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StumbleLegal Internet gambling may help big casino firms, hurt small ones
Monday, Sept. 6, 2010 | 2:01 a.m.
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- Nevada gaming companies see potential flush online (8-2-2010)
- Online gambling is illegal, but betting sites’ logos often in Nevada casinos (7-13-2010)
- Online poker law in effect, but players still manage to bet (7-11-2010)
- Question evolving from legalization debate: How to tax online casinos? (5-24-2010)
- Lawmakers push to regulate, tax online gaming (5-19-2010)
- With aggressive push, Internet gambling again in play (2-9-2010)
- Why casinos in Nevada won’t go online (for now) (8-20-2009)
- Will Web poker bust spark fight or flight? (6-15-2009)
- Poker players swarm site seeking input on big issues (5-19-2009)
- Web betting is wedge for Big Gaming (11-25-2008)
- Bush administration moves on Internet gaming band (11-12-2008)
- Gaming’s new frontier (11-23-2007)
- Online gaming in the shadows (7-17-2007)
Although major U.S. casino companies see a potential gold mine in legalizing Internet gambling, some operators of small, neighborhood casinos in Nevada — which make up most of the properties in the world’s largest concentration of gambling halls — see problems.
One of them is Greg Lee, whose family owns the Eureka casinos in Las Vegas and Mesquite.
Neither Lee nor any other casino operator knows for sure what will happen if online gambling is regulated in the United States, but he is not bullish about the prospect of competing with bigger brand names for poker or other kinds of gambling online.
Bricks-and-mortar casinos survive by virtue of having convenient locations and relationships with customers, while online retailing is a monopolistic world where those with the biggest brands and most customers crowd out smaller competitors, Lee said.
“Online, the money flows to the companies with the dominant (economies of) scale,” he said. “It’s hard for me to see how this would benefit my business.”
In the more than decadelong debate on Internet gambling in Congress, the loudest proponents for legalization have been foreign-based gambling websites and their supporters, including countless celebrity and no-name poker players who have flocked online in recent years. A few U.S. casino companies that have much to gain from Web versions of their casinos have joined the effort.
Rep. Barney Frank, D-Mass., has introduced legislation to repeal the 2006 ban on Internet gambling.
The American Gaming Association threw its support behind the prospect this year — provided that it included tough licensing requirements and other means of oversight. The association remains neutral on the legalization bill being shepherded by Rep. Barney Frank, D-Mass., through the House of Representatives. An outspoken social liberal, Frank, chairman of the House Financial Services Committee, has championed legalization, arguing that prohibition is ineffective, oppressive and financially disadvantageous to American companies and the U.S. government.
Most U.S. casinos aren’t members of the association, nor do they have lobbyists in Washington, weighing in on the debate. The Tribal Alliance of Sovereign Indian Nations, 14 California tribes that operate major casinos, opposes Internet gambling on the grounds that casinos granted exclusive rights to operate in their respective regions for the benefit of tribal members will suffer at the hands of new competition. Los Angeles’ Commerce Casino, which operates the nation’s largest poker room, also opposes legalized online wagering.
The Nevada Resort Association, which represents larger casinos at the state level, has not taken a position — reflecting a disagreement that exists not only among large and small operators but among officials who work within these same properties. And yet, the Culinary Union in Las Vegas supports online poker, siding with the majority view held by the leaders of its union-organized casinos that Web poker rooms will protect and create Nevada jobs.
Concerns that Internet gambling will cut into casino profits or hurt jobs have yielded careful responses from Nevada Sen. Harry Reid, who holds the keys to Internet gambling legislation in the Senate.
Reid supports the legalization of Internet poker, a position that is more palatable for casinos that view widespread Internet gambling as greater competition. That support comes with one major caveat: Reid has said he will oppose any online gambling legislation that fails to protect Nevada jobs.
It’s anyone’s guess how that would materialize, as the current legislation contains no such guarantees, nor any restriction on outsourcing jobs to foreign shores.
Harrah’s Entertainment, one of the two largest operators of Las Vegas casinos, is an outspoken supporter of gambling online.
Last year, Harrah’s Entertainment commissioned a study by McKinsey & Co. that concluded that Internet gambling could triple the U.S. gambling market rather than cannibalize it, resulting in more profit for American casinos as a whole.
The study based that conclusion on the growth of casino poker in the wake of Internet poker rooms, European-based Internet gambling companies that have grown post-regulation, as well as U.S. retail chains that boosted overall sales after launching Internet stores.
Businesses that have not adapted to the Internet have died, while those that have leveraged online sales have multiplied profit, said Jan Jones, Harrah’s senior vice president of communications and government relations. The company owns the World Series of Poker, arguably the biggest poker brand, yet Harrah’s has not been able to fully capitalize on its popularity with online poker players because of the federal ban on Internet gambling.
With the casino gambling market slowing down in the United States, Internet poker presents a golden opportunity for casinos that largely cater to older Americans to capture younger customers — people who typically spend more on entertainment even though they have less time for leisure activities than older consumers, the study said.
Not only are Internet casinos relatively cheap to develop — a few million dollars relative to the hundreds of millions required for land-based casinos — many sites employ thousands of workers who are needed to manage player accounts, Jones said.
“This is a new industry that would come to Nevada,” she said. “This would help us protect jobs and create new jobs.”
Reid is expected to push for a requirement that Internet gambling jobs be located in the United States and other provisions that would ensure Nevada casinos get “maximum benefit” from congressional legislation, Jones said. Nevada’s Gaming Control Board could take the lead in licensing and regulating Internet gambling operators across the country, for example.
Even small casinos, Jones said, could get a piece of the action by licensing software from third parties and joining Internet gambling portals.
Many executives think there is little crossover between the person who plays poker online and the customer who visits a casino to play video poker or enjoy other forms of entertainment. That’s according to Billy Vassiliadis, CEO of R&R Partners, which does advertising and consulting work for the gaming industry.
Smaller operators are probably at little risk of losing jobs to Internet poker rooms unless they have significant poker operations, like the bigger casinos, added American Gaming Association CEO Frank Fahrenkopf.
Still, neighborhood casinos that lack the resources to develop a big online presence have every right to be concerned about a future where Internet gambling sites will be more numerous and more heavily advertised than they are today, said Bill Eadington, director of UNR’s Institute for the Study of Gambling and Commercial Gaming.
“Internet technology is only going to favor a few large organizations relative to the entire industry, not unlike Microsoft, Google and Yahoo relative to other software and Internet provider companies,” Eadington said.
Smaller operators should be figuring out how to make technology work for them, he said.
Lee views Internet gambling as an opportunity for the big boys, not his Eureka casinos.
Not that anyone is asking for his input.
“This makes sense for the bigger players. As a small business, we’re completely left out of the loop. Nobody is really interested in our perspective.”
Discussion: 4 comments so far…
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this would be good for all casinos offering them a big chance of advertising their rooms online whilst people play around the world.
On another topic to the SUN can you run a poll on legalizing prostitution in clark so we can see what the results would be like, as personally think this would be a good way to boost sin city and raise much needed taxes
Internet gaming is already a reality.
The US should just recongize that move along.
It is a moot point.
Oh yes, with the internet gambling we will see more bankrupcies and more foreclosures. Convenience of this pastime would cause many personal problems.
I'm surprised that it's not already legalized at the very least in NV. It would lead to a lot more computer jobs in NV and the casinos could entice new players w/rooms at their bricks 'n mortar casinos. Now only the foreign companies get our players' $$$$
Sgt Rock you wizzard you, I wonder if internet gambling is already a reality then why are some of the operators of off shore interent gambling sites in prison? Why are most of the original off shore sports and horse betting sites closed down. Yes there are still'some' interent gambling sites but they are constantly moving to avoid detection and prosecution. If what you said was true why doesn't Harrahs just go do it? Think and investigate before you post.As usual you go off with a ridiculous,ignorant rant. Now go turn on Fox News or Rush and see what the lying points are today.
The tell America how to live while doing the opposite,do gooders,evangelist, Republicans will put a stop to this untill someone pays them off, then the flood gates will open.Just where is that 'Promise Keeper'Ensign hiding out these days?
homer you are very wrong
many gaming companies are very big,powerful and floated on the london stock exchange, they just use IP detection to avoid the USA.
What kind of idiot would gamble online? As if the vig isn't bad enough in the real casinos, the online ones are all rigged for the player to lose.
Greg lee complains of being on the down side of capitalism by saying how does it help his operation, Mr lee I want to open a Internet casino that will be as close as I can afford to open one I don't have a million or so in capital but I can open one of these for less than a hundred grand so you choose to suppress me by opposing something that would promote free enterprise it looks as if I am also on the down side of capitalism from you and the big branded casinos you wish to make it cost prohibitive for me and others to get in the game which would lessen your competition.
@BushDepression said "It would lead to a lot more computer jobs in NV...."
I disagree. Harrah's is already set for online gaming (from 2009): "Harrah's Interactive Entertainment announced today that it has signed a long-term contract with 888 Holdings Plc (888 on the London Stock Exchange) to provide online gaming services, support services, and payment software to the World Series of Poker and Caesars Casino brands in the UK." http://www.cardplayer.com/poker-news/752...
That said, it takes few people to run an IT department for several million customers and they can be located anywhere in the world. While Ms. Jones says, '...many sites employ thousands of workers who are needed to manage player accounts...This is a new industry that would come to Nevada...This would help us protect jobs and create new jobs.', Harrah's has already outsourced much of its IT department to Asia and the Pacific Rim.
You guys are really clueless.
Anybody can play for money at poker at big operations like Full Tilt Poker. They don't try to hide one thing.
There are big time betting operations like BetUs. They don't try to hide a thing, too.
The big shops have just figured out ways to people to send them money and to return money to players.
At Full Tilt all you need is a credit card.
Although strict licensing requirements in the USA could be reasonably enforced, I doubt that the "strict controls" promised on regulating the actual on-line gaming sites will be effective. Just look at problems sites like Facebook and Craigslist have had with underage users and illegal activity.
As far as I am concerned, on-line gaming will be ruinous for young Americans, who are too skilled in getting around internet rules to be caught.
Legalizing means...."officially collecting a piece of the cake" by taxing these online revenues. However, it is questionable if it works as taxed online sites can't offer the same than less or no taxed online sites with the exeception that perhaps you could track the cash flow and check the pseudo random generator if any case of a doubt.
Still, I don't think that the exisiting online sites would be so successful and big if they wouldn't be honest. Full Tilt and Stars are the 2 leaders in the market and what they can offer is terrific.
While preparing my next Vegas vacation I checked some casino websites for promotions and the best ones can only to a degree compete with what you get online. If the nightly promotions at the Hard Rock are still on and the Rio's poker room is also giving away triple comp dollars at nights, then it's an ok situation. Live poker is so much different than online, it's 2 worlds, but you got to love both to be a player of today.
From Switzerland
The whiners have apparently never heard of WSOP and the $$$ it brings to Las Vegas.
gbigs, I think they're trying to limit the licenses they give out, and states can opt in. So NV opts in, an online company is based here, they have to have their servers here, they have to hire people here, and they have to pay taxes here. that's the theory, and if that works out, I think it would be great for the economy. I'm not a huge supporter of the one trick pony, gaming based economy that we have, but the reality is that we have a lot of expertise in the area, at least this would bring in some technology jobs to the town. It sounds like it would generate huge business, so better to have them here, regulate, and collect tax revenue.
I still think we need to focus on diversifying our economy into non-gaming based industries, but like I said, we have a lot of expertise that we can probably leverage for this particular industry.
I disagree with Eureka, they could brand an internet casino that could explode their business higher. It doesn't take much to partner with an outfit that has everything they need. It just shows how clueless some casino operators are in Vegas. Hammerheads from the past unable to adapt to the future.
Big mistake, will cause many to lose it all without ever leaving the house. I'm not against gambling, I do it myself on occasion, at the casino, or an occasional sports pool at the office. But I know what I can (and can't) afford. Most of you do too. But it will cause financial ruin to thousands. I prefer real cards, out of a real deck, not the electronic, easy to rig type. Will there be any controls in place to avoid credit cards being maxed with no way to repay? Just my opinion.
A valid concern, Bakersfield. So many ideas on how to exploit the gambler and so little address on treatment of problem gamblers. With internet gambling, gamblers are anonymous and do not have to endure the public opinion of their actions. They can gamble themselves into total destruction, all in the privacy of their home.
Bakersfield/kenodave, I think it's great that you're concerned about the potential problems, but there's really only so much that we can police in this country. We're really all about personal freedoms. I agree that we have an obligation to protect people from themselves in some cases, but I think they've proposed max daily/monthly bets based on your credit limit, which is a good idea.
I think those are valid concerns, though. I just think there are ways to address them.
See, there are two markets:
a) You want to gamble and do not need to physically see your opponent... sounds a little like video poker slots, doesn't it?
b) You want to see who you are playing against... that leads us to casinos or the like.
A colleague of mine is into online poker (Texas Hold'em), I believe he has an account with FullTilt or some other big site. He told me that there are rewards, comps, tournaments, whatsoever. You buy and play for some kind of "points", but there's a fixed point-to-dollar ratio and you can have a payout at any time. He never had any (justified) problems.
Well, he dreams about coming to Vegas some day and play for "real".
So would some of you mind looking over your narrow event horizon? It's not always about "what good is in it for me/Vegas/Nevada NOW?"
Even though there might be no direct taxes, no direct benefits now, there may be other positive consequences in the wake.
Oh, and regarding Dirty Harry Reid and pushing for taxable jobs: The world will continue playing online poker with or without America. I doubt that any current "big" company will give a **** on that.
in order for vegas to make money from internet gambling it would come from advertising revenue and offering people the real life experience.
people will gamble even if it was illegal look at the prohibition time there was more alcohol than ever before, make something illegal people want it all the more..
WARNING!!! Has anyone ever tried to cash out your money from one of these online poker sites?? Guess what!! You will be in a big nightmare situation and printed below is what you can expect!!!!!!
Hello xxxxx,
>
> Your cashout has been placed on hold as we have determined that the funds
> you are cashing out originate from recent deposits made to your account. We
> are not implying any wrong doing but ask that you please explain the reason
> for cashing out these funds.
>
> Please be aware that if we do not receive a response from you within 30
> days, your cashout will be cancelled and your account frozen.
>
> We look forward to hearing from you.
>
> Kind regards,
>
> XXXXXXXX,
> xxxxx xxxxx Security
Hello xxxxx,
Thank you for your email.
As you understand as an online gaming site we have no other way of verifying our players details other than requesting for documentation that confirms their account details.
CONTINUED ON NEXT COMMENT, PLEASE OPEN AND READ FURTHER. I CAN ONLY WRITE SO MANY CHARACTERS AT A TIME.
gbigs You are not a mentally healthy man, just where do you urinate? Does Ensign have access to the same toilet as Reid while in Congress? I thought so. I'll bet Ensign had a much nicer toilet while growing up than Reid did. Another right wing nut job shooting off his illinformed mouth.
Please note that we have security procedures in place, which act as a preventive measure against fraud. This is both beneficial to us, and our players as it ensures their safety. The request for documents is used strictly for verification purposes to confirm account details, we do not mean to imply any wrongdoing.
You would find that this practice is standard across the board with other online gaming sites. In addition if I may highlight your account is not an isolated case, as we request this information on a daily basis from our players and rarely receive any complaints.
As per our terms and conditions you are also required to provide this information. Please see below for reference.
4.3. You agree that you are required to provide us with certain personal details about yourself (including details regarding your methods of payment) for the purpose of using the Service. Our control of the information provided by you shall be subject to our Privacy Policy.
Please be advised that, on occasion, we may be required to amend the terms of service. It is your responsibility to keep up to date with any changes made to the terms of service.
We understand your hesitation, however kindly note that the requested documentation is necessary for the reinstatement of the account. Also please note that you have to print out your verification form in order to fill it in manually.
We look forward to validating your information.
Regards,
xxxxxxxxx
xxxxx xxxxx Security Team
CONTINUE READING ON NEXT COMMENT.
Hello xxxxx,
Thank you for your email.
As you may already know, when you make a deposit via Instant eChecks, the
funds are immediately credited to your xxxxx xxxxx account. Note that these
funds can be withdrawn from your personal bank account anytime after a
successful deposit is completed. In some cases, for a number of reasons,
banks do not honor these deposits and a return is sent to us.
In order to reduce the number of echeck returns we receive, a new security
system has been implemented. Limits have been introduced in terms of the
number of transactions and dollar values of echeck deposits, which can be
made at any one time. All deposits are considered cleared in our system
after a waiting period of 10 calendar days from the date of your deposit,
even if the funds were withdrawn from your bank account before or after this
period.
You are able to spend the uncleared deposits at the tables, however you may
not cash out or request cash transfers, unless you have a balance that is
greater than the total of your uncleared echeck deposits. Any portion of
your balance that is more than the total of your uncleared deposits, may be
used normally including cashouts and transfers.
You currently have $300.00 in uncleared eChecks deposits and these funds
will clear on the 08/31/2010. Once they have cleared you will be able to
cashout any part of your balance.
Furthermore, if an Instant eChecks deposit is not honored by your bank, and
is returned as unpaid, other restrictions will apply to future echeck
deposits. These restrictions may include not having access to all or part of
your funds in your available balance; only until your current or future
echeck deposit(s) clear. Please consider these restrictions when depositing
via Instant eChecks and note that other deposit methods are not affected by
these limitations.Should you require further information on this matter, feel free to contact
us back.
Regards,
XXXXXX
xxxxx xxxxx Support Team
CONTINUE READING NEXT COMMENT
Hello XXXXX,
Thank you for your reply.
Your recent cashout has been cancelled and the funds returned to your XXXXX XXXXX account. You may continue to play with these funds at the tables.
There is no minimum or maximum amount which must be used at our tables, however, we do require that you use xxxxx xxxxx for its intended purpose which is Poker..
If you would still like to cashout, we ask that you please complete the form below.
We look forward to your reply.
Regards,
xxxxx
XXXXX XXXXX Security Team
More information about Security is available online at:
XXXXX XXXXX VERIFICATION FORM
_____________________________________________________________________
1. Please complete the following information:
______________________________________________
xxxxx xxxxx User ID
______________________________________________
Full Name
______________________________________________
Mailing Address
______________________________________________
Phone Number
______________________________________________
Email Address
-----------------------------------------------------------------------
2. I enclose the following information to support this application:
a) A clear photocopy of my valid ID card or passport
(front and back);
b) A clear photocopy of my most recent utility bill
(telephone, gas, water etc.) showing my name, address and
statement date;
c) Bank Routing Number _______________________
Bank Account Number _______________________
d) A clear photocopy of my most recent
statement for bank account listed above showing my name
address, and statement date.
-----------------------------------------------------------------------
3. By signing and submitting this form along with the accompanying
documentation, I am fully acknowledging and verifying the following:
a) The above details are valid and I am the owner of this
xxxxx xxxxx account;
b) I have authorized all transactions processed using my
Bank account and/or accounts listed above initiated
from my xxxxx xxxxx account;
c) I will honor all transactions made with the above
Bank account and/or account(s).
-----------------------------------------------------------------------
______________________________________________
Signature
______________________________________________
Date
Please scan this form and the requested documentation and send to: xxxxx xxxxx Security Team
ANYONE DUMB ENOUGH TO SEND THIS MUCH VITAL PERSONAL INFORMATION IN THE FORM OF AN EMAIL OUT INTO THE WORLD OF CYBERSPACE WILL SURLEY HAVE THERE BANK ACCOUNT WIPED OUT IN A HEARTBEAT!!
GOOD LUCK EVERYONE!! THEY MAKE IT SOOOOO EASY TO PUT YOUR MONEY IN TO THERE POKER SITE, BUT JUST TRY TO EVER CASH OUT!!
First - Unless I missed something - I can now make sportsbook wagers on my cell phone and is is approved here in Nevada with Leroy's.
Second - I am tired of Casino folks not adopting the internet as a way to connect with people when they can't be in Nevada - and to build brand loyalty - something that the Casinos really can't do all that well with the digital generation
SO PLEASE STOP SENDING ME MAIL I EITHER DON'T READ, FORGET TO BRING ALONG WITH ME, AND SEEMS TO GET TOSSED AWAY WITH THE OTHER HALF POUND OF PAPER DELIVERED TO ME EACH WEEK. Just another tidbit - Faceboook, Twitter, etc - last place I am going to go to for insight on Casino gaming - I am not joining your groups.
Third - Security - Casinos will be mandated to open web accounts in person or with verified customers - where they already have verified ID and Bank references. ......
Internet gaming - just makes life easier - and again to the Casinos - you have such happy and cheery people working in your Sports Book - If I wanted to deal with moody and impolite folks I can just stay home - lol.
I can now place a wager on my phone, or computer and get info I need about the Casino online - cool stuff - Currently I go to NEON to find out what is going on as I go online now to a cluttered website and little personalization - call my host which moves every week to a new casino or job - or just arrive to deal with Staff that fear the notion of a comp.
Which leads to my other comment about the Casinos and their 'technology'. I am a fairly well known technology pioneer - and I avoid doing business in Las Vegas because I live here and have worked on projects over the past 8 years and watched in amazement the marketing lack of ingenuity and technology infrastructure - I have spent time with Gaming Control who can't or won't ever understand technology.
However, as your market gets older, and more technology oriented Casinos need to morph. The great experiences of Vegas have gone the way of the Commodore 64 - though Casinos still use AS-400 computers of that era to run their operations.
My hope is Regulators and Vegas will realize that folks that want to gamble will find places to gamble - legal or otherwise.
I also hope that Vegas stops and looks at user experience because unless that changes - an old Windows 98 computer running casino games is certainly a better experience that the quality of service being generated at most Casinos I visit - I would welcome a comp for a dinner for wagering online more than dealing with a table or machine with smoking drunk and somewhat rude patrons - much less the staff that seems as interested in creating a fun atmosphere as making their next payment to a collection agency.
I am real concerned about this. Casinos are the backbone of jobs in this state. The big kahunas(men on boards of casinos)like Sands, Wynn, PPE, MGM, and others will do well but it will stop jobs. It will limit the corporations. I will probably put midrange casinos out of business like Boyd Group and Stations. They are having a hard time as it is. And those tech jobs, we are not trained for them. So are the big kahunas going to hire outside the state or country under K status? We don't have much of neighborhood gatherings as it is. These places offer that and some good entertainment too at decent prices. I like going to Sunset Station for the smooth jazz concerts, even though I don't gamble. That will be gone and all entertainment will be on the strip at prices I can't afford. What will the locals do to get out of the house? I accept change but at what price is this change coming?
@bringback
I would be interested which site you refer to with you marathon-post.
My colleague told me that his payout was simply transferred to his credit card without any hassle.
Maybe Internet gambling would be good competion for the Eureka Casino in Mesquite, Nevada. Attended a meeting for all employess and Greg Lee and his management team told us we shoud be modeling our lifes after Tiger Woods. Management sure knows how to pick their role models
yea payattention now you can reach pennylessness and achieve bankruptcy from the armchair of your home. Fantastic.
TomDE
I don't want to say there name outright on the internet, but I will say they are one of the biggest poker sites out there. All of those comments I made are of all the actual emails that they sent to me. At first they made it sound as though they just wanted to know the reason for me wanting to cash out so soon after only 2 days earlier I had deposited $300.00 I answered them back and told them my reason for no longer wanting to play on there site. I guess they did not like what I said to them and it must have pissed them off. First of all, it's none of there business why I wanted to cash out MY MONEY!! I put it in there and after only 2 days of play I lost 80.00 and had enough of this crap! When I summited my cashout request, they should have just put it back into my bank account as fast and as easy as they took it out! Now Tom just go look at all the crap that I have to go through to try and get MY MONEY back! If I was to send that much personal and vital information to anyone, my entire bank account could be wiped out in a quick second or two!! Especially sending it out into the world of cyberspace in the form of an email!! Do you agree Tom?
So Dirty Harry holds the keys. Hold on Nevada hope you have plenty of lube cause when Harrys done only MGM and the Saudis will be providing the service and it will kill the smaller operations. Gaming is dead long live gaming.
lol, wow, u people are like the us government, talking about all the ways to regulate and make money, talking about problem gamblers, then talking more about freaking jobs you wanna protect..or talking about how sniff sniff hard it is to send documentation to a poker site, roflmao.
The whole while, like the paid off government, all you can do is scheme for yourselves and not give a fig about the hundreds of thousands of online poker players THAT ALREADY EXIST. You ever heard of poker forums?
Online poker is alive and well. So legislate it, we would welcome that, be we are not going to welcome a bunch of back room deals where just a few control it all. Let me repeat, online poker is available to me 24/7, and cashout options are there. Have you guys ever heard of the Navaho Indians?????? They move my money to and from poker rooms pretty damn good. costs 10%, but legal
My point is, there are a ton of recreational poker players out there in the usa, that really could care less about harry reid or what you guys cook up, we just wanna play, and you know what, we can do that