A Very Soft Launch for MGM Mirage

27 September 2002

With the outlook for Internet gambling growing increasing grim in its home country virtually by the hour, Vegas-based casino giant MGM Mirage quietly launched its highly anticipated online casino Thursday from an offshore location.

The new site, PlayMGMMirage.com, began accepting real-money betting on virtual casino games at 9 a.m. GMT. The launch came with no formal announcement. It's the fourth online casino to go live out of the Isle of Man.

MGM Mirage is the first Las Vegas-based casino company to operate a real-money online casino.

Senior Vice President of public Affairs Alan Feldman said the soft launch has gone smoothly, although not all the games are up and running. Feldman said the company aims do an official launch in 30 to 40 days. Traffic has been very light, so far, which, he said, gives them "an opportunity to watch the security matrix in action."

MGM Mirage's first foray into the Internet space came in late 2000 when it announced a partnership with gambling software supplier WagerWorks. That led to the launch of a free-play, MGM Mirage-branded online casino in February 2001. A combination of the free-play site and frequent pro-Internet-gambling rhetoric from Chairman Terri Lanni made the company a likely candidate to be the first Vegas-based operator to break into the Internet market.

Unwilling to wait for reluctant policymakers in Nevada to authorize Net betting, the company sought licensing elsewhere and obtained a license in the Isle of Man in September 2001.

Nevada has shown an interest in regulating Internet gambling and took the initial step of passing a law authorizing online casinos (but only if certain conditions were met) in June 2001. The charge lost momentum, however, when Nevada Gaming Commission Chairman Brian Sandoval, a key player in the pro-regulation movement, stepped down from his position.

Then in August 2002, the U.S. Department of Justice answered the Nevada Gaming Commission's request for an opinion on Internet casinos by stating that online casino gambling is a violation of the Federal Wire act.

The Department of Justice's opinion, along with a recent push in the U.S. House to move Rep. James Leach's, R-Iowa, Internet gambling funding prohibition act, has all but put the nail in the coffin for Nevada-based online gambling in the near future.

With an interest in preserving its good standing in jurisdictions where it operates land-based facilities, MGM Mirage has maintained from the start of its Internet venture that it will only accept bets from players in jurisdictions where online gambling is legal.

Feldman said the company is taking a very conservative approach and is accepting play from only a handful of countries, including the United Kingdom, Ireland, Spain and parts of Scandinavia.

Mark Balestra

Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.