N.J. casinos' revenue dropped in January, sparking fear of trend

ATLANTIC CITY, N.J. (AP) -- Ever since casino gambling began here in 1978, revenue at the gambling halls has been on a one-way trip -- straight up.
But for the first time, annual revenue from Atlantic City's casinos could decline in 2007. The industry faces increased competition from slot machines in neighboring states, new restrictions on smoking and the closing of one casino.
The first monthly revenue figures of the new year were down, raising concern that it could be the start of a yearlong trend.
If revenue goes down, it could have negative consequences for the industry, its customers and the state of New Jersey, which relies on casino taxes.
"There will be an impact, no doubt," said Carlos Tolosa, eastern division president for Harrah's Entertainment Inc. "The Pennsylvania slots parlors will certainly cause competition. In the past, people just came to Atlantic City. That's the part that always scares you. Atlantic City relies on high-frequency customers."
Already, Pennsylvania slots parlors are cutting into Atlantic City's pie. Figures for January, when Atlantic City went head-to-head with two new Philadelphia-area slots parlors, had New Jersey casino executives reaching for the antacid tablets. Overall revenue at Atlantic City casinos declined 2.9 percent compared with a year ago, but the decline in slots revenue was even sharper at 7.2 percent.
Philadelphia Park, in Bensalem Township, about 20 miles north of Philadelphia, opened Dec. 19. Harrah's Chester Casino and Racetrack opened Jan. 22. Executives of those gambling halls said they targeted gamblers who otherwise would have gone to Atlantic City.
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