The year 1999 was the biggest yet for interactive gaming (as was '98, as was '97, and so on); and 2000 promises to be even bigger. Following is a regional rundown of stuff to look forward to in the coming year, as well as a few predictions.
Prohibition 2000 - What's in store for federal prohibition legislation? Will the Kyl and Goodlatte bills finally become a law? If so, will it include an exemption for horse racing? Fantasy sports? Lotteries? Indian gaming? Will ISP's shoulder the weight of enforcement? What about advertising? Will land-based casino companies form a lobby?
Kyl's Last Stand? - Will the Internet Gaming Prohibition Act be Jon Kyl's last dance? The Arizona senator's term is coming to an end and his approval ratings were low in '99. Will he survive the 2000 election?
The Ongoing Starnet Saga - What's in store for Net betting's favorite magnet for controversy? Your guess is as good as mine, but I guarantee they'll find their way into the headlines. Heading into the new year, several issues--the RCMP investigation, the class action suits, the Las Vegas Casinos dispute, a floundering stock--remain unresolved.
The Jay Cohen Trial - Will there ever be a trial? Twenty-one sportsbook operators were on the receiving end of criminal complaints filed by the U.S. Attorney for the Southern District of New York in 1998. Some have settled, some have gotten off the hook and some are fugitives. World Sports Exchange's Jay Cohen, on the other hand, chose to fight it out in court. Prosecutors, seemingly less eager to battle, have continually pushed back the trial date. Circle February 14 as the big day, but don't be surprised if it's postponed again.
Credit Betting - It's an international issue, but credit card policies are being driven by events in the U.S., namely the California lawsuits. You can bank on a lot happening in this arena in 2000. The question of whether credit betting will survive could be ultimately answered in coming months.
Raids, Raids and More Raids - It was surely a popular year for raids and investigations in North America, but none of them seemed to result in anything. Will their be any closure in the Youbet.com, Starnet and Handa Lopez investigations? And more importantly, who's next?
The Nevada Climate - Over the past four years, the big gaming corporations have steadily inched closer to pouncing on the Internet market. Convergence seemed inevitable until the Nevada State Gaming Control Board put its foot down in December. The playing out of the Board's complaint against American Wagering promises to be a hot story in early 2000.
Interactive Race Wagering - Assuming that interactive race wagering is deemed legal-by no means a gimme--one of 2000's most interesting stories to follow will be the race for market dominance between TrackPower, You Bet, Television Games Network and the Racing Network. You Bet was on top of the world in '99, but it's been set back by investigations into the legality of closed-loop race betting in California. The latest emergence, TrackPower, plans to flip the Internet switch in January. TVG and TRN are heading in that direction as well. Will a new player come onto the scene?
Australia has established itself as a leader in legislating successful avenues for online gambling. While the rest of the world remained divided between abolishment and anarchy, the Australian states, led by Queensland, introduced stringent regulatory models that seemed like the perfect answer. But will Australia stay on top in 2000? The arrival of the Kahnawake Mohawk's tax-free model in Canada means big-time competition. Additionally, South Africa and Liberia will likely facilitate highly regulated online gambling in the coming year. Plus, Antigua is leading the way in bringing the Caribbean jurisdictions up to speed in terms of player protection. All this means that Australia will be forced to consider cutting tax rates dramatically to stay in the game. The debate is sure to heat up in 2000.
In the immediate future, the big question is: Who will succeed Lasseters as the second licensed online casino to go live Down Under? GoCorp, consumed in a major scandal in '99, could be the one. The company has contracts with casino operators in both Tasmania and Queensland.
Meanwhile, the country which led the world in laughter over the push for prohibition in the U.S., is looking at similar efforts from within. Prime Minister John Howard wants the country to strongly consider prohibition on a federal level, a stance the doesn't sit well with state regulators. Prohibition in Australia, though highly unlikely, should be an interesting issue to follow in coming months
|The United Kingdom|
It's looking more and more like 2000 will be a definitive year in the U.K. The big three bookmakers-- Ladbrokes, William Hill and Coral--are in the immediate spotlight. William Hill got its foot in the door first, but Ladbrokes and Coral will likely go live in 2000. The big issue, however, isn't how the three will compete with each other; it's how they'll compete with companies that operate exclusively online. Because the big three have land-based businesses in Great Britain, it won't be so easy for them to escape taxes by going offshore. The U.K. Treasury Department is intent on taking additional tax money from bookmakers' land-based operations to compensate for tax money it can't collect from offshore operations.
Online gambling could extend beyond sports and race betting in the U.K. in coming months as well. The Gaming Board in Great Britain is looking into the legalization of online casinos and the British National Lottery, depending on who wins the next contract, could be Internet-bound too.
One of 1999's most exciting stories was the country of Liberia's arrival on the Internet gambling scene. The Gaming Board announced plans in October to create the world's first entirely government-operated online gambling destination. It's currently going through the due diligence with potential partners, and a decision on a software provider is expected to be announced February 14.
Moving to the southern tip of the continent, South Africa is considering legislation that would legalize online gambling. The regulatory model resembles those in Australia, however, South Africa takes a federal rather than a state approach. Further, the tax rates would be lower than the tax rates in Australia. If a law is passed in 2000, look for its enactment to come later in the year.
Keep a close eye on activities in Antigua and Barbuda, where reform is inevitable. The country is seeking to continue leading the way in the Caribbean by introducing tighter regulations which include software audits, a minimum return rule and possibly even a small tax. The Antigua Sun reported that droves of operators have threatened to leave if a tax is imposed, but the government insists that this is not the case. Legislation is being drafted and should surface in coming months.
Elsewhere, additional jurisdictions are vying for Antigua's position as the online gambling hotbed of the Caribbean. Dominica has tightened its approach and has weeded out some of its less desirable operators. On the mainland, Belize aims to become a major hub via outstanding facilities and its Export Processing Zone.
Finally, I offer a few predictions for the coming year:
- President Clinton will attempt to divert America's attention from his next major scandal by hiring a Hollywood film producer to stage a bogus military conflict--complete with film clips and the whole nine yards--with the country of Antigua and Barbuda. The reason behind the made-up bombings will be Antigua's poisoning of American youth by allowing its businesses to provide unlimited access to Internet gambling websites.
- Starnet will add to its ever-expanding staff a department of 300 explorers that will discover a new island off the coast of Antarctica. Shortly thereafter, the company will draft legislation declaring the 15 square mile hunk of land--named "Ellis Island" in honor of its chairman, Meldon Ellis--a tax-free online gambling jurisdiction. All 400,000 of the company's licensees will set up shop on the island, which will consist of one giant telecommunications facility and some bathrooms.
- A 12-year-old boy in Wyoming will log onto the Net and win $300,000 playing Pai Gow using his parents' credit card. The family will sue the credit card company, the issuing bank, the ISP, the operators of the site, the site's software providers, the phone company, the state of Wyoming, the entire Dominican Republic, Yahoo, Microsoft and the entire faculty at the child's school. They'll settle out of court with each defendant for an undisclosed amount of money. The family will also get to keep the $300,000 dollars.
- The Australian states (with the exception of South Australia) will unify to wage a war against the federal government in response to the federal government's infringements on their rights to regulate gambling as they wish. This war, however, won't be fought in the trenches; it'll be fought in the statehouses. And instead of going after each other with guns and missiles, each side will send its staunchest bureaucrats to the line to deliver longwinded speeches in an effort to bore their opponents to death. Casualties will be devastating. It'll go down as one of history's ugliest chapters. On a side note, the TABs will have the state governments favored at 5-2.
- British bookmaker Victor Chandler International will win a landmark EU court case maintaining its write to advertise via sky writing. Sadly, a sky writer will later lose his life in a crash in which he runs out of fuel while trying to write "http://www.victorchandler.com."
What do you think were the most significant online gambling events or issues of 1999? Any predictions for 2000? Tell us.