Is GPS Technology Ready to Take on Virtual Gambling?

Thanks to the wide range of legislation regarding Internet gaming and wagering around the world, reliable border control technology for blocking bettors in certain locations is in high demand. For example, interactive gaming regulations in jurisdictions like Malta, Belize and a few Australian states and territories prohibit licensees from accepting residents as customers. In response, Virtgame.com and several other companies have been hard at work developing strong, user-friendly border control technology. While Virtgame is close to receiving full approval for its eBorder Control technology from the Nevada Gaming Board, another company is adapting a previously available technology for Internet gaming purposes.

Using the same GPS (Global Positioning System) satellites that the U.S. government uses to target missiles, officials at Global Cyber Licensing LLC, based in Denver, Colo. say they can authenticate the location of any Global Cyber-enabled computer logged onto a Net gambling site from virtually anywhere in the world. The system is so accurate, says Global Cyber Vice President Paul Siegel, that the user's location can be pinpointed within one or two meters.

"Until now, cyber-casinos could not ensure regulators that they could identify where their gamblers are located," Siegel explains. "Global Cyber's technology will prevent users from logging on where gambling is prohibited. Therefore, it helps protect gaming licenses. For regulators, it will ensure that those who participate in gambling do so from a location where it is legal."

The system is very simple. When a virtual gambler logs on, his geographic location is determined using CyberLocator's GPS technology, information that cannot be faked or intercepted. A secure casino-based server authenticates the player's location within a few seconds. Those players logging on from jurisdictions allowing Internet gambling can continue, while anyone else is denied entrance to the betting site. The entire action works quickly and remains transparent to the player.

Global Cyber is negotiating with five land-based casinos interested in entering the virtual fray, including three from the United States, and has also talked with several virtual operators. The company has also approached Technical Systems Technology (TST) to certify that the CyberLocator service does what it's supposed to do.

In addition, gaming regulators in Nevada, New Jersey and Colorado have informally examined CyberLocator. "We're hoping to get the product before the Nevada Gaming Control Board for licensing as associated equipment," he added. Plus, regulators from two Australian states recently checked out the system, and told Siegel that they can foresee the possibility that licensing regulations would eventually require operators to use some kind of location authentication tool like the CyberLocator product.

The system does have a couple of potential drawbacks, including the steep initial investment needed from both the gaming operator and the players. Although Global Cyber is still finalizing its pricing structure, Siegel estimated that operators would be charged an initial licensing fee of $250,000 for set up or access to servers, network, and software. Operators would then be charged $1 each time a player logs onto the system during a 24-hour period.

The players, meanwhile, would need to attach a small GPS receiver to their PC, which could cost between $70 to $100. That price tag could scare off some players, although most operators that Siegel has spoken with indicated that "in general, the casinos would pick up the cost in return for frequent player points" or other player loyalty programs. Plus, Siegel suggests that the investment will reassure players regarding the e-casino's legitimacy. Companies that are willing to make this type of investment, he explained, will be less likely to abscond with players' money.

Despite a few hurdles that could be tough to overcome, the company calls its location authentication business an "end-game" technology. "Compared with other authentication methods, which can be intercepted, faked or stolen, GPS authentication is unequivocally accurate in determining the jurisdiction where a gambler is located," added Global Cyber CEO Bill White. "We believe that this is the 'end-game' technology needed to unlock the Internet for gaming."