DraftKings to Close Atlantic City Live Dealer Studio

ATLANTIC CITY, NJ — DraftKings announced that it will shut down its live dealer casino studio in Atlantic City, with the closure set to take effect on January 31, 2025. The decision will result in the layoffs of 101 employees, according to a notice filed with the New Jersey Department of Labor under the state's WARN Act. While the company assures that its live dealer games will remain available to customers, the transition marks a significant shift for the U.S. online casino industry as cost-cutting measures begin to reshape the landscape.

The closure of DraftKings’ bespoke live dealer studio, which opened in 2022, will lead to the loss of 101 positions, including dealers, technicians, and studio staff. DraftKings has stated that it will work to provide affected employees with support during the transition, including efforts to offer “a smooth landing” for as many individuals as possible. However, the layoffs are part of a larger trend in the online casino industry, as operators move away from maintaining expensive, in-house studios.

 

The End of Bespoke Studios?

The shutdown is expected to have broader implications for the online casino sector, as it signals a shift away from bespoke live dealer studios. While DraftKings will continue to offer live dealer games, these will be sourced from third-party providers, most likely Evolution Gaming, which has long been a partner of DraftKings for its live dealer offerings. Evolution is expected to provide the technology and support for DraftKings' new live dealer games, marking a transition from the custom-designed studio to more generic, shared environments.

This move raises questions about the future of other operators' dedicated live dealer studios. Competitors like BetMGM and FanDuel have similarly invested in bespoke studios, with BetMGM operating a studio in Michigan and FanDuel maintaining one in Pennsylvania. However, with DraftKings now stepping back from its Atlantic City operation, there are indications that other companies may follow suit in reducing or eliminating their in-house facilities as they look for ways to improve profitability.

 

Cost-Cutting in a Struggling Market

The decision to close the studio is part of a larger trend in the U.S. online gaming industry, which, despite record revenue numbers in recent years, has struggled with profitability. The high overhead costs associated with running state-of-the-art live dealer studios — including salaries, technology, and maintenance — can be difficult to justify in a market where margins are increasingly squeezed.

“Managing a bespoke studio is an extravagant expense for many operators, especially when the product can be outsourced to more cost-effective third parties,” said one industry insider. “We’re seeing a growing trend of operators choosing to consolidate their operations with larger providers like Evolution, which can offer economies of scale.”

Evolution Gaming, the dominant player in the live dealer space, is likely to remain DraftKings' primary provider for live dealer games. Evolution itself is expanding its secondary brand, Ezugi, with products that include higher-margin offerings like Triple Zero Roulette. This product line, designed to be more attractive to operators and players, suggests that Evolution sees a continued demand for live dealer games, but may be positioning itself to deliver those products in more cost-efficient ways.

Despite the potential cost-saving benefits of using third-party providers, the live dealer market remains highly popular among players. Live dealer games, which offer a real-time, human-powered gaming experience, have become a hallmark of online casino offerings. The ability to replicate the atmosphere of a brick-and-mortar casino through social interaction and real-time play has helped make live dealer tables the gold standard for online table gaming.

However, as operators move away from custom studios, there may be new compromises in terms of product offerings. For example, some companies may opt for Evolution's “First Person” line, which allows players to interact with a virtual dealer, or “hybrid” dealer options that blend human and automated elements to reduce costs.

 

The Rise and Fall of DraftKings’ Atlantic City Studio

The Atlantic City live dealer studio was part of DraftKings' broader push to expand its online gaming presence, particularly after its acquisition of Golden Nugget Online Gaming (GNOG) in 2022. Golden Nugget had been a pioneer in the U.S. live dealer market, operating the country's first on-site live dealer studio in 2016 in partnership with Ezugi, which was later acquired by Evolution. DraftKings’ decision to shut down the studio marks the end of a brief era of in-house live dealer gaming for the company.

Prior to the studio’s closure, DraftKings had been utilizing Evolution’s technology for its live dealer games, which were introduced in 2019. However, the new studio was intended to offer a more tailored and exclusive experience for DraftKings customers, aiming to differentiate the brand in a crowded market. Now, with the shift to third-party providers, players will likely see more generic live dealer tables, though DraftKings may request exclusive tables from Evolution for its platform.

 

We are supporting impacted employees to offer a smooth transition for as many as possible. Our live dealer offerings will remain uninterrupted.

 

What’s Next for the Industry?

The closure of DraftKings’ bespoke live dealer studio raises important questions about the future of live dealer gaming in the U.S. As the market matures and profitability becomes a larger concern, more operators may find that outsourcing live dealer games to third-party providers is a more sustainable strategy. The move away from in-house studios could ultimately lead to more standardized offerings, but it could also prompt innovation in other areas, such as virtual dealers or hybrid products that blend live and automated gameplay.

For now, DraftKings players will continue to have access to live dealer games, albeit through a different format. How the broader market adapts to this shift will be a key story to follow in the coming months.