We’ve seen more interest from governments in the Canadian provinces as they evaluate legalizing online casino for private operators, following the lead of Ontario. Rush Street Interactive (RSI) CEO Richard Schwartz named Québec as one of several prospective markets worldwide for igaming, and suggested there could be movement on igaming reform in the province within the next 12 months.
He also said the decision by regulators in neighboring Ontario to release more robust information about igaming revenue shows RSI is outperforming its rivals there — all the more reason to take a good look at Québec, the second-most populous Canadian province.
The remarks are an extraordinary development, considering Québec is a jurisdiction that does not currently run a regulated market of private operators. Rather, igaming in Québec is a monopoly afforded the provincial lottery, Loto-Québec.
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But Schwartz’s comments show RSI, a top-5 igaming operator in the US, is banking that attitudes in Québec could change and that the province could adopt a regulated market for online poker, casino gaming, and sports betting similar to neighboring Ontario’s. An industry-led group, the Québec Online Gaming Coalition (QOGC), met recently with the provincial government to discuss that very idea.
RSI is a member of QOGC.
“We’ve seen more interest from governments in the Canadian provinces as they evaluate legalizing online casino for private operators, following the lead of Ontario,” Schwartz said during an earnings call to discuss Q2 2023 on Wednesday.
“Based on our success in Ontario, these efforts are potentially very exciting for us. As we’ve said several times before, we continue to remain confident over the long term given the potential economics to government budgets, especially when compared to inflows from online sports betting.”
RSI is also developing an online poker platform based on a rebooted US-version of Run It Once (RIO) poker. The platform is expected to go live in either late 2023 or 2024 and could potentially launch in Québec at some point.
RSI Doing Better Than Its Rivals in Ontario
We continue to perform very well in the highly competitive Ontario market, as we are generating outsized year-over-year gains as well as sequential growth. Last month, iGaming Ontario (iGO) reported that revenue from igaming totaled CAD $545 million (USD $414 million) during Q1 2023, which ran from April 1 to June 30 of this year. Online casino gaming accounted for about 72% of revenue, followed by 25.2% from online sports betting and 2.9% from online poker.
Although neither iGO nor RSI provided specific revenue data for Q1, Schwartz said its BetRivers brand for online casino gaming and sports betting “has another strong quarter.”
“We continue to perform very well in the highly competitive Ontario market, as we are generating outsized year-over-year gains as well as sequential growth,” the CEO said. RSI also recorded an average revenue per monthly active user (ARPMAU) rate of $359 in Q2 2023, which Schwartz said was “significantly higher than the market’s, coming in at well over double that of our competitors.”
Schwartz said that Ontario online casino gaming, accounting for nearly 75% of the market, “is similar to what we’ve seen in US markets with [online casino] and should provide an outsized benefit to RSI as future iCasino markets launch.”
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Québec Looking to Emulate Ontario, CEO Says
It’s always hard to predict, but you are seeing more states introducing legislation and putting really serious lobbying efforts toward having some movement. When asked during the Q&A portion of Wednesday’s call, what jurisdictions could potentially launch some form of igaming within the next 12 months, Schwartz mentioned Québec by name.
“It’s always hard to predict, but you are seeing more states introducing legislation and putting really serious lobbying efforts toward having some movement,” Schwartz said. “In Canada, you’re starting to see, [in jurisdictions other than Ontario], marketing to consumers by operators who aren’t paying taxes there. They certainly would like to take that lead from Ontario and be able to generate some [tax revenue].
“There’s Quebec and British Columbia as well that are showing various signs of interest.”
Loto-Québec provides online poker and casino games through its Espace Jeux platform. It provides sports betting through its online sportsbook, Mise-O-Jeu.