Weekly Nambling Notes

5 June 2004
Friday, June 4

Alderney -- The Alderney Gambling Commission this week issued WagerWorks a license to operate Virgin Games.com. The commission says it is also considering an application by financial brokerage firm Cantor Fitzgerald. An independent, non-political body, the Alderney Gambling Commission recently reported its annual financial figures for the year ended Dec. 31, 2003. Interactive gaming and gambling licensing fees provided the commission with £535,502 over expenditure in 2003, while it experienced a small surplus of £62,165 the year before.

Dog Faster than Horse -- Kempton Park, Wednesday, was the setting for an unprecedented race. Simply Fabulous, a seven-year-old retired racing greyhound set up beside Tiny Tim, a horse in prime running condition, in what was dubbed the Challenge of the Species, an event to promote both the Epsom Derby and the Greyhound Derby this weekend. The debate over which racing animal is fastest was settled when Simply Fabulous stunned everyone by crossing the finish line seven lengths ahead of the horse. The owner of Simply Fabulous, David Hood, said, "I'm a bit shocked because I wasn't expecting Simply Fabulous to win. But greyhounds are terrific athletes, they can accelerate from 0 to 40 mph in one second. There's no other animal that can compete with them, and this shows that over a certain distance they can beat the best racehorses." Punters wagered close to £10,000 on the race, with nearly all it backing Tiny Tim to win. The largest single bet on Simply Fabulous was £200.

Bonus Pack 4 -- WagerLogic Limited, a provider of online gaming software and a subsidiary of CryptoLogic, has released Bonus Pack 4, which contains 11 new video slots with titles describing their themes. The new games are Dick Danger, 20,000 Leagues, Cash Caper, Cool Bananas, Eastern Dragon, Free Kick, Kanga Cash, Love Bugs, Magic Carpet, Nothin' But Net and The Oracle. The new slots offer three to 20 pay-line games, animated bonus rounds, and bonus features. Players can wager between $0.01 and $180, and each game pays out 95 to 98 percent. The full suite will go online first at InterCasino.com.

Encourage Lotto Bids -- Tessa Jowell, Britain's Secretary of Culture, Media, and Sport, said that her department is seriously considering government proposals to encourage competition in bidding for the National Lottery licenses. "We have listened to these concerns and recognize the need for a fresh look at how we can maximize returns to good causes," Jowell said. "We will look at evidence that has emerged since we announced our proposals and work with the NLC, Camelot and others on a variety of options - both within the existing law and those requiring legislation. We still intend to include licensing reforms in the Gambling Bill which we hope to put before Parliament as soon time allows."

Thursday, June 3 p align="justify">The Battle of the Bookies -- BBC2's The Money Programme broadcasted a 30-minute segment last night titled "The Battle of the Bookies," which presented the arguments of both British bookmakers and betting exchanges with regards to the effects of exchange betting on the integrity of horseracing. In addition to the controversial allegation by Ladbrokes CEO Chris Bell that at least one race per day is fixed, the segment also featured comments from William Hill CEO David Harding, who stated, "I think [corruption resulting from exchange betting] is inevitable, because the opportunity is there to stop horses and inevitably people will seek to profit from it. The last person to see a horse has the ability to spike that horse and profit from it losing." On the other side of the issue, Betfair spokesmen Mark Davies and Andrew Black argued that by providing transparency the exchanges are actually benefiting racing by exposing corruption that has always existed--even before the rise of exchanges. Paul Scotney, director of security for the Jockey Club, concurred that certain scandals could not be detected without the assistance of exchanges, but Harding countered, "Prevention is better than detection, getting better at detection is pointless, why open up the loophole anyway."

Japanese Casinob -- The Trident Group has launched a Japanese version of King Neptune's Casino. The site features the latest version of Microgaming's Viper software and will provide VIP services, marketing, promotions and customer support in the Japanese language.

New Graphics, New Game -- Finnish gaming solutions provider European Game & Entertainment Technology (EGET) recently helped its licensee, Swedish operator Sperospel.se, increase its instant games selection in a fast and cost-effective way. EGET, whose WinOne gaming system and instant game module are the foundation on the sperospel.se site, simply altered the graphics of the site's most popular game, Casinolotto, while keeping the game logic completely the same. By changing the graphics in two different ways, EGET created two new games, Tiger Swing and Casino Roy, which it claims are so strikingly different from the original that it is impossible for players to realize that they are actually playing the same game.

Gold-digging -- LegalPlay Entertainment, the Vancouver-based company that operates SkillPoker.com, is looking at new options to increase lagging shareholder value. The company is apparently not receiving a large enough profit from its gaming operations. According to LegalPlay's president, Mark Glusing, "The dramatic change in business was forced by competition from similar companies based offshore, while awaiting federal legislation to legalize online poker in the U.S. and Canada. Competition in online gaming is extremely competitive and until such time that legislation is passed in the states, the Skill Poker system will not be a popular choice for the online gaming consumer." To compensate for waning business, the company plans to enter joint ventures with mining claim-holders and is now engaged in discussions with several parties to acquire mineral properties. "Sure, mining is a bit of a gamble, but at least we don't have to worry about the (U.S.) Justice Department when we're digging in the ground," Glusing added. "We chose mining because the rise in demand and price for gold, silver and other mineral commodities made the industry attractive." The company will continue to operate SkillPoker at least for now.

Isle of Man Wins Awards -- The Isle of Man's finance center was declared the winner of two awards last month. The Isle was named the Best Offshore Financial Center at the International Money Marketing Awards by winning the most votes from the hundreds of IFAs in the 2004 Quantitative IFA Offshore Business Survey. The Isle also retained its title as Best International Financial Center for the fourth year in a row at the International Investment Awards.

Wednesday, June 2

Cockbetting -- Philweb, an Internet service provider in the Philippines that operates online casinos and sports betting services, has stated that it would like to launch an online betting site for cockfighting within the next few weeks. Cockfighting, which is massively popular in the Philippines and considered by many to be the national sport, already has an established Internet presence. One cockfighting site, Sabong.net.ph provides news, contest schedules, links to feed makers and pictures of the fighters. Philweb estimates that by offering wagers on some of the tens of thousands of cockfights held annually in the country it should generate 60 million pesos ($1 million) in yearly revenue. The Philippine Amusement and Gaming Corporation, which regulates gambling in the country, says it is not yet committed to launching a cockfight wagering site, however.

Mobet -- Rapid Mobile Media has developed Mobet, a mobile betting and gaming platform that offers lottery, scratch-card and sports book solutions. The system provides four levels of security and protects transactions by using techniques that comply with banking standards. The company says it has worked with banks and telco's in the past and therefore uses "security methods that are tried and tested in the commercial real world." Rapid Mobile is offering the system to operators as a plug-and-play white-label product to operators.

Quoteworthy -- "I never in any way stated the races were fixed or dodgy. What I said was they all had suspicious betting patterns, linked to under-performance, and I recommended the Jockey Club investigates each one of the cases and also look at the overall pattern I had highlighted between jockey and trainer. By investigating them, the Jockey Club would have been able to eliminate those with justifiable reason for under-performing."

-- Clive Reams, boss of Racefax, a company that monitors betting exchanges. Reams delivered a report to the British Horseracing Board and Jockey Club, claiming that there were 235 suspicious races in a 16-month period. It is believed that Reams' report was a major factor that lead to Ladbrokes CEO Chris Bell stating he believed that at least one race per day in Britain is fixed.

Reams says horses that met four criteria were included in his report and explained to the Racing Post that the criteria "are that the horse has drifted by 10 percent against field-book price; under-performed by 20 percent against BHB ratings; the volume matched is in excess of £20,000 per horse; and that there had been either an unusual riding tactic or change of equipment like blinkers or tongue-tie. Under these criteria, each of those 235 horses had aroused our suspicions, but we are not accusing anybody of being guilty (of any offense), we are just making them suspect."

Censorship -- The Chinese government has established a committee to review and censor any video and online games that threaten state security, damage the nation's glory or infringe on other's legitimate rights. Games that contain objectionable material, such as sex, violence, gambling and misrepresentations of gambling, are to be censored. All games currently on the market must receive the committee's approval by September, and all future releases must also obtain approval.

Virtual Lottery Museum -- To commemorate the 30th anniversary of the first secure instant lottery ticket, Scientific Games Corp has launched the Scientific Games Lottery Museum on its Web site at www.scientificgames.com. The virtual museum provides a history of the developments in lotteries and features images of Scientific Games' instant lottery tickets from 1974 to 2004. The company says it has made more than 10,000 pieces of memorabilia available to the public via the online museum.

Improving Customer Service -- Betting exchange BETDAQ has implemented Talisma's Multi-Channel Customer Interaction Suite to provide its 40,000 active users from 152 different countries with multiple channels of customer communication. BETDAQ's customers can now contact customer service representatives immediately via a new chat function. The Talisma products also enable BETDAQ to define and measure its service across its communications channels (phone, e-mail and Internet chat) and lets its customer service team initiate co-browsing and desktop-sharing capabilities to help customers fix PC problems and optimize Internet browsers to take full advantage of the BETDAQ Web site's functionality. Talisma, a provider of multi-channel CRM solutions, also has Microsoft, Citibank, Dell, Sony and others as clients.

SportXction -- Interactive Systems Worldwide Inc.'s (ISWI) SportXction in-running betting system launched today at www.totesport.com. Totesport will begin an aggressive online marketing campaign to promote the SportXction System in time for the Euro 2004 soccer championship beginning June 12. Global Interactive Gaming, a subsidiary of ISWI, will operate the SportXction system for Totesport.

Tuesday, June 1 p align="justify">Law Suit -- Commonwealth Bank of Australia is suing International All Sports to recover a sum of $17 million, roughly the same amount of money stolen from the bank by one of its managers, Kim Faithfull, over the course of five years to place wagers with the betting company. The bank claims that IAS encouraged Faithfull's habit-- which accounted for 65 percent of IAS's revenues--by sending gifts such as expensive wines and an invitation to attend the Melbourne Cup as a guest of Mark Read, IAS's owner. The bank also believes IAS was aware that Faithfull was a banker and acquired his assets fraudulently. According to Commonwealth's statement to a federal court, IAS "wilfully shut its eyes to Mr Faithfull's fraud, or consciously refrained from inquiry" as to the source of Faithfull's funds. The Northern Territory Government Racing Gaming and Licensing Commission has already declared that its investigation of IAS was "unable to find any breach of relevant regulatory regime on the part of the licensee, nor any culpable shortcomings in corporate governance." The South Australian Supreme Court, however, recently ordered Sportingbet to pay back over $2.6 million to a company after one of its employees stole $22 million to gamble. Commonwealth has also filed suit against the Totalisator Agency Board of Western Australia, which accepted over $178,500 in bets from Faithful.

Goodbye -- U.S. Attorney General John Ashcroft has named James Martin as the man who will replace Raymond Gruender as interim U.S. attorney for the Eastern District of Missouri. Gruender, who is responsible for initiating a campaign against I-gaming advertisements by issuing warnings and subpoenas to media bodies, has submitted his resignation, effective midnight Friday, to become a judge for the 8th U.S. Circuit Court of Appeals. Martin, a prosecutor who joined the U.S. attorney's office in 1984, is Gruender's executive assistant. Legal experts say Gruender's resignation won't have any short-term implications on the campaign against I-gaming since the prosecutor's office is not likely to cease an open investigation.

Rumor Mill -- Rumor has it that World Poker Tour on the Travel Channel will resume advertising for the PartyPoker and PokerStars networks. But rather than advertising for the PartyPoker.com and PokerStars.com sites, which permit poker playing for real money, World Poker Tour will promote PartyPoker.net and PokerStars.net, which will only allow poker playing for fun. The thinking is that World Poker Tour would not be promoting gambling services if it promotes a site at which no real money is wagered, even though the actual gaming site would be just a few clicks away.

Quoteworthy -- "If the government ignores the unanimous recommendations of the scrutiny committee, then we move into a different world. At that point, it gives a clean bill of health to what the exchanges do. We would have to look at, or at least examine very seriously, whether to enter that marketplace. I don't see how, as a very serious player in the market, we could be happy with a situation where a competitor can exist offering our customer base betting opportunities to act as a bookmaker without paying tax and levy. It would be questionable how long that would be sustainable."

- An anonymous inside source with Ladbrokes, as reported by The Sunday Times.

Ladbrokes CEO Chris Bell told the BBC2's the Money Program Friday that he believes at least one British horse race per day is fixed. The Racing Post has since reported that Alex Pagett, group corporate affairs director for Ladbrokes, will not deny speculation that the company is considering launching an exchange of its own. Accoring to Pagget, "Ladbrokes has no immediate plans to have a betting exchange. Our prime focus right now is to get a level playing field in the industry as far as exchanges are concerned. But, it would be foolish to rule anything out. I am in touch with out chief executive several times every day, and I know exactly what’s going on.” In related news, within the week the Department of Culture, Media, and Sport is expected to reject the joint scrutiny committee's suggestions that the government examine a new tax regime for betting exchanges.

BoDog Poker -- Costa Rica-based BoDog.com has chosen software from Micropower Corporation (www.micropowercorp.com) for its upcoming poker room project.

Skill Poker -- After two years of development, ThwartPoker Inc has released what it calls a "first-of-its-kind" poker room that replaces chance with skill. Called ThwartPoker, the game network claims to add skill and strategy by allowing players to pick the cards they want, rather than being dealt cards at random. The ThwartPoker.com Web site has launched with two games, Hold'em Blitz and 6 Card Battle, which are free to play. Multiplayer online tournaments for prizes will launch later this month. A mobile version of ThwartPoker has already gone live on Verizon Wireless and AllTel thanks to its licensing deal with Atlas Mobile Inc.