You bet.com Partners with Station Casinos

10 June 1999
The virtual and traditional gaming worlds gravitated even closer toward each other Wednesday as Station Casinos Inc. announced that it has signed a deal with You Bet.com Inc. to jointly bring in-home interactive race and sports wagering to Nevada residents. The venture will be owned on a 50/50 basis by the two companies.

Youbet.com will adapt its proprietary software and technology and license it on a non-exclusive basis to the new venture. Station Casinos will fund a portion of Youbet.com's software development and contribute to funding advertising and other costs. The venture is subject to execution of definitive agreements, and its services will await regulatory approval, including that of Nevada gaming authorities.

The most significant aspect of the deal could be that the service will eventually allow subscribers to place wagers on sporting events at Station Casinos using their personal computers and the You Bet Network. Youbet Chairman and CEO is thrilled and called the agreement "an important step in our expansion into worldwide sports wagering."

If that step is taken, it could create an interesting dilemma should Internet gambling prohibition laws be passed. While Arizona Senator Jon Kyl's prohibition bill would criminalize the offering of bets over the World Wide Web, services like the You Bet Network, which facilitate gambling via a closed-loop system instead of using the Internet, would likely be given some breathing room to operate without breaking the law.

Kyl bill supporters have been relatively lenient on the interactive pari-mutuel wagering industry, but have resolved to come down hard on sports betting. The You Bet/Station venture could throw a wrench into the mix because it will introduce sports wagering to "closed-loop" betting. In short, bettors in Nevada will be able allowed to turn on their computers, log onto a network via a modem and place wagers on sports and horse racing. The activity will be legal because the bettors won't be using the Internet. That could be tough for legislators to swallow.

If they can pull it off, another door allowing Vegas corporations into the virtual gaming industry will be thrown open and Station Casinos will have a leg up on the competition. Station's Chairman and CEO Frank J. Fertitta III is well aware of this. "This joint venture provides yet another venue to build upon our brand-name franchise and enhance our distribution points in the Las Vegas locals' market," Fertitta said. "… We look forward to working with Youbet.com as first-movers in the rapidly developing area of on-line wagering in one of the largest gaming markets in the country."

Youbet.com is a Los Angeles-based interactive technology company that facilitates live events and is focused on content development, network deployment and management services via a cross-platform environment. The company announced in 1998 the public release of the You Bet Network, the only interactive online horse racing network in the U.S. Members can watch and wager on a wide selection of coast-to-coast thoroughbred and standard-bred horse racing, via its exclusive private closed loop network.

Station Casinos owns and operates the Palace Station Hotel & Casino, the Boulder Station Hotel & Casino, the Texas Station Gambling Hall & Hotel and the Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Sunset Station Hotel & Casino in Henderson, Nevada, as well as slot machine route management services in Clark County, Nevada. The company also owns and operates Station Casino St. Charles, a gaming and entertainment facility in St. Charles, Missouri and Station Casino Kansas City, a gaming and entertainment facility in Kansas City, Missouri.

The Youbet/Station service will be available exclusively to Nevada residents and is targeted for release during the second quarter of 2000.