From the Editor's Chair - v14

13 April 2004

On the gambling front, there are too many recommendations in the United Kingdom and not enough action. The Budd Report came out in 2001 with 176 recommendations and was hailed as the roadmap for the future of gambling in England. Now, three years, hundreds of hours of testimony and 139 recommendations later, we have. . . well. . . another roadmap (albeit a revised one). This is the same slow process we saw in the United States with the government and public sector studies in the late '90s and in Australia with its series of inquiries afterward. And this is why offshore jurisdictions are still better suited for online gambling businesses.

Speaking of which, will Malta become the new hotspot? The country, which has been on a mission for a few years to become an I-gaming hub, just released its new licensing scheme to the public. It hasn't been approved yet, but if and when it goes through, they might be in a good position to scoop up some of the operators leaving other jurisdictions. A few things bode well for Malta: First, they're looking beyond the MGMs and Ranks of the world to seek "second-tier" operators, a much larger, more realistic market. Second, they have created a licensing system allowing for just about all types of gambling, including betting exchanges. Third, at US$8,700 a year, they're priced competitively. They're obviously looking to bring in a large amount of operators. One notable oddity: they're issuing licenses to companies that advertise online gambling services, as well as companies that host them.

The worlds of sumo wrestling and online gambling will finally collide May 19 in Toronto at the Global Interactive Gaming Summit & Expo. River City Group (publishers of IGN) announced April 1 that industry rivals will face of in the ring (wearing oversized puffy sumo outfits) at the First Annual GIGSE Sumo Grudge Matches. No, it's not an April Fools gag; it's really going to happen, and it will hopefully raise a lot of money for responsible gambling research. Delegates can wager play money on the matches and will be encouraged to donate to GamCare, Check it out on the Web if you want to get involved.

It wouldn't be an "Editor's Chair" column without a comment or two on the insanely fascist crackdown on advertising. The word on the street is that Raymond Gruender is very likely to be appointed as a judge, which means, he would ultimately have to walk away from his anti-I-gaming mission. That could be good news for the industry, but it's not as rosy as it may seem. He probably won't be promoted in the near future (certainly not within the next six months). And there's always the chance that his successor will be glad to take the keys to the crusade-mobile. Nevertheless, it's something to keep an eye on. published an article last week on the crackdown, and it is evident that the writer, Jacob Sullum, did something that we rarely see in the U.S. mainstream press's coverage of interactive gambling: It appears that he actually took the time to study and understand the topic. The article, "Is talking about online gambling illegal?", suggests what has been painfully obvious to many in the I-gaming circle since this nonsense began: Abolishing online gambling ads would conflict with the terms of the First Amendment to the Constitution. My favorite quote from the article comes from DoJ spokesman Michael Kulstad, who appropriately summarized the campaign: "There is concern that gambling advertising may create the impression among the public that these activities are legal, when in fact they are not." Kulstad told CNN. "It's an 'aiding and abetting' kind of thing." A keyword search within the U.S. Penal Code using the term "aiding and abetting kind of thing" produced no results.

In a slightly related matter, the recent indictment of several Florida-based touts for their relationships with online sports book is particularly alarming for two reasons. First, the news brought attention to a pending class action suit (against the some of the defendants) that could bring the advertising battle into the civil courts. The attorney representing the class told IGN Friday that they would consider "targeting the radio stations that placed their ads, and even potentially some of the attorneys who were involved in drafting the mechanisms to manipulate the system." Second, the complaints allege that the indicted individuals were involved in a scam operation. One might conclude that the situation supports the argument for regulation, but it won't be seen that way in Washington. On the contrary, the prohibition camp will argue that this case is precisely why the United States needs to pass a prohibition bill, and those who are on the fence could become more sympathetic to their cause. Crimes with victims are good for Kyl's campaign.

Speaking of prohibition, we're hearing some concerns these days that the WTO ruling against the United States will intensify efforts from the Team Kyl. But is that necessarily a bad thing? He's going to bring the bill back regardless. Why not force him to play his hand?

And finally, a proud moment for IGN. . . On April 5, we posted our 5,000th article. I don't think there are many publications specializing in online gambling that can say that. As a matter of fact, I'll go out on a limb and say we're the only one. We look forward to bringing you the next 5,000.

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.