Is US Online Poker Doomed Before It Can Even Begin?

29 August 2012


As if online poker didn’t have enough hurdles in its race towards becoming a legal US pastime, now it also has to beat the clock.

The window of opportunity that opened when the Federal Wire Act of 1961 was re-evaluated on December 23, 2011 may be closing, particularly because Congress has yet to make a decision on anything, let alone the federal regulation of online poker. Approaching elections compound the issue, as keeping a safe distance from a polarizing issue like online gambling will prevent turning off possible voters.

This lack of federal action leaves the States, who are hungry for revenue and resources, to fend for themselves. And if states are allowed to create their own, independent regulations, a unified system and interstate websites are unlikely. This has the casino operators some States, like Nevada, worried.

“We know some companies will shop for the lowest common denominator,” said Station Casinos Vice Chariman Lorenzo Fertitta in a recent Las Vegas Review Journal article. “We could start seeing bets being taken away from Nevada.”

Prior to the US Justice Department laying the hammer down on US online gambling in April 2011, US gamblers reportedly spent $26 billion every year on their favorite online poker and online casino games. Creating a way to reopen and tax that revenue proves to be something several states are interested in, and luring the right casino operators to the party may be just the way to do it.

The problem, of course, with state-by-state regulations is that licenses, and players, are restricted to in-state use. Casino operators in Nevada may be competing over the attention of customers, but they all agree on one thing: Online poker is good. State-by-state online casino gambling is bad. Fertitta goes on to say:

“We are sitting on our No. 1 economy based on bricks and mortar. Now, those betting tourists might stay home and spend a significant portion of their budget online. You think we just went through a bad economy over the last three years? That could be nothing compared to effect of full-blown Internet gaming on a state-by-state basis. That’s why we’re so focused on some kind of federal structure that would set ground rules. What we advocate is poker only.”

Nevada is leading the way for licensing legal US online poker rooms, but those companies–many who seek to launch this fall–will dry up in the shallow well of Nevada residents. A nationwide online poker player pool is necessary for online poker’s success, and that can be achieved only if the States follow a set and federal legislation.

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