Gambling Online: What about bonuses?
While land-based casinos offer players free meals, drinks, and rooms in exchange for their play, online casinos tend to offer the only readily available substitute they have: cold hard cash. Almost every online casino offers a sign-up bonus, where they match your initial deposit with extra chips. These bonuses can be quite lucrative in some cases. Many sites also have ongoing promotions where they offer extra chips.
If you play where a bonus is involved, be sure to read the fine print, the so-called "terms and conditions". Sometimes you'll have to email the casino to receive the bonus. Sometimes you'll have to play through your deposit one or more times before you are eligible for the bonus. And, in almost every case, you'll have to wager several times the amount of the deposit and bonus before you'll be allowed to withdraw the money.
However, in most cases, a smart player can expect to make a nice profit from the bonus. For example, consider a MicroGaming casino with a "Buy $50, Get $50 Free" bonus offer. Let's say the bonus requires you to wager the deposit and bonus 20 times before cashing out. So, you purchase $50, they add another $50, you start with a balance of $100. You'll need to wager at least $2000 before cashing out. For example, you could play Blackjack at $10 per hand for 200 hands. Most blackjack games available online have a house edge of less than 0.5% if you use the correct basic strategy. So, for your $2000 in action, the expected loss is only $2000 X 0.005, or $10. The casino has paid you $50 to give them $10 in expected losses. Not a bad deal!
Update: These deals have become less lucrative than when this was originally written. Many casinos now prohibit playing blackjack for purposes of the bonus wagering requirements. Instead, you'll have to play some of the games with higher house edges. Read the terms carefully.
Of course, that $10 is the average loss for a perfect basic strategy player. Your luck will determine what happens with your bankroll. You may lose the $100, or you may win $100 or more. But, in the long run, you'll get to keep about $40 of that $50 bonus.
However... Bonuses have become the bane of the online casino industry, with some players being categorized by the casinos as 'bonus abusers'. In most cases, these are players who meet the terms and conditions to the letter, cash-out the bonus, and are never seen again. The reputable online sites know that some players will play strictly for the bonus, cash-out, and never come back to play again. That's just the cost of attracting new players to their casino. However, some of the more questionable sites will use any excuse they can to avoid paying a player who appears to be there for the bonus only.
Make absolutely sure you abide by all of the terms they mention. And, my recommendation is to play much more than the minimum required action to cash out the bonus. Remember, over the long run, your edge is huge. Sure, you may run into a run of bad cards and lose that $100. But, you will also occasionally run into a good run of cards and turn it into $1000 (granted, probably not with flat $10 bets). If I were playing our example bonus, I'd probably play at least $3000 in bets, and probably $4000 or $5000.
Of course, if you stick to the cream of the crop of online casinos, these guys are going to pay you quickly anyway. They understand that if a player meets the conditions, the bonus is theirs, fair and square. If they pay promptly, maybe they'll gain a player for a long time.
Bonuses are one of the last great giveaways you're likely to see. I don't think the large bonuses available today will still be here a few years from now. They're just too expensive for the casinos. So, get 'em while you can.
Update: The really lucrative ones have indeed disappeared. Today's bonuses are great for trying out casinos, but they are no longer a quick way to make a sure profit. Still, read the terms, and take advantage of whatever offer is available.
Next, we'll wrap it up with an overall summary...
Since passage of new legislation in late 2006, my current recommendation is that you do not gamble online if you are located in the United States. Eventually I hope that we will see legalization, regulation, and taxation of online casinos in the US.