New Jersey’s Atlantic City is well known for its casino’s and gambling, but now that concept has been taken online. On Feb. 26 New Jersey Governor Chris Christie legalized online gambling, as long as it is affiliated with in-state casinos. Nevada and Delaware have also signed similar legislation into law. This is what boosted both Zynga Inc (NASDAQ:ZNGA)‘s and Glu Mobile Inc. (NASDAQ:GLUU)‘s stock prices in the past month, especially Zynga’s. The idea is that Zynga and Glu (who recently released a real money gambling app in the UK) will be able to boost their top and bottom line’s by tapping into the huge real money gambling market in the US. Glu already is entering the UK gambling market, and Zynga is planning on offering real money gambling games on Facebook Inc (NASDAQ:FB)‘s online platform.
On a side note, this would help Facebook Inc (NASDAQ:FB) keep users interested in its website, as gamblers would come to the website to have fun for long periods of time, and Facebook’s news feed could keep your friends updated on your wins and losses. Facebook Inc (NASDAQ:FB) has been hit with “Facebook fatigue” recently, and needs something to keep users interested. Facebook Inc (NASDAQ:FB) could also make some money off of this by taking a little bit of the gains that Zynga Inc (NASDAQ:ZNGA) would make, and by offering highly targeted ads towards those playing poker a lot. More women than men play online poker, so you also could provide a strong advertising opportunity towards that demographic as well.
Glu is currently working with Probability (a UK company) to create a suite of casino apps, and Zynga has applied for a gambling license in Nevada (Nevada’s online gambling legislation is a lot less strict than New Jersey’s). While Glu hasn’t been pursuing the US gambling market like Zynga Inc (NASDAQ:ZNGA) has, one can assume with the recent legislation they will be releasing apps for real money gambling pretty soon for the US. The question is, will this help turn around Zynga’s and Glu’s stock prices, or will they continue their decline after the excitement calms down?