Industry News

Germany Bans Online Gaming
Online poker players in Germany had one fewer reason to celebrate the coming of the New Year as Jan. 1, 2008, marked the beginning of a state-ratified online gambling ban in Germany, in a move meant to safeguard the country's state monopolies on lotteries and other forms of online wagering.

The new online-wagering laws - which have been ratified in 13 of the 16 German states, so far, meaning the majority requirement has been met - ban any form of Internet gambling or the brokering of games online. The new rules allow the German states to order banks and financial institutions from transacting with Web sites offering online wagering (similar to what the Unlawful Internet Gambling Enforcement Act does in the U.S.) and to order Internet service providers to completely block those sites.

Tipp24, one of Germany's leading online lottery brokers, said in a statement that it felt the ban was illegal and that it was prepared to take legal action to ensure it could continue to conduct its business.

BWin, which is licensed in Gibraltar and also operates under a license issued by the former East German administration is also reported to have stated its intention to contest the ban claiming it is illegitimate in the face of the company's existing licenses.

Advertisements for Internet gambling are also severely restricted as a result of the new rules. The regulations imposed on such advertising state that the ads may not "directly invite, incite, or prompt," people to gamble online, but they can still let potential customers know that Internet gambling is possible.

The Brussels-based European Commission, the regulator for the European Union, still has the opportunity to challenge Germany's new regulations. The Commission told Germany earlier this year that it thought a total ban on Internet gambling was excessive and asked the country to reconsider. Germany refused and set in place the ban that became official on Jan. 1. The Commission can sue EU member states for failing to adhere to EU law and to force them to comply.

U.S. Agrees Gaming-Ban Settlement with EU
The U.S. has come to a compensation agreement with the European Union and other members of the World Trade Organisation who sought recompense because of the United State's stance on online gambling.

The agreement gives EU service providers new trade opportunities within:

1. The U.S. postal and courier sector
2. Research and development
3. Storage and warehouse sectors

A monetary figure was not available.

Online gambling companies located in the EU estimated that upwards of $100 billion would be lost annually if the U.S. continued to work to prohibit its citizens from gambling online.

The amount the U.S. will have to compensate WTO member Antigua and Barbuda (who act as one member), the Caribbean nations who sued the U.S. via the WTO, is still up in the air. The two countries are seeking around $3.4 billion annually, and so far the U.S. has offered just $500,000. If the two parties cannot agree on a figure a WTO panel will decide how much the sanctions will be.

Harrah's Sale but No Change for World Series
The multi-billion dollar sale of Harrah's to two private firms will not change the way the World Series of Poker will be run in 2008, and the current management, who will stay with the company, says that the WSOP will remain an important property for the company for years to come.

"The WSOP will remain a key brand in the Harrah's portfolio, and one earmarked for expansion on a number of fronts," said WSOP communications director Gary Thompson.

Thompson noted that the senior management team, lead by Harrah's Chairman and CEO Gary Loveman, will remain in place. WSOP commissioner Jeffery Pollack and his team will also remain.

In April 2007, Harrah's shareholders approved the $17.7 billion sale of the company to private equity buyers Apollo Management and Texas Pacific Group. It has taken this long for the company to receive sale approval from the gaming boards of each state Harrah's operates casinos in, as well as the foreign countries in which Harrah's also has casinos. Nevada's Gaming Commission has now given its approval to the sale, as has the National Indian Gaming Commission, which were the last two commissions the parties needed on board for the sale to move forward.

These final hurdles will allow the sale to go through sometime early in 2008.

Harrah's is the largest casino operator in the world. With more than 50 casinos, its revenue was almost $10 billion in 2007. Apollo Management and Texas Pacific Group will buy Harrah's for $90 a share.

Poker Boosts Gaming VC Profits
Gaming VC, the Maltese-licensed gaming firm, posted robust results for the first half of 2007 with gross win for poker at €1.4 million to June 2007, up from €1.15 in the same period of 2006. To the end of November 2007, poker gross win was €2.9 million, up from €1.9 million in the same period of 2006.

In the first half of 2007, the company received 19,772 registrations, up more than 100 percent on the same period in 2006 when just over 9,000 people registered. Depositing customers grew to 11,513 from 2,759 in the first half of 2006.

Daily average revenue was in the first half of 2007 was €8,300, up from €3,600 in the same period of 2006.

Overall, the company's turnover increased 3.8 percent to €22.0 million, up from €21.2 million in the six months to June 2006.

Mansion Customises Tournaments
Mansion.com has launched customisable tournaments allowing players to create their own buy-in level, game types, blind structures, and payout schedules.

This unique feature allows players to select a start time for themselves, their friends, colleagues, or family, then choose a game type, a limit type, and nominate the buy-in from $5+0.50c up to $500+$25. Between two and 50 players can sign up for a customised tournament and choose between turbo, normal, and slow blind structures and a payout structure which includes winner takes all.

Mansion Poker ambassador and UK poker professional Marc Goodwin said of the latest development, "What's better than a good game of cards amongst your mates to settle a score? This is a great addition to the MansionPoker site, so get some friends together and give it a go."

Internet Giants Pay for Accepting Gaming Ads
Microsoft, Yahoo, and Google have agreed to pay $31.5 million to U.S. authorities to settle a claim that they accepted online ads promoting illegal gambling, according to Associated Press.

In settling the claim, the companies made no admission of guilt that they illegally accepted payments from online gaming firms between 1997 and 2007.

Microsoft will pay a total of $21 million, with one-third going to a charity for exploited children. It will also fund a three-year advertising campaign aimed at educating young people about illegal online gambling to the tune of $9 million.

Yahoo will hand over $3 million and also fund an educational advertising campaign at a cost of $4.5 million, while Google will pay authorities $3 million.

All the companies say they stopped accepting such ads a number of years ago.

UK Gambling Commission Warns on Prizes
The UK Gambling Commission has warned poker operators in the UK that offering seats in poker tournaments as prizes amounts to "foreign gambling" if the tournament where the seat is offered is outside the European Economic Area, Gibraltar, or a 'white-listed' jurisdiction.

A statement from the Commission said:

"It has come to the Commission's attention that a number of operators are offering places at overseas poker tournaments as prizes in UK-based competitions.

"For example, a poker tournament played either at a UK casino or online may offer the winner the chance to play in a cash prize tournament held outside the UK.

"In the Commission's view, the offering of such a prize amounts to advertising of non-UK gambling, as defined by section 327 of the Gambling Act 2005. Unless the overseas tournament is based in the European Economic Area, Gibraltar, or in white-listed jurisdictions, the advert is likely to amount to the advertising of "foreign gambling", which constitutes an offence under section 331 of the Gambling Act 2005.

"Operators should take steps to ensure that any advertising which they are responsible for complies with the requirements of the Gambling Act 2005."

Many companies, including UK casinos and online rooms based within the Commission's jurisdiction, will have to review their use of popular prizes such as seats at the World Series of Poker main event and Aussie Millions or face a fine, up to 51 weeks in jail, or both.