Mohegan Sun to jump-start online gaming in CT

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With results flat from its foray into interactive gaming in Pennsylvania amid intense competition there, Mohegan Gaming & Entertainment is rebooting its efforts with a new Mohegan Digital division to create gambling apps and websites starting on its home turf of Connecticut.

The announcement comes weeks after Connecticut approved interactive gaming. Mohegan Gaming & Entertainment operates the Mohegan Sun casino in eastern Connecticut, among the largest in the United States along with the nearby Foxwoods Resort Casino.

Foxwoods has an existing partnership in place with DraftKings for online sports betting in Connecticut, with DraftKings also offering iGaming apps in New Jersey and three other states. On Thursday, Gov. Ned Lamont announced provisional licenses for affiliates of Foxwoods and Mohegan Sun to conduct online fantasy sports contests, with Mohegan Sun to partner with FanDuel which offers online casino games as well.

Rich Roberts leads the new Mohegan Gaming & Entertainment division as president, earlier in his career having led a startup called FaceOff which developed an e-gaming platform.

In March, MGE promoted Ray Pineault to CEO as the replacement for Mario Kontomerkos. Pineault told the Nevada Gaming Commission this month that MGE had been unable to reach an agreement with Kontomerkos on a new contract, according to CDC Gaming Reports.

In a statement forwarded by a spokesperson, Pineault said MGE is “working through” a strategic plan for iGaming and that Connecticut has yet to finalize its regulatory processes for online wagering.

Through an affiliation with Unibet, Mohegan Sun already already offers an interactive gaming app in Pennsylvania where it operates the Mohegan Sun Pocono resort in Wilkes-Barre. Between July 2020 and this past May, Mohegan Sun generated $1.1 billion in iGaming revenue and nearly $9 million in tax revenue for Pennsylvania.

But Mohegan Sun iGaming revenue in Pennsylvania was down 15 percent in May from the July totals last year, versus an 80 percent gain for the overall Pennsylvania market. The overall total was driven largely by casino giant Penn National Gaming quintupling revenue to nearly $1.4 billion in May from its apps and websites that include Hollywood Casino and Barstool Sportsbook.

In February, Penn National reached a deal to enter the New York interactive gaming market through an affiliation with Rivers Casino & Resort outside Albany.

Speaking with investment analysts a month ago, the CEO of DraftKings said his company is looking ahead to the New York market as well. He added that DraftKings has seen differing rates of adoption for its apps state to state, with Michigan a boom market and New Jersey flatter.

“It’s hard to compare apples to apples,” said DraftKings CEO Jason Robins, in a late May conference call. “Pennsylvania is an interesting one. ... We have not invested as deeply in from a customer acquisition standpoint due to the tax rates there — it’s just not as profitable as the market for us.”

In addition to forming Mohegan Digital, MGE was focused this spring on opening the new Mohegan Sun Casino Las Vegas a few blocks from MGM Grand Las Vegas. Nevada authorities levied a $60,000 fine on MGE right out of the gate after photos surfaced on social media showing casino patrons in close proximity and without face masks, in violation of Nevada restrictions to limit the possibility of any transmission of COVID-19.

At its Connecticut casino, Mohegan Sun’s slot handle had yet to rebound to pre-pandemic levels as of May, with $544 million wagered for a 7 percent decline from May 2019 according to state records. Foxwoods has seen a bigger decline, with its slot handle off 15 percent to $397 million, off 15 percent from two years ago.

And both casinos are adding events that had been put on ice during the pandemic, including the popular Terrificon comic convention kicking off at Mohegan Sun at the end of July and Jackson Browne, Tanya Tucker and Train to play Foxwoods in August.