Casino shutdowns in Atlantic City highlight the peril of gambling saturation

IN THE BEGINNING, there was Las Vegas. A rib was taken from the side of Las Vegas, which became Atlantic City. Las Vegas and Atlantic City begat Tunica and Riverboats and Indian Casinos and Pennsylvania and on and on and on. Soon people (mostly gambling experts, analysts, and business owners) began wondering when all this begetting would start to cause problems with saturation in the gambling industry. We now know.

According to the Associated Press, Atlantic City, which started 2014 with 12 casinos, may be down to 9 casinos by the end of 2014. The Atlantic Club has already closed, Revel says that it will close unless another company purchases it, and Caesars Entertainment says that it plans to close down the Showboat Casino at the end of this August.
A look at the map of the Mid-Atlantic region helps to explain the woes of Atlantic City. New Jersey is surrounded by New York, Delaware, and Pennsylvania. Delaware has long had casino gambling, New York is adding it, and Pennsylvania has become the 600 pound gorilla of casino gambling in the east, second only to the 800 pound gorilla of Nevada. Maryland and Connecticut are also nearby, adding to the competition.

Although the ongoing expansion of casino gaming continues, and it is difficult to determine where and when saturation will occur, we now have a clear example that saturation can and will occur when there are too many gambling opportunities with too few gamblers.

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