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Howard Stutz
Big push for poker from big gaming
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A few years ago, top executives inside Nevada's casino industry wouldn't utter the words "online" and "poker" in the same sentence.
That's no longer the case.
Big gaming is firmly committed to seeing Congress pass an Internet poker bill that would legalize the activity, provide a strict regulatory system and a framework for taxing revenues.
That's partly what last week's pairing of MGM Resorts International and Boyd Gaming Corp., with Bwin.party, a European online gaming giant, was meant to convey.
A target audience for the MGM Resorts-Boyd announcement was influential lawmakers in Washington, D.C.
Conceivably, MGM and Boyd -- individually -- could operate multiple Internet poker websites under their various casino brands using Bwin.party's technology and online gaming platforms. Together, the three companies plan to launch a U.S. version of Bwin.party's PartyPoker, one of the world's largest online poker networks.
But without Congress approving a bill to legalize Internet poker, the agreements aren't worth much more than the paper they're printed on.
"We think there is positive momentum in Congress toward passing a bill," MGM Resorts Chairman Jim Murren said. "It's time for the federal government to address this issue."
Caesars Entertainment Corp. Chairman Gary Loveman couldn't have said it better. For years, Loveman was the lone voice in the industry favoring Internet poker, due in large part to his company's ownership of the World Series of Poker.
Now, with Murren, Boyd Gaming Chief Executive Officer Keith Smith, Donald Trump, the Fertitta brothers and others lending their support, Loveman and American Gaming Association President Frank Fahrenkopf Jr. have some added public muscle.
Murren and his Strip colleagues realized that Americans continued to play Internet poker despite two different moves by the federal government to curtail the activity.
In 2006, the Unlawful Internet Gambling Enforcement Act banned credit card companies and banks from transacting with online casinos.
In April, prosecutors from the U.S. Justice Department charged the owners of three of the largest online poker companies with money laundering and bank fraud, and cut off the websites' access to American customers.
In both instances, gamblers still found ways to play.
"Millions of U.S. citizens continue to risk billions of dollars at unregulated illegal websites," Murren said. "It can't be wished away. We support the need for regulation and consumer protection for online poker."
By framing the debate as a law enforcement issue, the casino industry could win a public relations battle.
The message? Shut down unregulated poker websites that are skirting the law and replace them with companies that embrace regulation and fair play -- in other words, the major casino operators.
"We are the most heavily regulated industry in the county," Smith said. "We have high standards. We deal with regulations on a daily basis."
Analysts believe Americans wager between $3 billion and $5 billion annually on Internet poker, money that flows away from the United States and into the hands of foreign online companies. Of course, getting their piece of the action is also driving big gaming's interest.
Arguments for strict regulation and enforcement, however, play well inside the Beltway.
In September, the American Gaming Association, the industry's Washington, D.C., lobbying organization, formally endorsed legalizing Internet poker.
The message? U.S. consumers need protection from illegal online gambling operators.
Two months ago, Senate Majority Leader Harry Reid, who tried to push Internet poker legislation though Congress last December during the lame duck session, thought the issue would come up before the end of the year.
During a house subcommittee hearing last month on an Internet poker bill, the panel's chairwoman, Rep. Mary Bono Mack, R-Calif., suggested that Congress slow down in considering legalization.
Insiders thought Bono Mack, whose district contains several large Indian casinos, was taking her cues from the influential tribes, which would prefer a state-by-state solution to Internet poker.
Big gaming's push in Washington, D.C., could face resistance from the tribal casinos and from the nation's lottery industry.
The message, however? Technology that operates online poker systems has evolved enough to ensure a game's integrity, protect player accounts and information, keep underage gamblers from logging into the system and address compulsive gambling.
Loveman, Fahrenkopf, Murren, Smith, would welcome more voices to the cause.
Howard Stutz's Inside Gaming column appears Sundays. He can be reached at hstutz@reviewjournal.com or 702-477-3871. He blogs at lvrj.com/blogs/stutz. Follow @howardstutz on Twitter.
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PPS: There's a second item that Stutz has gotten wrong in every single story he has ever written on this topic (several dozen). The US government did NOT cut off American players' access to the indicted sites. Not for one single minute. Online poker is not played through a website-based, browser-based interface. The software connects to their server independently of their web page. Play never stopped. The fact that Stutz still can't get this right many months later and that he can't get the effective date of UIGEA right many months later calls everything he writes into question. Evidently he's just not a very good reporter. Fact checking is beyond his skill set.
It's completely legal to play poker online. UIGEA only controls what banks and credit card companies can do, not what players can do. PS: Most stories (like this one) fail to note that while UIGEA was passed in 2006, it didn't take effect until 6/1/2010.
Internet gambling is already legal. The federal government and most people don't know that. If the company is licensed and chartered in a sovereign jurisdiction, the US has no authority whatsoever over how that company does business or who they accept bets from. The UIGEA never should have been passed and it should be repealled immediately. Millions of people will continue to bet with these offshore companies so the United States will continue to lose jobs and tax revenue because they have their heads in the sand.
Not going to happen this time around boys. 10 to 1 Harry has a lot on his plate today, next year, need more money from his friend Gary Lovechecks