In spite of recent measures attempting to limit online gambling financial transactions by U.S. players, American land-based casinos appear to be un-phased in their ambitions to penetrate the online gambling industry.

The $13 billion global online gambling market, of which approximately six billion dollars comes from U.S. residents, is no doubt great a incentive for the land-based casinos to get in on the action of online gambling and the fact that off-shore online gambling companies are becoming more and more reticent about allowing US residents to play at their sites is another compelling reason for their interest. If US based casinos are able to bring US politicians in line concerning online gambling policies, we could soon see online gambling legalized in the U.S.

In fact, American bricks and mortar casinos might actually feel encouraged by Senator Bill Frist’s latest online gambling legislation that passed the House and Senate because it does not specifically make it illegal to bet on online casino-style games, such as poker and blackjack. While the bill does bar financial institutions from accepting “illegal” bets, it does not spell out specifically whether some forms of online gambling are illegal or legal. So far, the only form of gambling explicitly outlawed is sports betting.

The American Gambling Association (AGA) took a neutral position on the bill even though some of its members, such as the MGM Mirage, have indicated that they would like to start their own online gambling sites. The AGA lobbies for the American land-based casino industry.

In a comment about the future of American-based online gambling sites, Frank Fahrenkopf, the CEO of the AGA, said that the organization believes that American casinos will eventually be allowed to open online sites, regulated by individual states or the federal government: “"This bill did not make anything legal or illegal," says Fahrenkopf. "What it did was affect the mechanism by which Internet gambling takes place…and there is some question as to whether or not that will be effective."

When it was suggested that a bi-partisan congressional commission be created for the purposes of studying and reporting on Internet gambling, the AGA expressed their support for the suggestion. Both Rep. Connors and Jon Porter, a Nevada Congressman, had originally proposed the idea for the commission, which would be established in orfrt to study whether online gambling sites, run by U.S. companies, could be effectively regulated. Fahrenkopf believes that the bill, which is backed by the land casino industry, will probably be considered some time early next year. Support for the bill is growing steadily.

"It is still Congressman Porter's intention to move ahead with this bill," says Trevor Kolego, the congressman's legislative director. "We hope to pass it, if not by the end of this session, then next session."

Posted on: October 5, 2006

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