By Sue Zeidler
LOS ANGELES (Reuters) - Borgata Hotel Casino & Spa, owned by Boyd Gaming Corp's and MGM Resorts, said it received the first Internet gaming permit ever in New Jersey from the state's Division of Gaming Enforcement.
New Jersey last February became the third state after Nevada and Delaware to legalize online gambling, but the casino industry views New Jersey as the most lucrative opportunity based on size and the fact its law encompasses many forms of gambling, while Nevada's regulations, by contrast, allows online poker only.
Nevada was the first to go live with online gambling in April when Station Casinos launched the first offering known as UltimatePoker.com. New Jersey is expected to go live in late November with Internet gaming.
Borgata, one of the 12 hotel-casinos in New Jersey's Atlantic City, said it had worked closely with the division throughout the process. A spokeswoman for the division confirmed it was the first Internet gaming permit to be issued by the state.
The gaming enforcement division has said Internet gambling, limited to the 12 hotel-casinos and their partners, will begin in New Jersey on November 26, after a trial period to make sure things work properly.
Analysts estimate that Nevada's online gambling market will yield $50 million to $250 million in annual revenue, while New Jersey's will generate $500 million to $1 billion yearly.
Other operators that applied to offer online gaming include Caesars Entertainment; Donald Trump's Trump Entertainment Resorts; the Tropicana Casino and Resort, sold in a bankruptcy sale to a group of creditors led by Carl Icahn in 2009; and The Golden Nugget, owned by Landry's Inc.
Off-shore poker websites such as PokerStars were the forces behind the last online poker boom, starting around 2003. But that all changed on April 15, 2011, which is known in the industry as "Black Friday," when the U.S. Department of Justice indicted the founders of several sites on charges of bank fraud, money laundering and illegal gambling offenses.
The sites were closed to U.S. online players, and now companies such as PokerStars are trying re-enter the market through potential partnerships in the United States.
Resorts Casino Hotel has joined with PokerStars, which had tried to buy the Atlantic Club Casino Hotel earlier this year before the deal fell apart.
The trade group for the U.S. Casino industry, the American Gaming Association, asked New Jersey regulators in March to reject a petition by PokerStars for interim authorization to buy the Atlantic Club, a small casino in Atlantic City.
PokerStars has said its deal with Resorts is pending approval by the New Jersey regulators.
The Borgata is partnering with Bwin.party Digital Entertainment Plc for its online gambling offering. The state's other casinos will also partner with online gaming companies.
"This is a big step towards the opening of the regulated market for online gaming in New Jersey next month," said a spokesman for Bwin.Party.
Gamblers would have to be physically in New Jersey to play.
"We're location-enabling Boyd and other applicants there. New Jersey is aggressively moving forward," said Rip Gerber, founder and CEO of Locaid, which helps companies locate their customers, employees and assets through location technologies.
(Reporting By Susan Zeidler. Editing by Andre Grenon and Steve Orlofsky)