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Non-Tech : Gambling, The Next Great Internet Industry -- Ignore unavailable to you. Want to Upgrade?

To: Herc who wrote (343)	4/15/2000 7:42:00 PM
From: Herc	Read Replies (1) \| Respond to of 827

From egamingstocks.com <<Uncertainty about the U.S. banning of online gaming is another major concern that keeps investors at arm's length. Last week, the House Judiciary Committee voted 21-8 to send the legislation to the full House. The measure would make most online betting illegal. It would impose a fine equal to the value of the bet or $20,000, whichever is greater, and a maximum four-year prison sentence. This is on the heels of the passage of the infamous Kyl Bill sponsored by Senator John Kyl (R-AZ), which passed the Senate last fall. On the surface, this looks quite discouraging to any investor having any thoughts about putting their money into this industry. Certainly, concerns are warranted, however, let us take a deeper look at what is actually happening here. Under the language of the House legislation, the bill seeks to ban online casinos, as opposed to online gambling. Furthermore, the prohibition seeks to ban online gaming establishments in the U.S., but does not and cannot ban their establishment outside of U.S. borders. Currently, the overwhelming majority of online casinos are NOT housed in the U.S., but are located in foreign jurisdictions such as Antiqua, Australia and other countries and states that license eGaming. The previous version of the bill sought to penalize gamblers with criminal prosecution, as well as hold Internet Service Providers liable for policing their hosted sites that promote or handle any gaming activity. This is not so under the recent House bill. What's more, fantasy league sports betting, pari-mutuel and state lotteries are not affected by this law. It is a bill as useless and as futile as 1920's Prohibition in that it is basically unenforceable. Last year, upon review of the Kyl Bill, the Justice Department stated that the provisions of the bill were unenforceable and that they did not think it wise to legislate in such a way concerning a medium as new and as far reaching as the Internet. Provisions of the Kyl Bill were seen as a threat to the development of the Internet. So, what does the law mean? It means that the eGaming companies will continue to operate as they are, namely, outside of U.S. jurisdiction. They are out of the reach of U.S. law. Furthermore, since the new bill takes the liability off of the ISP's to police their sites, online wagering will continue to grow- even with new people placing wagers from the U.S. It is the height of fallacious thinking to assume that anything related to the Internet will not grow. It is even further absurdity to think that the U.S. ban will effect an industry that is becoming worldwide. What will happen is that growth will be slowed and U.S. companies will lose out on the revenues. But if the money cannot come to them, they will go to where the money is. So, the potential market for eGaming may be stifled in the short term, but its current revenues will grow as other countries license and regulate it. Rep. Bob Goodlatte (R-Va.), the chief sponsor of the U.S. House bill has defended the legislation as a solid approach to "the serious and growing problem of online gambling". I must respectfully disagree with Rep. Goodlatte. This bill will do nothing to reduce the seriousness of unregulated gaming. Regardless, eGaming will continue and the real threat that will keep it a serious problem is that this seeks to negate the process of regulation and only allows the unscrupulous gaming operators to continue without detection. After all, the U.S. can do nothing to an off shore gaming site- especially if the off shore company is licensed to accept wagers in its jurisdiction. What is needed is regulation. This will protect the gamblers, the investors and will benefit states and governments with an enormous source of revenue. What's the real issue here? The real issue is, in fact, regulation. Due to the uncharted and untested waters of the Internet, too much money is at stake and there is no way for the government to regulate it in a way to guarantee its share of the revenue. There is no universal regulatory and accountability method that can be relied upon by the government- whereby they can get their share. Organizations such as the Interactive Gaming Council (IGC) and others are an enormous first step in an industry that is actually seeking to working amicably with governments. The legitimate gaming operators, that comprise a majority of the Internet Gaming companies, strongly desire to work with the governments. It is in their best interest to do so. The issue at hand is that the technology has surpassed the government's ability to regulate it. This is obvious when we look at the differences between the Kyl bill and the Goodlatte bill. When the Kyl bill was first drawn, it proposed a sweeping ban across the board for almost all Internet wagering. Since then, more than a year has passed since its birth. In that time, states and other gaming mediums have grown to where they can harness the technology necessary to assure a safe and regulated wagering process. Now, the legislation has caught up with the technology and we find that lotteries, pari-mutuels and other forms of wagering are excepted. It is this author's opinion that at the current rate, a comprehensive regulatory technology will soon be at hand allowing the government to switch its debate from prohibition to regulation.>>