Gambling via cell phone may be a stretch — for now

By Liz Benston

Thursday, Feb. 24, 2011 | 2 a.m.

Imagine gambling on digital blackjack on your smart phone while stuck in traffic in the Spaghetti Bowl or dropping money into a slot machine while doing 80 across a high-desert highway west of Ely.

This will be the newest face of legal gambling if one local company gets its way: playing the games anywhere in Nevada — even lounging in your backyard pool.

Cantor Gaming says it will press the Nevada Legislature this year to allow gambling using the same 21st century technology that surfs the Internet, sends e-mail, views movies and listens to music. It’s a big leap for a state that only recently allowed gamblers to use handheld gambling devices in select casinos. Gamblers may also bet remotely, but only on sporting events.

“People want to be able to (gamble) where and when they choose,” Wall Street veteran and Cantor Gaming CEO Lee Amaitis said.

Significant regulatory and political hurdles stand in his way, however.

Nevada law allows gamblers within the state’s borders to make sports bets remotely by setting up a casino account and downloading software onto a home computer, logging on by cell phone or by using a pager. Such gambling doesn’t violate federal prohibitions of Internet gambling because it occurs over a private wireless network rather than the World Wide Web and doesn’t cross state lines.

American Wagering, which operates the Leroy’s sports books, received regulatory approval last year for technology enabling gamblers in Nevada to make sports bets using BlackBerrys.

Applying that technology to casino games such as blackjack, slots and roulette is a relatively small leap for a company like Cantor. For regulators who must consider the business and social implications of new gambling technology, it’s a potential chasm.

“This would be a huge policy shift for the state,” Gaming Control Board Chairman Mark Lipparelli said.

He wouldn’t speculate on how casino regulators would receive the proposal, which would require the Legislature to change state law and secondary approval by gaming regulators, who must vet any new gambling technology.

Allowing gambling on mobile devices outside Nevada casinos could generate tax dollars the state desperately needs. But its potential concerns have yet to be considered by the business and political chieftains.

Do the big casino companies want customers gambling outside their resorts, away from other temptations to spend money, or, heaven forbid, at a competitor’s shopping mall or restaurant? And what of smaller casinos that lack the resources to adopt mobile gambling? Locals could more easily gamble in a big resort’s digital casino from their cell phones than get in their cars and drive to their neighborhood casinos.

“The politics are going to get difficult,” said Bill Eadington, director of UNR’s Institute for the Study of Gambling and Commercial Gaming. “This has the potential to redistribute wealth between companies in Nevada,” with larger companies and brands possibly benefiting at the expense of smaller casinos with lesser-known brands.

Cantor doesn’t have bricks-and-mortar casinos to worry about. The company is a high-tech maverick with its roots on Wall Street rather than the Strip, where technology lags behind that of other industries because of regulatory concerns about cheating, underage gambling and compulsive gambling.

The Las Vegas company is part of Cantor Fitzgerald, a global investment bank and brokerage firm that created the technology Wall Street firms use to trade Treasury bonds, stocks and other securities. In Britain, where sports betting is widespread, the company leveraged its expertise in real-time trading by developing algorithms that could produce odds for games in progress, allowing gamblers to bet on the outcome of individual plays seconds in advance, such as a soccer kick, basketball free throw or a touchdown pass.

Cantor’s lobbying efforts led to legislation in 2005 allowing the use of handheld gambling devices in specified areas of casinos. In 2008, Nevada regulators signed off on the technology, which included betting on sporting events in progress, called in-running.

Such gambling remains limited to casino areas approved by regulators.

A few casinos have signed on to use Cantor’s technology. Two, the Hard Rock and Tropicana, opened Cantor-operated sports books this month.

Amaitis said in-running technology has increased betting activity, creating jobs and tax revenue. At M Resort, Palazzo and Venetian, where it’s been offered since 2009, Amaitis said gamblers wagered $400 million using Cantor technology last year — 14 percent of the $2.8 billion wagered on sports statewide. Amaitis estimates that $300 million of that wouldn’t have been bet if not for in-running sports betting. The company’s handheld devices, marketed under the eDeck and Pocket Casino brands, aren’t widely used, however. That’s partly because casinos have limited their use to select zones, such as lounges near sports books, where fraud or underage gambling can more easily be prevented.

Casino-issued handhelds “will soon be doorstops” if regulators let people gamble on their phones, Amaitis said.

“Why are we allowing this with sports wagering and not casino games? It’s illogical,” he said.

With the impatience characteristic of a Wall Street securities trader, Amaitis is thinking several moves ahead, toward a future he said is as inevitable as smart phones or the Internet itself.

The company eventually wants to operate full-blown casinos on the Internet for Nevada bettors — a business opportunity Nevada’s gaming industry has avoided.

Instead, the state’s big casino companies have supported federal regulation of Internet poker. Those prospects don’t look good after Republicans, now in control of the House, last year shot down Nevada Sen. Harry Reid’s bill to have the Treasury Department regulate Internet poker.

Nevada’s biggest operators, MGM Resorts International and Caesars Entertainment, have little interest in limiting in-state mobile casino gambling — the only option available for Nevada in light of the Justice Department’s ban on Internet gambling. Nor do they approve of efforts by other states to legalize online gambling within their borders.

New Jersey lawmakers recently did just that to generate tax revenue, though Gov. Chris Christie has yet to sign it.

Some companies say Nevada’s population is too small to support Web casinos, while there’s no shortage of gambling opportunities here.

“The Internet, by its very nature, is an interstate activity,” said Jan Jones, senior vice president of communications and government relations for Caesars Entertainment. “There may be some small demand for (mobile) casino games in Nevada, but you don’t have the population base for a poker offering.”

Putting casino games at Nevadans’ fingertips also raises concerns about problem gambling in a state with a spotty record of treating gambling addicts. A study commissioned by the British government and released this month found that 0.9 percent of the population — less than initially feared and a statistically insignificant increase from 2007 — are considered problem gamblers years after the spread of Internet and mobile phone gambling in the United Kingdom.

These statistics don’t necessarily translate in Nevada, which has its own gambling culture, though they might indicate such fears are overblown, said Bo Bernhard, a sociology professor and director of gambling research at UNLV’s International Gaming Institute.

As the rest of the world goes mobile, the industry’s capital should change with it or be left behind, Amaitis said.