As another successful year for the gaming industry draws to a close, trends suggest that the future will see continued growth, especially in terms of emerging technological advancements, evolving consumer preferences, focused regulatory enforcement and new cross-industry collaborations. Here are five specific areas of development to watch in 2025.
Technology
Perhaps the easiest future trend to identify each and every year is that technology will continue to rapidly evolve. In fact, the high-speed pace of technological advancement is redefining every facet of the industry, and those who fail to recognize this and take proper advantage of it risk falling behind those who do. Specific technology trends requiring close scrutiny include mobile gaming, blockchain, virtual reality, artificial intelligence and cryptocurrency.
Greg Brower
Connor Shea
Salma Granich
As a subset of the AI technology trend, casino operators are likely to focus on leveraging the use of AI-enabled analysis to offer more personalized offerings, such as custom-tailored experiences ranging from specific game recommendations to customized risk-management strategies. Similarly, AI will also play an increasingly critical role in casino digital loyalty programs with the ability to create unique promotions and offer real-time insights into patron behaviors and decision-making, thereby allowing operators to maximize the impact of marketing programs at the most micro level. ChatGPT might summarize it this way—the past year alone has seen an unprecedented increase in the use of AI, which is all but guaranteed to grow in the future.
Sports betting
Since the Supreme Court eliminated the federal roadblock back in 2018, sports betting has steadily grown toward becoming a $10 billion industry, with no signs of slowing down, and is only becoming more ingrained in the sporting lives of Americans.
Expanded markets, more creative in-game options, increased collaboration and cross-marketing between operators, leagues and competitors all seem to be part of the near-term future. Next year is also likely to see some smaller, independent sports betting platforms disappear from the marketplace, due to significant barriers to profitability and the continuing dominance of few big operators at the top of the heap.
Enforcement
The past year saw some significant anti-money laundering-related enforcement actions by both federal and state regulatory authorities, including a record-amount penalty and a first-ever felony conviction of a casino executive. This trend is likely to continue as the adherence to strict compliance is increasingly seen by regulators and legislators as the price to be paid for the rapid spread of legalized gaming.
In response, operators are well-advised to review every aspect of their compliance program in order to abide by all legal, ethical and regulatory standards, from AML and Know Your Customer procedures to data protection, privacy and everything in between.
Responsible gaming
As state legislatures around the country continue to consider expanding the universe of legalized gaming, they will also focus on attempting to mitigate the so-called “evils” associated with it; hence, legislative and regulatory efforts to encourage “responsible gaming” initiatives.
In the United States, we continue to have a patchwork of state laws and regulations that vary greatly in effectiveness from jurisdiction to jurisdiction. The old debate between individual freedom and the public good is likely to continue, with policymakers continuing to trend toward robust self-exclusion programs that allow individuals to restrict themselves without affecting the rights of others.
The economy
After a more or less good run over the course of the past 30 years and a record-setting post-COVID-19 rebound, the gaming industry is entering 2025 with an overall macroeconomic picture that has some warning signs.
Macroeconomic predictions are more like a compass than a GPS, but the second half of 2024 seems to have revealed some headwinds, especially for land-based operators, with slower growth and several markets reporting downturns. Given that consumer confidence seems to be down despite strong employment rates, future demand looks uncertain.
Tariff talk by the president-elect won’t help, as higher tariffs will likely act as a tax on consumption across the board, including discretionary spending on things like gaming and travel, potentially causing consumers to cut back.
Finally, the prospective economic landscape and seemingly all-but-certain impending changes at federal regulatory agencies such as the Federal Trade Commission could pave the way for mergers and other acquisitive activity throughout most industries, including the gaming sector.
While the above developments seem to be safe bets for the coming year, the only thing we know for sure is that 2025 will, as always, present other developments that are entirely unpredictable today. For the gaming industry, like most others, one constant is change, and those industry members who are able to quickly and efficiently adapt to the change, even if they can’t entirely anticipate it, will be at a competitive advantage as a result.
Greg Brower is a shareholder and Connor Shea and Salma Granich are both associates at Brownstein Hyatt Farber Schreck.
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