Weekly Nambling Notes

13 June 2004
Friday, June 11

DCMS Response -- The next phase in the implementation of the England's new Gambling Bill will be revealed on Monday as the Department of Culture, Media and Sport publishes its response to the joint scrutiny committee that evaluated the proposed bill. Gambling minister Andrew McIntosh has indicated that around 100 of the committee's 139 recommendations may have been accepted, but at the end of May, many British media sources reported that DCMS secretary Tessa Jowell planned to reject the committee's recommendations to treat betting exchanges differently than other betting sites.

Opinion -- Advocate General Stix-Hackl of the European Court of Justice delivered her opinion Tuesday on four cases involving the use and protection of databases. William Hill, the British Horseracing Board, Oy Veikkaus, Fixtures Marketing, Svenska Spel and OPAP (Organismos prognostikon agonon podosfairou) were all parties to at least one of the four cases. The opinion of the advocate general is that the maker of a database has a right to protection under the database directive, even when that database was created mainly for the purpose of organizing football fixtures or horseracing. Bookmakers' use of that data is therefore prohibited, even if they obtain the information from independent sources, such as newspapers or the Internet. The ruling is not final; it is only an opinion. The final judgment should be rendered by the European Court of Justice sometime next year. The court usually follows the opinion of the Advocate General.

Survey Says -- IGGBA (Interactive Gaming, Gambling and Betting Association), a representational body for the European I-gaming industry, has 47 members, has compiled the results of a survey distributed to attendees of its recent conference. The organization says that more than 60 percent of respondents are fearful that Britain's new Gambling Bill will not pass in 2004 because it is being slowed down by traditional casino issues. Sixty-two percent of respondents would rather see a country-of-origin approach to licensing remote gambling operators than a harmonization of I-gaming laws. More than 60 percent replied that a tax rate greater than 5 percent would repel operators away fro the United Kingdom.

Thursday, June 10

The EUFA Euro 2004 soccer tournament begins in Portugal on Saturday. One of the largest sporting events of the summer, the Euro is certain to draw huge numbers of wagers. A few bookmakers have launched new services and promotional plans to catch new players. Most, however, are likely more concerned about another potential round of attacks from hackers. Meanwhile, authorities in a few Asian jurisdictions where betting on the tournament is illegal have taken precautions to limit and punish betting on the games.

ITVi Betting -- Sportech, the British owner of Littlewoods Gaming has launched the first fixed-odds betting service available within ITVi. Viewers can access Littlewoods Bet Direct by pressing the red or text button on their television's remote control, and programming remains within a quarter of the screen.. The system allows in-game betting on several sets of possible outcomes of the game, such as who will win the game, which player will score the first goal, and how many corners will be awarded. A national press campaign promoting the service will begin on Saturday.

Upgrading -- Anticipating growing traffic due to new customers and more wagers during a summer that will feature both the Euro 2004 soccer championships and the Summer Olympics in Athens, Ladbrokes at the end of May contracted Sun Microsystems to install new server systems to manage the impending influx. Ladbrokes is also receiving 24 servers to support its Web site application layer, 10 servers to support is Web layer and a more sophisticated disaster recovery facility.

BetEuro.com -- BetEuro.com, the new site managed by VIP Management Services, is trying to attract new punters in time for the Euro 2004 by offering several promotions. The site is offering punters guaranteed prizes of 2,500 euros and a grand prize of 50,000 euros in its Euro Football Challenge prediction game. New customers will be entered into a draw for 20 copies of the UEFA Euro 2004 video game. Customers can try the BetEuro.com system for free or for real money. The site will be based at the company's headquarters in the Netherlands Antilles and will at first focus on sports betting but will gradually increase its scope to include gaming services.

DDoS -- According to research and analysis firm Netcraft, which has been monitoring the performance 20 Internet gaming sites, a new wave of hacker-launched DDoS assaults is already underway. Capital Sports has suffered the worst, having been offline for at least 15 hours, beginning on Wednesday. Bluesquare, which also went down for about two hours on Wednesday, verified that it received a ransom demand for $30,000 in order to remain attack-free. Netcraft reported that Ladbrokes and William Hill may also have been offline for about 15 minutes each.

Quoteworthy -- "With the approach of Euro 2004, football gambling is again a social issue of public concern. We hope the Web site can help students better understand the influence of football gambling on their finances, studies, emotions and future and that they will refuse to take part in gambling activities, and 'say no to football gambling'!"

- Cheung Wing-hung, Chief curriculum development officer of Hong Kong's Education and Manpower Bureau, which has launched the "Say No To Football Gambling" section of the Moral and Civic Education Web site. The site offers learning and teaching resources and games.

Combat Around the Clock -- A "metropolitan police center" has been established in Bangkok to combat illegal soccer betting around the clock on Euro 2004 games. A spokesman for the Metropolitan Police Bureau said they expect to begin arresting bookies gamblers on Saturday, especially around the Ramkhamhaeng University, where soccer gambling is widespread.

Malaysia -- Police in Kuala Lumpur said last week that they were aware of at least 15 illegal football betting Web sites that have been established by Hong Kong-based syndicates in preparation for the Euro 2004. Investigators are attempting to extinguish the betting sites through assistance from the National ICT Security Emergency Response Center. To prevent the sites from being tracked by authorities, computer programmers and webmasters for the sites have created mirror site that lead trackers to false locations, such as porn sites. Police speculate that syndicates have raised billions of Malaysian ringgit in the last year.

Wednesday, June 9

Video Games Ads -- Arizona-based market research company In-Stat/MDR predicts that the online video games market, which grossed $1 billion in 2003, will grow to close to $4 billion by the end of 2008. The company expects the video games industry to begin taking more revenue as providers tap into the same in-game advertising opportunities that TV networks have historically enjoyed. It now costs a player about $1 per hour to play online games and about $0.13 per hour to watch TV. According to In-Stat/MDR's senior analyst Eric Mantion, "When the costs of online gaming per hour starts to approach the level of TV, you can expect people to spend a comparable amount of time gaming. The secret strength of online games will be when the volumes of people playing grow to the point where advertisers will start buying ads that will not only be interactive, but also targeted at specific demographics of players."

High-Profile Events -- The Wall Street Journal recently reported that high-profile racing and sporting events have been giving "legal and illegal gambling sites on the Internet" increasing profits and numbers of customers. The report included figures from Christiansen Capital Advisors, which estimated that online betting on the current NBA playoffs should total $85 million, compared to $74 million last year. CCA also estimated that the more than 1,800 online gambling sites around the world should clear $7.46 billion in 2004, compared to last year's $5.69 billion.

NYRA Under Watch -- Neil V. Getnick, who has been appointed by a court to supervise the New York Racing Association, is investigating whether the betting agency misused funds from the NYRA One accounts, used by hundreds of telephone bettors, to pay bills and other expenses. NYRA spokesman William Nader insists that the NYRA One accounts are now fully funded and have been for a long time, although he conceded that in the past the NYRA might have used some of the money held for bettors in the accounts. Getnick is also trying to determine whether NYRA misused $14 million of horse owners' funds that were held in purse accounts and combined with the NYRA's finances.

Phoenix Interests -- Thoroughbred Interests, Inc., a Kentucky-based company whose core business had historically been pinhooking thoroughbreds, has changed its name to Phoenix Interests Inc. to reflect its intent to broaden its focus beyond the thoroughbred industry and into gaming and entertainment sectors. The company has also changed its ticker symbol to PHXI.OB. The company's chairman, president and CEO, Jim Tilton, Jr., said, "We are very enthusiastic about repositioning the new entity into the multi-billion-dollar online gaming sector and exploring possible acquisitions in the racing, gaming and entertainment sectors. We feel it is appropriate to change our name to better reflect our broader focus. We intend to remain involved in the thoroughbred industry, but it will not be our only focus. We believe the broader focus will allow us to significantly increase our revenues and earnings."

Boss Licenses Patent -- Sweden-based I-gaming software provider Boss Media has signed a technology license agreement with Dr. Scott Lewis to use Lewis' patented optimization technology for online gaming products. Lewis said he "looks forward to working with other leading companies in the gaming industry to license this technology as the ‘gold standard’ for advanced gaming applications."

Mobile Phone Sales -- Gartner announced this week that worldwide sales for mobile phone units reached 153 million during the first quarter of 2004, prompting Gartner to raise its sales estimates for the year to more than 600 million. One hundred fifty-three million sales marks the highest first quarter ever and is 34 percent more than last year's first quarter sales mark of 114 million. Nokia is still the leading seller, with sales up 5 million year-on-year to 44.2 million, although its market share is down to 28.9 percent after being at 34.6 percent in last year's first quarter. Motorola took a 16.4 percent market share, Samsung took 12.5 percent and Siemens took 8 percent during the quarter.

Brussels Office -- The interactive Gaming, Gambling and Betting Association (iGGBA) has opened an office in Brussels to represent the remote gambling industry in discussions at the E.U. level. The association has already met with officials from the European Commission and in the future will advise the European Parliament and Council further on the Services Directive.

Tuesday, June 8

French Casino -- Net Entertainment, a Swedish company that provides non-download Internet casino software, is supplying its Casino Module product to Mr. Bookmaker.com, which has a leading position in the main French-speaking markets in Europe. Net Entertainment's CEO, Pontus Lindwall, said the deal marks a breakthrough in the French-speaking European market for his company.

New Kiwi Restrictions -- In New Zealand the legal age to buy instant kiwi tickets has been raised from 16 to 18, and liability now lies on buyers and sellers if the law is not observed. The changes come as the result of provisions in the country's new Gambling Act of 2003, and the New Zealand Lotteries Commission is preparing to conduct an in-store customer awareness campaign and training for all retail staff to ensure enforcement of the law.

Monday, June 7

More Languages -- eCOGRA (eCommerce and Online Gaming Regulation and Assurance), an organization that awards certificates of approval to online casinos that meet its standards for fair gaming, player protection and efficiency, says it can now provide operators with certificates in the Dutch, Chinese, Japanese, Portuguese and Hebrew languages. Previously, the certificates had been available only in English, French, German, Spanish and Italian.

Quoteworthy -- "The secretary of state took the view last year that the Gambling Bill would be viewed in Parliament and the wider country as a substantial piece of essentially social reform. The wider social impact and the perception of sufficient safeguards will make or break the bill. Thus, the government thought it important to involve both houses and virtually all parties early in considering how legislation could be best designed, including what protections are necessary for what will always be an enjoyable, but inherently risky activity."

Greig Chalmers, Britain's DCMS Gambling Bill manager, stressing the need for social responsibility in passing the Gambling Bill through Parliament.

Spread Betting Exchange -- Cantor Index has launched an online spread betting exchange at www.Spreadfair.com. The site is different from most P2P betting exchanges in that it focuses on spread betting rather than fixed-odds betting. Spreadfair takes a 5 percent commission from winners' profits.

IT Challenger -- EssNet, a Swedish supplier of lottery and gaming products for terminals, Internet and mobile phones, was named "IT Challenger of Year 2004" by Veckans Affärer, Sweden's most popular business magazine, which provides a yearly analysis of the country's 500 biggest IT companies. According to the magazine, "EssNet is a pure software company, developing and selling software worldwide to the big state-authorized gaming and lottery companies, such as Norsk Tipping and Australian Tattersall's. EssNet is a model example of a company that with new owners and clear focus can reach new successes. Previous owners were both Hugin, the producer of cash registers, and Esselte, the giant supplier of office equipment. Being a niched supplier, EssNet serves as a model for the Swedish software industry, proving that Swedish IT companies by its own efforts can be very successful abroad."

Happy Birthday -- Betfair celebrates its birthday today, having launched four years ago on Oaks Day at Epsom. The company boasts 200,000 registered users from over 85 countries and technology that can handle 1 million transactions per day and match 12,000 bets per minute.

The Streak -- World renowned streaker Mark Roberts humored spectators between races at the Epsom this weekend by galloping down the track wearing little more than the now famous Golden Palace.com temporary tattoos.

Illegal in Malaysia -- Police in Kuala Lumpur say they are aware of at least 15 illegal football betting Web sites that have been established by Hong Kong-based syndicates in preparation for the Euro 2004 championships that will begin next week in Portugal. Investigators, who expect more sites to emerge in the next few days, are attempting to extinguish the betting sites through assistance from the National ICT Security Emergency Response Center. To prevent the sites from being tracked by authorities, computer programmers and webmasters for the sites have created mirror site that lead trackers to false locations, such as porn sites. Police speculate that syndicates have raised billions of Malaysian ringgit in the last year.