It took a pandemic to shake-up legacy gambling brand MGM.
After nearly 1,000 casinos across the country were shut-down due to COVID-19 restrictions, the gaming giant (MGM) decided to double down on online betting. When the virus hit the U.S. full force in March, Nevada reported more than a 90% year-over-year surge in online gambling.
“What you saw was when at the height of the pandemic, all of our resort casinos were closed. The only place that the company was making money was on sports betting and gaming online casino and poker,” George Kliavkoff, MGM Resorts’ president of entertainment and sports, said in an interview with Yahoo Finance’s “On The Move.”
While MGM is an institution in brick-and-mortar casinos, they’re still upstarts in the digital realm — and they face tough competition from sports betting apps already entrenched in the market. The sector has seen massive growth in recent years, valued at over $53 billion last year, and continues to grow.
In fact, industry leaders are seeing a banner year for revenue as the coronavirus keeps many consumers indoors and online. In earlier interviews this month with Yahoo Finance DraftKings (DKNG) and FanDuel (PDYPY) both said that the first week of the 2020 NFL season was their biggest week for new customer signups since fall 2015.
Kliavkoff conceded that both companies were “formidable competitors” given their large and fantasy sports-obsessed customer base.
In order to compete, MGM plans to leverage its resorts to create unique customer experiences to acquire and retain customers, using perks like access to Lady Gaga and other resident shows, said Kliavkoff. Last fall Yahoo Sports and MGM announced a multiyear partnership that "makes Yahoo Sports the official Digital Media Sports Partner of MGM Resorts.
“I think Las Vegas is already established entertainment capital of the world. And we're slowly becoming over the last three or four years the sports capital of the world,” he added.
Kliavkoff expects to see a continued surge in MGM’s sports books as major league teams return. Additionally, the company plans to open publicly ticketed live entertainment venues in the next couple of months, with social distancing rules in place. Until there is a COVID-19 vaccine widely available, MGM won’t be selling out stadiums.
Whether people remain shut inside during the pandemic or the country reopens, online gambling is a sector poised for significant growth.
“People want to bet and I think what's going to happen is coming out of COVID, with shortfalls in state budgets, you're going to see an acceleration of the legalization of sports betting initiatives across the country,” said Kliavkoff.
“We're predicting by 2025 38 states, vast majority of the U.S. population will have legalized sports gaming,” he added.
Yvette Killian is a producer for Yahoo Finance’s On The Move. Follow her on Twitter at @yvette_killian