Internet provides next new frontier for US gaming

“We expect that state lotteries – which have proven their revenue generation abilities and settled their online payment concerns – will lead the next wave of U.S. development toward regulated online gambling in 2010.”

Gambling Compliance’s ‘Market Barriers: US Internet Gaming’ is the most comprehensive and impartial analysis of the emergent U.S. market available. The report provides a clear understanding of the current political and legal factors in play as federal and state officials plot moves towards regulated Internet gaming.

As states across the country face mounting deficits and falling tax revenues, new analysis shows that legislators are looking beyond land-based casinos and racinos, and towards the benefits of expanding online gambling.

“There is clearly a recognition by some leading policymakers that expanded online gaming offers tremendous potential to state governments,” said Andrew Gellatly of Gambling Compliance, one of the report’s authors. “We expect that state lotteries – which have proven their revenue generation abilities and settled their online payment concerns – will lead the next wave of U.S. development toward regulated online gambling in 2010.”

Since it was banned in 2006, Internet poker has continued to gain popularity in the U.S., and Gambling Compliance expects that it could come out ahead of sports betting and online casino games as the regulatory dust settles.

The new study issued today demonstrates how key players from across the U.S. gaming sector – from state lotteries in Illinois and New York, to horse racing interests, to Las Vegas casino giants such as Harrah’s, Wynn and MGM – are all positioning themselves ahead of an online opening, and how they are each lobbying to influence change at both the state and federal levels. However, the Las Vegas casino industry remains divided over the wider fiscal implications of federal regulation. This is despite the fact that its leading players are arguably best positioned to take advantage of extending their brands onto the Internet.

While the opportunities of expanded online gambling remain attractive to some states and tribal interests, further legalization of online gaming in the US depends upon satisfying the financial needs of the relevant legislators, state governments and gaming interests.