Gambling News - May 2005 Edition
"Internet Gambling Bets on Cellphones"
PokerRoom.com launches cell-phone access to online poker.
In London stocks in online gambling businesses are not only easily available,
but are booming. As an example, two sites based in Gibraltar and one in London
are considering stock offerings in Great Britain and stock from Sportingbet,
a British online gambling company, doubled in value last fall after the company
acquired a leading Internet poker site. PartyGaming, an Internet gambling company
based in Gibraltar, and which operates the world’s biggest Internet card-game
site, PartyPoker.com, is considering going public next year. If it does, it will
have an estimated worth of almost five billion dollars.
In direct contrast, the U.S., in keeping with its government’s
hard line position which states that Internet gambling is illegal, is
incurring all of the negative consequences of the Internet gambling craze
and none of its benefits. Since Americans who want to gamble over the
Internet do so anyway, regardless of the law. So the U.S. gets no economic
benefit from the lucrative industry while it is still vulnerable to the
potential social cost which is the alarming increase in the number of
problem gamblers. While the U.S. market is, by far, the largest source
of Internet gamblers, the U.S. refuses to take advantage of this phenomenon
by legalizing and regulating the industry. Stock options for online casino
companies are therefore, not available in the U.S.
Now there is a new development in the gambling industry and that is
the ability to download betting games onto your cellphone. With the Internet
gambling industry expanding and advancing so rapidly, this news comes
as no surprise. PokerRoom.com is the first Internet gambling site to offer
such an option, which became available in April. The fast growth and accessibility
of online gaming and is indicative of its popularity and of course the
popularity of poker is growing at an incredible rate.
The big drawback of downloading Internet gambling games to a cellphone
is only the cost of doing so, since cell phone minutes are more expensive
than computer time. Potential investors do not seem to be bothered by
this factor and investment bankers are just waiting for the opportunity
to grab parts of the lucrative new stock offerings of similar sites.
If PokerRoom.com does decide to go public, such an opportunity may present
itself. PokerRoom.com’s parent company, Ongame, posted $60 million
of sales last year and is preparing for an initial public stock offering.
PokerRoom.com site was created by two Swedish medical school students
and they started accepting bets in 2001. About 80% of the PokerRoom.com’s
customers are from the U.S and it is ranked as the sixth largest Internet
card room. The site makes its profit by taking about three dollars off
of each wager, which is standard in the industry.
London’s increasingly friendly attitude toward the online gambling
industry makes the future of Internet gaming sites look rosy. New legislature,
recently passed by the British government, will soon legalize online gambling
and make regulating the industry easier. The law is generally welcomed
by those in the industry and as PokerRoom.com CEO, Patrick Selin, said, “It
will be very, very good for us. “It’s a genuine stamp of approval”.
The new law will definitely give all aspects of online gambling a legitimate
air, one which it does not enjoy at present.
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