U.S. on illegal wagering of professional and amateur sports. From the perspective of states, which is highly relevant here, that’s a lot of tax revenue being lost.
Concerns about sports betting has been that it will lead to the “gamblification” or rather gamification of sports. This is found when fans become more focused on gambling than following a team.
Others, like trade groups that represent casinos, have predicted that the ruling would generate revenue without endangering the integrity of sports competitions.
Analysts also believe it’s also likely to be a boon for media companies, as allowing sports betting will likely benefit them due to fans becoming more deeply invested in sporting events, which in turn will result in higher ratings for these companies.
Whatever the case may be, Nevada’s practical and operational experience with decades of existing sports betting will be an important factor. As mentioned, it won’t just be the how-to aspect of running large sports betting pools, but also through providing an example of high quality legislation as well as subsequent case law.
Nevada State Gaming Regulations
Nevada is recognized as having world-class state gaming regulations. The 80+ year history of the Nevada Gaming Control Board has developed a robust gaming regulatory framework.
This development was only possible thanks to long standing contributions from both state policy makers as well as ongoing challenges to the Nevada system by those with new and innovative ideas.
Consequently, Nevada is used extensively by other gaming jurisdictions, both domestically and internationally, as an exemplary example of what works.
Most, if not all, of these gaming regulations and associated information can be found online at the joint website for Nevada Gaming Control Board and Nevada Gaming Commission. There, for example, can be found:
- Agendas & Dispositions;
- Statutes & Regulations;
- Licensee Information;
- Gaming Employee Registration;
- Tax Forms; and
- Statistics and Publications.
The breadth and depth of the board itself can be seen by the way it is organized. For example, it consists of the following six divisions:
- Administrative Division;
- Audit Division;
- Enforcement Division;
- Investigations Division;
- Tax & License Division; and
- Technology Division.
Also found, as a type of newsfeed timeline, are “Industry Notices & Technical Bulletins” as well as “Upcoming Events.” I especially found the “I Want To…” menu to be quite a good example of an assortment of useful information that can be found online at the Nevada Gaming Control Board and Nevada Gaming Commission site.
Sometimes detailed lists are the best way to provide a comprehensive view of what an agency such as this might provide. So, I am providing here that assortment of useful “I Want To…” topics:
- Submit Information about a Public Investigation;
- View Meetings, Agenda and Dispositions (Minutes);
- Find Forms and Applications;
- Access Gaming Statutes and Regulations;
- Access Pending Regulation Activity;
- Access Statistics and Publications;
- Access Industry Notices and Technical Bulletins;
- Apply for a Job;
- Apply for a Gaming License;
- Use the Online Gaming Employee Registration System;
- View License Fees and Tax Rate Schedule;
- Find Licensed Location/Licensee Information;
- View Orders, Stipulations, and Complaints;
- Find Frequently Asked Questions Regarding Interactive Gaming;
- File an Interactive (Online) Gaming Complaint;
- Request Waiver of Appearance;
- File a Public Records Request;
- Learn about the Restricted Licensee Compliance Seminars;
- Find Info About Club Venue Regulations;
- Learn About the Employee Registration Process & Compliance Training; and
- View Registered Hosts.
This list alone shows the transparency and thoroughness of the Nevada Gaming Control Board. Need a form? Here you go. Want to submit information about a public investigation? That’s here, too. How about compliance training? Yes, it has that! What about a variety of gaming legislation references? Yes, indeed, those are there are well.
Without putting too fine of a point on it, the Nevada Gaming Control Board and Nevada Gaming Commission has a comprehensive depth and breadth of information available for both their own needs as well as other gaming jurisdictions within the U.S. as well as the world.
Nevada and International Gaming Jurisdictions
As mentioned in my state-by-state blog series about this U.S. state, specifically Nevada Slot Machine Casino Gambling, Nevada’s regulatory framework has developed a reputation around the globe as the leader through its 80-year history and long-standing contributions.
These contributions have been provided by legislative and government leaders, gaming commissioners, board members and dedicated employees. This reputation was further enhanced by the contributions of gaming lawyers, accountants, advisors, and members of the academic community who have challenged the system with continued new ideas.
At the end of 2011, for example, Nevada was the first U.S. state to have gaming regulations in place for Internet poker play. This was done despite online poker play being against U.S. law. This was indicative of Nevada gearing up for if and when federal lawmakers approve legislation removing these barriers.
In the leading up to these new regulations from 2011, Nevada received attention for its leadership role for doing so, with one gambling conference in Las Vegas referring to Nevada as “the gold standard of gaming regulation.”
Nevada gaming regulators, such as former chairman Dennis Neilander of the Nevada State Gaming Board, discuss with news reporters about regularly talking with government officials from around the world that look to Nevada for guidance.
In his own words, Neilander has said, “It’s usually an exchange of ideas,” Neilander said. “They’ll ask about the structure of the agency or about best practices. How the industry is regulated differs around the world. Some things that work well in Nevada may not work as well in Singapore, Australia or Canada or among the various states.”
Neilander continued this interview with the Las Vegas Sun in the 2011 article “Is Nevada still the national leader in gaming regulation?” by stating such conversations started with him saying, “Here’s what works for us in Nevada. It may not work exactly like that for you or you may need to modify it, but it’s served us well.” Or, “Here’s what hasn’t worked for us.”
For those interested in more about the history of Nevada’s gaining its international gaming industry reputation, the aforementioned article discusses how this reputation was gained in part due to most others with gaming experience running casinos being members of organized crime. It is an excellent article, again, if you are interested in this aspect of gaming industry history.
Summary of Five Ways Nevada Leads World Gaming Industry
In summary, much has changed with regards to the gaming industry in the last 10 years, with so many more casinos available closer to home for most people. One important aspect that has not changed is the Five Ways Nevada Leads World Gaming Industry.
In fact, Nevada has led the gaming industry for decades. In this article, I have discussed ways in which Nevada provides and maintains this leadership despite no longer being the epicenter in the U.S. for actual gambling itself.
This loss of being the gaming industry epicenter can be seen by either state gaming revenue totals or simply by counting the number of casinos in Nevada and the U.S. as a whole this year and from a decade ago.
The total number of casinos in Nevada is far exceeded by the number of casinos in the U.S. due to the growth of casinos in so many other U.S. states in, say, the last 10 years.
There are currently approximately 965 casinos in the U.S. while Nevada only has 165 such casinos. This total does not include thousands of truck stops, bars and taverns in those states that allow licensed small businesses to have a few of gaming machines. So, in 2018, Nevada had about 17% of the casinos in the U.S.
Reviewing the 2008 Edition of the American Casino Guide, published 10 years ago, shows that at that time Nevada had 179 casinos and the whole of the U.S. had only 634 casinos. So, back in 2008, Nevada had 28% of all casinos in the U.S.
Therefore, from 2008 to 2018, Nevada had an 11% drop in its market share in terms of total number of casinos in the U.S. Despite this loss, Nevada is still considered the leader of the gaming industry worldwide simply due to its ongoing contribution, expertise, and experience.
Taking a step back for a moment, however, why is Nevada’s leadership role important to slots enthusiasts? Put another way, why did I write this article for my audience of slots enthusiasts?
Nevada’s leadership role is important to you because your state’s gaming regulations matter. As mentioned elsewhere, for example, slots enthusiasts can take advantage of a state’s public reporting of actual payback returns to improve your baseline odds of winning.
Furthermore, the gaming industry in the U.S., and indeed the world, is a dynamic environment. Frankly, there is a lot going on. Wherever you are, whatever gaming jurisdiction you are located in either domestic or internationally, change is coming.
And, if you want to know what direction your state’s gaming regulations might well be heading towards, in preparation of these changes, it is important you understand how and why Nevada’s example constitutes a leadership role for other gaming regulators.
Knowing more about Nevada’s supreme gaming regulatory framework will help to prepare you for those coming changes. And, hopefully, allow you to continue the level of slots play you are accustomed to, or allow you to improve on it.
As a final note regarding the relatively high reputation of Nevada’s gaming regulatory framework, it has been reported in a Las Vegas Sun article that “Some gaming jurisdictions have even contemplated approving licensees automatically if they’ve made it through a Nevada licensing investigation.”
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