GPWA Times - Issue 21 - May 2012

Where to now in the U.S. – and who’s driving? One year after the darkest day yet for online gaming in the U.S., the industry is still waiting for a signal from Congress or the states that it’s time to move forward. Five industry experts share their views. By Vin Narayanan B lack Friday. In the online gaming world, those two words mark a moment that resonates, even 13 months after the fact. The U.S. Department of Justice (DOJ) indictments of the founders of PokerStars, Full Tilt Poker, Absolute Poker and UB.com (formerly UltimateBet) unleashed a chain of events that dramatically reshaped the landscape of the U.S. market. All four poker rooms pulled out of the U.S. following the indictments, leaving the Merge Gaming Network, Bovada and the Cake Poker Network as the last major poker networks in the country. PokerStars returned all money owed to American players. Full Tilt Poker ceased operations after Alderney suspended its license for failing to pay out players, not only in the U.S., but throughout the world. Full Tilt also saw Group Bernard Tapie end acquisition talks after it could not guarantee it would pay all players back immediately. And Absolute and UB are shells of their former selves. Meanwhile, in the United States, major casino companies lined up – or are lining up – online gaming partners in anticipation of state governments licensing and regulating the game. MGM and Boyd Gaming inked a deal with bwin.party to deliver online poker. Cae- sars is working with 888 (through Drag- onfish) to provide online poker in the U.S. Shuffle Master is buying the OnGame Net- work. And International Game Technology bought Entraction. In December, the DOJ gave the online gaming industry an early Christmas present when it said the Wire Act only applied to sports betting, and not to other forms of online gaming. As of press time, Nevada was the only state on the road to issuing online gaming licenses, with first approvals set to arrive later this year. Legislation in New Jersey shows promise, with new language designed to avoid Gov. Chris Christie’s veto pen. Lobbyist Barbara DeMarco told the Global iGaming Summit & Expo (GiGse) last month that the only real obstacle to earning Christie’s signature on the bill is election-year politics. But outside of Nevada and New Jersey, the outlook for online gaming legislation and regulations is cloudy. Federal legislation won’t pass Congress unless Senate Majority Leader Harry Reid (D-Nev.) attaches it to other “must pass” legislation, much like the way that the Unlawful Internet Gambling Enforcement Act was passed in 2006. And if Mitt Romney wins the U.S. presidential election, all bets are off. In California, online poker legislation faces significant opposition from Native American tribes that operate casinos. In Iowa, the State House of Representatives refused to consider legislation passed by the Iowa State Senate. And in other states, online gaming legislation is struggling to take off. Against this backdrop, five of the most influential people in America’s gambling industry agreed to talk with me about the state of the online gaming industry one year after Black Friday. In a series of exclusive interviews at GiGse, they look back at the events over the last year, and look forward to what the online gaming industry might look like in the United States over the next several years. 23 Where to now in the U.S. – and who’s driving?