Seeing an opening in the developing market of Nevada, a traditional bricks-and-mortar company has entered into a partnership with an experienced Internet gaming firm to form an alliance that both parties hope will given them a leg up on the competition.
Innovative Gaming Corporation of America, a Level 3 Slot machine manufacturer and GET Holdings/Gaming & Entertainment Technology (GET), an Australia-based computer technology company that specializes in developing Internet gaming systems, have entered into a full partnership and hope to jointly develop an Internet casino system that will satisfy U.S. regulators in both Nevada and New Jersey.
The joint venture will be tasked to the staged development of products for the gaming industry that combine the IGCA proprietary operating system with the games and back-end server-based technology developed by GET. The joint venture and its products are subject to licensing and other regulatory approvals.
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"Because of our status and licenses in Nevada and elsewhere, we have to be highly compliant with what we propose and with what we do," he said. "It gives us a great opportunity to talk to the regulators and to definitively help develop the standards for this."
- Steve Peterson, Xertain
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Steve Peterson, president of Xertain, the IGCA subsidiary that develops slot machines, told IGN that the deal would help his company venture into a genre in which it has very little.
"GET software was incorporated in the one jurisdiction (Australia) where it was legal for a couple of years," he said. "Since we have had some legislative relief from Nevada, and we feel it is coming from New Jersey, we felt like this was a technology we needed to be aware of and help."
Under the agreement, Peterson said, the two sides would openly exchange ideas and technology in hopes of developing a superior product.
"What we have done is set up a joint venture to swap technology and somehow get an introductory approach to where we could actually get some of this product to the market place under today's standards and then develop it further," he said.
IGCA had been looking for an online gaming partner, but found only one that was on good legal footing, according to Peterson.
"The problem with most Internet gaming companies is that most of them have taken bets illegally, but they (GET) haven't," he said. "So we are able to do business with them."
The biggest challenge for regulators and technology companies in implementing online gaming in the United States is the ability to block gamblers from jurisdictions where the activity is outlawed. GET has already developed such a system for use in Australia.
Peterson admits that blocking bettors from jurisdictions is a big roadblock, but he feels the partnership with his company and GET will open many doors which were previously closed.
"That technology needs to be discovered and implemented from their side," he said. "I don't think there is anything right now that is an enabler for that. In order for us to do this legally in any of these jurisdictions in the United States, we are going to have to provide that technology."
Peterson said his company has explored border-control options, but he wouldn't disclose details.
"We have some ideas, but I would prefer not to talk about that at this time," he said. "This is a joint venture between a Class 3 slot machine manufacturer that is legal in Nevada and around the country and an Internet gaming company that has maintained their status as a legal operator of Internet games."
Just like GET had all of its bases covered in Australia, Peterson said IGCA will protect its land-based operations by making sure the proper steps are taken while exploring the U.S. market.
"Because of our status and licenses in Nevada and elsewhere, we have to be highly compliant with what we propose and with what we do," he said. "It gives us a great opportunity to talk to the regulators and to definitively help develop the standards for this."
Peterson didn't give a date for rolling out the joint venture's new technology, but he said the companies will be ready once gaming commissions from various states have the proper standards and procedures in place. Experts predict that Nevada, where Internet gambling was recently legalized, is still at least two years away from achieving this.