Shooting the Online Angles By Luke Haward February 15, 2015 at 9:12 am The U.S. Department of Justice’s groundbreaking reinterpretation of the Wire Act, in December 2011, led directly to the introduction of online gambling by the states of Nevada, New Jersey and Delaware. It has also led to some key players in the gaming scene casting about for ways into the online market. The horseracing industry, tribal interests, and even a number of state lotteries have shown a renewed interest in going virtual. While such moves are not without controversy, in some cases bitterly so, momentum to get gambling online does seem to be growing in many quarters. While most forms of online casino gambling remain very much illegal in the majority of states, many do permit wagering on horse races from the comfort of one’s own computer. There are also a good number of websites which claim to provide betting options nationally, while excluding residents of states which ban such activities. The practice is fairly widespread, with around thirty states currently allowing it. It is believed that horseracing’s ability to elude the restrictions applying to most other forms of online gambling stems from its historically trans-class reputation. The publically traded Churchill Downs even has its own online component in the form of TwinSpires. In many cases Indian tribes have been opposed to any online gambling expansion, fearing that it might decrease visits to their brick and mortar venues, which tend to be located in somewhat remote areas. Still, there has been a growing tribal voice in favor, recently quite notably in California. The tribes are becoming aware that if they do not act fairly promptly, the market could become dominated by state lotteries and racetrack organizations. A coalition of tribes in California has been lobbying for the introduction of online poker, but not for any other forms of online gambling. Two tribes, The San Miguel Band of Mission Indians and the Morongo Tribe of Mission Indians, have joined with California’s three largest card clubs in a partnership with the company Pokerstars with a view to jointly operate a licensed online poker site once legislation is in place for that in the state. Opposition to Pokerstars’ presence in the market remains strong however. One tribe has gone even further, starting their own real money online poker site, under the logic that they are legally entitled to do so within the law applying to Class II gaming. PrivateTable.com, run by the Ysabel Gaming Commission, appears to be up and running. While the latest news stories don’t mention a launch, and merely point out a continuing legal battle, the website itself is claiming to be running real money games and taking deposits. The Iipay Nation which is behind PrivateTable claims to offer a legal alternative for the numerous California residents playing on illegal offshore sites such as Bovada.com. They were swiftly stomped on however when they moved to offer online bingo, shutting down the Desert Rose Bingo website under an injunction from the state. The tribe claimed that no wagering was taking place outside of tribal lands due to the use of VPN proxy technology, which on its face appears to be a spurious argument. The appropriately-named Iipay are arguably performing an important test on behalf of tribes everywhere. If they are permitted to extending Class II gaming beyond the physical limits of tribal land, this will set an important precedent for tribal gaming across the U.S. Lastly, state lotteries are gradually stepping efforts to have an online presence. Kentucky is looking to join Illinois, Minnesota, and Georgia in offering online play, and has started to negotiate with lottery technology provider GTECH over the development of an iLottery. Officials estimate that going online will result in more than $8 million in additional revenues in the first full year. Lottovate, a subsidiary of betting operator Tipp24, has worked to motivate U.S. state lotteries to go online. It has commissioned surveys to generate data to be used to encourage states to make the move. But some analysts have criticized the projections based on data from these surveys as being wildly optimistic. What’s the bottom line? The iGaming scene in the U.S. is undoubtedly on the move, but it has a while to go before it has any serious momentum. With the future by no means certain, many are waiting to see where the chips fall before they get too heavily invested.