Online Gambling

Casinos Warm to Online Poker


The New York Times reports that American brick-and-mortar casinos are warming to online gambling—primarily poker, which they think can generate new revenue without cannibalizing their existing business too much. The Times says the American Gaming Association is "working on a proposal that would ask Congress to legalize at least some form of online gambling." Companies such as Harrah's have supported legalization for a while, but now even naysayers such as Wynn Resorts seem to be coming around:

A gambling industry analyst, Sebastian Sinclair, said that a change of heart among casino operators like Wynn Resorts should not be surprising, given the stakes involved. One of the Internet poker industry's biggest sites, Pokerstars, which operates on the Isle of Man in the Irish Sea, has estimated annual revenues of $1 billion, according to Poker Analytics, a consulting firm in New York.

"When any industry is confronted with something of this nature, a game changer that is a paradigm shift, the first reaction is to circle the wagons to protect your business," Mr. Sinclair said. "But then, that changes over time."

Now that the casino industry is rethinking its opposition to online gambling, the Times says, so is Senate Majority Leader Harry Reid (D-Nev.). Whatever legislation ensues is likely to be less liberal than the bill sponsored by Rep. Barney Frank (D-Mass.), which would legalize all gambling except sports betting at the federal level while allowing states to ban some or all games within their borders.

I analyzed the futile federal crackdown on Internet gambling in a 2008 Reason article. In April I noted the possible life sentence faced by Daniel Tzvetkoff for helping Americans play poker online. What is now a felony treated as harshly as murder may soon be a new profit center for Harrah's and Wynn Resorts.

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  1. Now that the casino industry is rethinking its opposition to online gambling, the Times says, so is Senate Majority Leader Harry Reid (D-Nev.).

    “My offer, senator, is this: Nothing.”

  2. Could the Nevada casinos have in their hands compromising photos of Mr Reid with a burro?

  3. Fucking rent-seeking filth. These guys are only for it so they can help write the law and control it in perpetuity. They don’t want the competition. Don’t be surprised when it is written into the law that in order to operate an online poker site, one must operate a brick and mortar casino within the US. Oh, and I bet you won’t be able to operate that brick and mortar casino on a reservation either, because they already get their tax break.

    Warming to it, my ass. They just want to keep control of their empire.

    1. Exactly. It could even end up being restricted to the states the casinos are in. Similar to state liquor protectionism.

      1. But, that would keep them from doing business nationwide. I can’t see it going that far. State liquor protectionism exists to boost the state tax receipts.

        If that scenario happens, it will be from state governments. Since internet traffic and commerce tend to be across state lines, I see it working like online malls do, and they look like they are about to see some new tax laws come their way.

    2. Pretty much.

  4. It is so saddening to see a few of the casinos actually opposing online poker. No matter how they want to look at it, all that online poker popularity does to them is drive up their business as well. Imagine is there was no online poker. There definitely wouldnt be as many players playing in the WSOP, other live events, or in local casinos…that is for CERTAIN!

    Poker Training

  5. The recession has hammered Vegas.

    A weekend throwing money away is pretty much the definition of “Luxury Good” (and Obama shaming a lot of public companies into not having their conferences in one of the few cities with the infrastructure to handle such things certainly didn’t help).

    They’re desperate for money. If folks were still going to Vegas like it was 2005, Vegas would be throwing money at Abramoff in order to ensure that children were protected from Online Poker.

  6. Bill Bennett will be glad to hear this!

  7. a game changer that is a paradigm shift, the first reaction is to circle the wagons

    He’s going for the metaphor inside straight.

  8. The recession has hammered Vegas?…maybe they should have been smarter and banked away their money instead of ridiculous spending 🙂

    Poker Training

  9. Exactly as comment above said . Those real casinos are for legislation only to have control over online casinos . Sad is that actually only Government should do it , in cooperation with online casino owners .

  10. NYT:
    “Poker Analytics said that data it compiled indicated that there were significant differences between those gambling in casinos and those playing poker on the Web. Among them, it said, was that people who played poker online were more likely to be male and less wealthy than those who visited casinos.”

    I have runned casino sites for a few years now, all I can say it that i cant disagree more!

    People playing online are everyone, cant generalize them like that..:/

  11. The problem today is obviously Sheldon Adelson who is fighting a strong struggle against regulated online gambling in the USA.

    True, he was not able to get Newt Gingrich elected as the republicans candidate for 2012, but his power and money should not be underrated, especially when he is fighting on home turf (the casino industry).

    Things will probably come around slowly, as we see minor forms of regulated gambling are happening in New Jersey and Nevada. Cali will probably follow soon.

    I have been working in the casino-software industry for several years, and i know that if we can bring in only a fraction of what the big dogs like Net Entertainment, Microgaming and Playtech earns, the local communities/organizations wil benefit greatly from that.

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