Panel Optimistic About Online Gaming's Future

LOS ANGELES, California – (PRESS RELEASE) -- In the fourth in a series of summit meetings held here Friday, a panel of experts agreed that although consumers will have to wait for regulation of online gambling, and for laws to offer them basic protections, there is reason to be encouraged. Although moves at the federal level are complicating the process -- most notably an effort last week to attach a bill prohibiting online gambling to anti-terrorism legislation -- the panel expected that when it comes to gambling law it's the state governments which always have, and likely will, find the ultimate solution.

Mark Balestra, vice president of River City Group and editor of Interactive Gaming News said there are already several models for how Internet gambling can be successfully regulated at the state level, including inter- state wagering on regional lotteries and para-mutual gambling.

Today's panel, which followed similar summit meetings on the topic in Chicago last Tuesday, and in the prior week, Washington D.C. and New York, was hosted by BETonSPORTS plc, operator of the world's largest online wagering service. The summits are part of a national public policy initiative called "Proposition 1: To Regulate or Prohibit Online Gambling." It will lead to the publishing of a white paper on the subject later this year and is accompanied by an upcoming series of college campus debates and a national advertising campaign.

Also joining the panel was David Schwartz, coordinator of the Gaming Studies Research Center, University of Nevada at Las Vegas. He discussed the history of gaming legislation in the U.S. as a backdrop to the current debate over Internet gambling. He too was encouraged that regulation was inevitable.

"If history is any judge, BETonSPORTS is on the winning side of this issue. Gambling has been around for thousands of years and has always adapted to new technology."

All panel members pointed to the growing popularity of online poker, coupled with television poker tournaments, as an example of how Americans are embracing gambling as entertainment and "voting" for online gambling through their actions - despite the fact that in the eyes of the Department of Justice what millions of American are doing every day on their computers is "technically" breaking the law.

Still, the panel acknowledged that the road to regulation will be bumpy. Numerous issues have to be resolved, beginning with federal law enforcement authorities and regulators working more cooperatively with the states to support their approach to the solution. The role of technology in affording consumer protections -- such as ensuring that minors don't play online -- must also be better defined. But of greatest immediate concern was last week's attempt by Rep. Michael Oxley, R-Ohio, to add H.R. 2143, the Unlawful Internet Gambling Funding Prohibition Act, to an anti-terrorism bill in committee, a matter which will be discussed in hearings on September 29.

Said David Carruthers, CEO of BETonSPORTS: "Connecting this issue to a bill as important as that trivializes the dire need in this country to fight terrorism. That is neither a sensible approach to protecting consumers nor a constructive one."

Americans wager upwards of $100 billion a year on sports on the "street" and on college campuses, according to Carruthers. Online gambling is estimated to be a $10 billion market today and is growing exponentially. "People are going to gamble online whatever happens in Washington," added Carruthers. "Prohibition won't stop people from engaging in this form of entertainment."

Several common themes arose through the four summits and together they'll help create the basis for a public policy framework that BETonSPORTS hopes to build support for in the coming months. Panelists at the New York summit hoped that the Department of Justice would rethink enforcement activities that have been "haphazard and not really effective," according to Linda Goldstein, an attorney with Manatt, Phelps and Philips LLP. A former New Jersey gaming official, Frank Catania, said that online gaming companies can be subject to the same probity checks as land-based operations, a practice well established in several states.

In Washington D.C., the panel members called for regulation to promote "responsible gaming" online and that this is an opportunity to "exceed current land-based responsible gaming practices" according to Keith Whyte, executive director of the National Council on Problem Gaming. And in Chicago last week, the experts pointed to the windfall in tax revenues states will be able to realize with sensible regulation of the industry.

Concluded BETonSPORTS' Carruthers: "Regulation of online gambling is right for the consumer, the operator and the government. Our hope is that by bringing attention to these issues we have advanced the national discourse on online gambling and helped resolve differences of opinion and approach. There's a public policy vacuum at the center of this debate because the actions so far by the federal government have polarized people. We'll fill that vacuum with industry leadership, public private partnerships and popular support."

College Debates

BETonSPORTS will host a series of debates that tackle the issues surrounding the growth and proliferation of online gambling on college campuses -- from whether "responsible gambling" is a contradiction in terms, to exploration of the ethical issues of student-athletes wagering on collegiate games. Students make up a growing part of the online gambling market and yet they have not been actively engaged on the issues, let alone discussion on what constitutes responsible online gambling. Moreover, according to the NCAA, gambling by student-athletes is occurring at a "startling" rate. As students continue to use the Internet for gambling, these debates will help them become better informed on the issues, understand responsible gambling, and have an impact on public policy-making.