Jon, just checked out the website of X-Stream's newest partner, Blue Square. You British guys are wild. I can't believe you can make legal wagers on the year end closing prices of stocks over there. I thought the odds on Dixons was quite interesting.
It was also good to see the X-Stream news up on the Blue Square site.
Seems this is mostly sports related betting but what about casino type on-line wagering? Is this type of on line gambling legal in Britain? There are any number of websites out there doing it and following is an article on what's happening in Australia on this. Seems a natural extension of X-Stream's service to include this type of wagering as well since they have already taken the first step with Blue Square. Best regards, Jeff
bluesq.com
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Australian Gaming Companies Set to Win on $10 Billion Online Betting Boom
By Richard Noonan
Australian Gaming Companies Set to Win on Online Betting Boom
Melbourne, July 20 (Bloomberg) -- Australia's largest gaming
companies are moving quickly to establish global online gambling
sites to take advantage of a market growing faster than
traditional gaming businesses and estimated to reach $10 billion
by 2001.
''The worldwide Internet gambling market looks set to
boom,'' said Paul Facey, an analyst at Merrill Lynch, in a
report. ''Following the expected ban on Internet gambling in the
U.S., Australian gambling companies appear well-positioned to
become the dominant players in the industry.''
Australia is one of the first countries in the world to
allow Internet gaming, giving those companies setting up
businesses access to over 140 million people around the world
connected online.
Companies such as Publishing & Broadcasting Ltd.'s Crown,
Star City Holdings Ltd., Jupiters Ltd., TAB Ltd. and Tabcorp
Holdings Ltd. have the potential to become the dominant players
in the market, analysts said.
Australia's attitude contrasts with that of the U.S., where
it's illegal, giving Australian operators the chance to steal a
march on their larger U.S. competitors.
Last month, a U.S. Senate Judiciary Committee voted to ban
sports and casino gambling over the Internet. A U.S. study said
the number of online gamblers more than doubled to 14.5 million
from 1997 to 1998, and Internet gambling revenue is expected to
rise from about A$300 million (US$195 million) in 1997 to $10
billion by 2001.
Strict Regulations
In Australia, both Queensland state and the Northern
Territory have passed laws allowing companies to operate Internet
gaming, so long as they comply with strict regulations, and the
operators pass probity tests. Other states, including Australia's
two most populous states New South Wales and Victoria, are
expected to follow shortly.
Internet research firm www.consult said there are 10 legal
and regulated gaming and betting sites in Australia. It said the
majority of the world's 2000 gambling sites are located in the
Caribbean, licensed by local governments and largely unregulated.
Jupiters' sports betting agency, Centrebet, said its revenue
has surged to A$120 million on the back of increased betting from
its online overseas clients.
''We're in constant contact with both gamblers and betting
outlets from many parts of the world and they're very impressed
with the way it's run and regulated here,'' said Gerard Duffy,
Sports Betting Manager at Centrebet.
''They want to bet where they know they're going to get paid
if they win, which is part of the reason why we we've now got so
many interested parties trying to obtain licenses in this
country.''
Another betting company SportsOdds launched an online
betting site two weeks ago and has already seen a 10 percent
shift from its traditional phone betting to Internet betting.
Licenses
Jupiters, Australia's largest casino company, wants to set
up an online gaming business, along with Star City and PBL's
Crown Casino, Australia's two largest casinos. These companies
are waiting for state government licenses.
Australia's biggest wagering companies are also moving
online. TAB and government controlled Queensland TAB both have
Internet wagering sites, and Tabcorp plans to have a site
operational by the end of the year. Closely held Tattersalls, one
of Australia's two largest slot machine operators, is planning to
join them.
In April, one of Australia's smallest casinos, Lasseters,
which is based in the outback town of Alice Springs, opened
Australia's first regulated Internet casino -- believed to be the
world's first physical casino to operate an online business.
Australians alone -- among the world's most active gamblers
-- could provide a lucrative business for the nation's gambling
companies, which generated A$1.5 billion in profit last year.
The nation's gamblers lost about A$11 billion on betting
last year, while about one-fifth of households have access to the
Internet and account for about 4 percent of the world's Internet
users.
Stuart Jackson, an analyst at Ord Minnett, said in a report
the focus of online operators will be on the larger international
markets, with governments likely to encourage this through lower
tax rates.
Large Market
Jackson said the overall market will be large, though he
said the potential for interactive gaming to add to shareholder
value is difficult to assess because of the high level of
competition and low barriers to entry.
Online operations will remain loss-making for a number of
years because of international marketing expenses, he said.
Expenditure on Internet gambling also has the potential to
''cannibalize'' traditional gaming businesses.
Merrill Lynch's Facey said the online market is expected to
grow slowly but steadily as the Internet becomes more pervasive
and consumers become more comfortable with making e-commerce
transactions.
He said the largest boost to online gambling will occur with
the expected convergence of the Internet and digital television
mediums. Still, he said online gambling is unlikely to generate
more income than traditional land-based gambling.
''Consumers will always crave the 'out-of-home'
entertainment experience and social interaction. However, we
believe Internet gambling is likely to become an important
earnings adjunct to a number of the major gambling companies.''
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