There are only six states, including Michigan, where online casinos are legally permitted.
Michigan’s online casinos have generated over $3.17 billion in operator revenue and surpassed $817 million in state tax revenue since their launch in January 2021.
However, states without iGaming are worried that the online product will eventually eat into the profits of the physical casinos within their borders.
The theory is simply untrue, as observed in Michigan.
Michigan’s tribal casinos are experiencing a surge in gaming revenue, surpassing the pre-pandemic figures of 2019, thanks to the thriving online casino industry in the state.
Despite varying levels of success, the three retail casinos in Detroit demonstrated their strongest revenue performance since 2019 during the first quarter of 2025.
With the addition of online sports betting and iGaming revenue, Michigan casinos are stronger than ever.
They ought to set a remarkable precedent for hesitant states considering the legalization of online casinos.
2022 commercial gaming sets records in Michigan, U.S.
Inclusive of Michigan, the gambling industry experienced an unprecedented year in 2022, setting records across the United States.
The commercial gaming value in Michigan experienced a notable surge, reaching $3.3 billion. This marked a significant 20.7% growth compared to the previous year.
In 2022, Michigan’s statistics can be broken down as follows:
- The retail casino revenue in Detroit amounts to $1.3 billion.
- The revenue generated from retail sports betting in Detroit amounts to $19.1 million.
- The online casino revenue in Michigan amounts to $1.6 billion.
- Revenue from online sports betting in Michigan reached $400 million.
The American Gaming Association reports that all three major verticals – casino slots and table games, sports betting, and iGaming – achieved record-breaking revenue figures in the United States during 2022.
The total revenue generated from casino slots and table games amounted to $47.83 billion, representing 79.3% of the overall commercial gaming revenue. Sports betting contributed $7.5 billion (12.4%), and online casinos accumulated $5.02 billion (8.3%).
According to the chart below, while online casinos are experiencing a significant increase in revenue, land-based casinos are also demonstrating a similar trend of growth.
Tribal gaming surpassing pre-pandemic revenue levels
Tribal gaming revenue is not included in Michigan’s total commercial gaming figures.
In 2022, Michigan’s 23 tribal casinos collectively contributed $30.8 million to local entities, as stated in the 2022 Tribal Gaming Report by the Michigan Gaming Control Board.
The stated figure accounts for approximately 2% of the total net win generated by the Class III slot machines at the casino throughout the year. This is the only available information regarding the annual revenue of tribal casinos in Michigan.
The payment of $1.54 billion, which is 50 times larger, falls short of the actual total gaming revenue generated by tribal casinos.
In 2022, the payment nearly equaled the record-breaking payment of $31.5 million made in 2021, falling just 2.2% short. Moreover, it surpassed the payment made in 2019, which amounted to $30.5 million.
In the fall of 2022, just like the world of commercial gaming, the United States witnessed a remarkable achievement in the tribal sector’s gross gaming revenue, as revealed by the latest AGA report. According to the report, in 2021, a total of 515 tribal casinos across the country generated a staggering $39 billion in GGR, marking a significant increase of 13% compared to the previous record of $34.6 billion set in 2019.
What do online casinos provide retail operators?
Online casino and sportsbook operators have formed partnerships with every brick-and-mortar casino operator in the state.
The revenue kickback received by retail operators is not clearly specified in terms of these deals, as they vary depending on the casino and operators involved.
Little River Band of Ottawa Indians, the operator of Little River Casino Resort in Manistee, expresses satisfaction with its online collaboration alongside BetRivers Michigan.
BetRivers generated a total of $104.3 million in online casino revenue and nearly $4 million in online sports betting revenue during the year 2022.
Little River Tribal Ogema Larry Romanelli expressed satisfaction with our agreement with BetRivers, stating that our staff’s prior experience with online gaming from other states has contributed to our success. Despite being a smaller casino with limited funds, Romanelli believes we have fared well. He mentioned that when comparing our online performance to other casinos in the state, we have performed decently over the past few years.
Hannahville Tribe thriving despite online struggles
Some tribes may not view things optimistically, but they likely have valid reasons for doing so.
The Hannahville Indian Community, responsible for operating Island Resort & Casino in Harris, is one tribe that has voiced concerns regarding online casinos.
Hannahville’s Chief Financial Officer, Scott Herioux, expressed to the New York Times that he believes online gaming poses a drawback to the retail product.
Herioux mentioned in the interview that if you belong to a remote tribe with a small population and your advantage used to be having slot machines, that advantage has now been significantly affected.
Herioux’s frustration could be attributed to its original online partner, TwinSpires, having chosen to exit the online casino and sports betting industry in Michigan last year.
Hannahville was left without an online casino partner for several months in 2022, resulting in a significant gap. However, Sports Illustrated stepped in to manage the online sportsbook and later obtained an online casino license in February of this year.
Although Hannahville has been falling behind in terms of iGaming revenue compared to its competitors, its brick-and-mortar casino seems to be outperforming the rest.
Hannahville tribe’s payment for 2022, amounting to $1.2 million, was derived from a 2% share of its tribal gaming revenue. This marked a notable 6.3% increase compared to the previous year, ranking as the second-highest growth among the twelve tribes in the state. Furthermore, it represented a significant 13.1% rise from the tribe’s 2019 payment, also placing second among all tribes in the state.
Despite facing some challenges with its online product, Island Resort & Casino seems to be thriving more than ever.
Detroit casinos still catching up from 2019
Returning to pre-pandemic levels has posed the greatest challenge for Detroit’s three retail casinos.
Although the three casinos have stabilized their revenue from 2021 to 2022, their retail gaming revenue is still 13.6% lower compared to 2019.
In Wayne County, the figures correspond to a decrease in visitor spending, which is the home to the three casinos. In 2021, visitor spending in Wayne County witnessed a decline of 30%, amounting to $5.5 billion, compared to the figures recorded in 2019.
Except for one, it is difficult to argue that online cannibalization is a significant issue, even when considering all three casinos.
In 2022, the MGM Grand Detroit generated nearly $600 million in casino revenue. To match its previous record of $623.5 million in retail revenue from 2019, it only needs to recover 4% of BetMGM Michigan’s online casino revenue, which amounted to $589 million in 2022. Additionally, there is an additional $6.24 million in retail sports betting revenue that should be taken into account.
In 2022, MotorCity Casino generated an impressive $396.5 million in retail revenue. Additionally, their partnership with FanDuel Michigan resulted in $258.7 million in online casino revenue. To surpass their remarkable record year of 2019, when they achieved $493.6 million in total revenue, MotorCity Casino would need the online casino revenue to constitute a larger portion, specifically 38%, of their overall revenue.
Since online gambling was legalized, Hollywood Casino at Greektown has experienced one of the largest declines. In 2022, the casino’s revenue of $260.5 million was 22.8% lower than the $337.2 million generated in 2019.
Bartstool Michigan, along with its online casino partner, generated a modest $52 million in revenue for 2022. However, in order to reach the revenue levels seen before the pandemic, they still have some ground to cover.
According to the AGA, Detroit held its position as the eighth-strongest commercial gaming market in the country for 2022, despite these figures. With a total of $1.28 billion, it trailed just behind Philadelphia’s $1.37 billion, securing seventh place.
In Q1 of 2025, the combined retail revenue for the three entities reached $326.2 million, marking a 3.4% increase compared to the $315.5 million recorded in Q1 of 2022.
In-person experience still triumphs at Michigan retail casinos
Casino operators in Michigan are showing little worry regarding the ongoing expansion of online casinos in the state.
No matter what online operators may provide, the social experience of a physical casino remains unmatched.
According to Romanelli, there are individuals who believe that online casinos will eventually dominate the gambling industry. However, he disagrees and believes that this will never happen. In his opinion, retail casinos provide a social experience for those who enjoy gambling. People like to be surrounded by lights, action, and other individuals while enjoying a drink or two. Online gaming fails to fulfill this need for social interaction. Romanelli anticipated that a portion of the market would be captured by online gambling and made preparations accordingly. As a result, the impact has been mitigated, and the industry has stabilized.
Many people in Michigan are still drawn to retail casinos because of the social environment they provide. The Facebook group “What Happens At The Casino Stays At The Casino” has gained over 11,000 members who continue to choose playing at the casino with friends and family.
Tim Stevens, one of the founders of the group, expressed his stance on online gambling, stating, “I can assure you that I have never engaged in online gambling, nor do I have any plans to do so. The thrill for me lies in physically going to a casino, as the atmosphere and sounds create an unparalleled experience. Additionally, I value the company of my friends during these visits. The idea of solely engaging in gambling activities through my phone does not hold any appeal for me.”
Retail casinos getting younger demographics
Despite technology usually being associated with younger individuals, retail casinos are experiencing a decrease in the average age of their patrons.
According to the AGA, the median age of individuals visiting casinos has seen a decline after the pandemic. In 2022, the median age stood at 42.4, compared to 49.6 in 2019. This change could be attributed to various reasons such as safety apprehensions or a simple yearning for social interaction.
Casinos returning to non-gaming entertainment options
Consumers are being attracted to non-gaming formats offered by retail casinos, which are contributing to their revenue.
With the state gradually emerging from the pandemic, retail casinos are witnessing a surge in shows, concerts, and an expansion of dining options including restaurants and buffets.
Romanelli expressed the desire to appeal to a younger audience by reintroducing dance and similar activities. Due to the pandemic, certain elements had to be eliminated to prioritize safety, such as spacing out the machines. However, now there is a focus on reintroducing more music, including live performances by acts on the weekends, as well as potentially having music during the week and featuring local bands. Romanelli believes that these additions contribute to the overall appeal of casinos.
According to the AGA study, the number of individuals visiting casinos primarily for non-gambling entertainment has decreased. However, there has been an increase in the number of people who visit casinos for gambling purposes while also enjoying other entertainment options available.
Based on various indicators and studies, it is evident that retail casinos in Michigan are not being negatively impacted. On the contrary, the introduction of online casinos has proven beneficial, generating additional revenue for the state and reinforcing the overall prominence of Michigan’s gambling sector.
