After years in shadows, online gambling in US picks up speed

November 18, 2013 Leave a comment

After years in shadows, online gambling in US picks up speed

By Rob Lever, AFP
November 18, 2013, 12:08 am TWN

WASHINGTON–Internet gambling is on a roll in the U.S. market after years lurking in the shadows. New Jersey kicks off its online wagering Nov. 26, becoming the most populous state to do so after Nevada and Delaware. Other states have become active since 2011, when the federal government signaled it would not block most forms of Internet wagering. California, Illinois and Pennsylvania are considering such moves.Using geolocation technology, the systems require that gamblers be located within the state. But reciprocal agreements could allow gamblers to cross state lines as more states authorize online bets.

“Once these states are successful within their borders, they will figure out how to pool players across state lines to take bets from each other, and a lot of other states will jump in,” said Whittier Law School professor I. Nelson Rose.

“Within 10 years, I think we will see a very large portion of states will have Internet gambling.”

Morgan Stanley estimated legal U.S. online gambling revenues would reach US$670 million in 2014, increasing to US$9.3 billion in 2020.

The launch in a handful of states “will release a floodgate of investor interest in the online space, and spur new states to open to reap tax dollars,” analyst Vaughan Lewis said in a note to clients.

The United States has a patchwork of gambling regulations. While casino gambling was only allowed in Nevada a few decades ago, New Jersey allowed casinos in Atlantic City in the 1970s and many states have either commercial or Indian tribe casinos.

Until recently, the federal government claimed that online gambling was unlawful. But a 2011 Justice Department legal opinion said only sports betting would be considered illegal.

Nevada authorized online poker in 2012, and Delaware and New Jersey passed laws allowing a full range of casino games.

But Rose said the Internet opens up new categories of gambling, ranging from “social” games to virtual slot machines.

“People who play games online are not interested in picking numbers and waiting a week,” he said.

The gaming industry relies on federal guidelines for online betting, but Congress has been deadlocked on the matter amid disputes over whether any law would cover poker alone or a full range of games.

 

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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