On the eve of the Great Internet Gambling Debate, an informative report on internet gambling
With members of the House Financial Services Committee gathering in Washington DC Tuesday to mark-up Congressman Barney Frank's latest legislative proposal to legalise US online gambling, the New York Times carried a review of the pastime and the contrasting attitudes in America and Europe.
The article suggests that yawning gaps in national budgets in Europe have been an added persuasive influence in liberalising markets formerly dominated by state gambling monopolies.
Other influences are the European Union's insistence on free movement of goods and services between member nations, and the determination of punters to give their business to internet companies that best meet their needs.
The article looks at the evolution of gambling attitudes in America and Europe, pointing out that in the latter as public finances worsen, governments are trying to bring a once-shadowy business into the mainstream of Europe’s digital economy, where it can be regulated and taxed.
“What’s happened is a realisation that you can’t uninvent the Internet,” said David Trunkfield, a consultant at professional business services firm PricewaterhouseCoopers. “People are gaming online. You either try to regulate and tax it, or people are going to go to the offshore operators, where you don’t get any revenue.”
The piece especially notes the significant changes in Denmark, Greece, Italy and France, noting that France, which only four years ago jailed the top executives of an Austrian Internet gambling company, Bwin, when they visited the country, last month permitted private companies including Bwin to start taking bets online, in competition with state owned gambling sites.
Denmark approved legislation in June authorising a similar shift, and Greece plans within weeks to introduce a bill legalising online gambling.
Others considering liberalisation include Switzerland, Spain and Germany, the New York Times notes, opining that these nations are all following Great Britain, which in 2005 became the first major country in Europe to confer respectability on the business, and Italy, which has been phasing in legalised Internet betting over the past three years.
"Europe has grown into the biggest online gambling market in the world, accounting for an estimated $12.5 billion of the industry’s $29.3 billion total revenue this year, according to H2 Gambling Capital, a consulting firm," the author avers. "If all of that activity were taxed, it could potentially raise billions every year, though the exact amount is hard to predict, given uncertainty over the tax rates that might be applied."
The article contrasts this progressive attitude with the situation pertaining in the United States, where federal govenment attempts to stifle most online gambling continue, although it remains a popular past time with US players.
It covers the UIGEA and HR2267, the latest attempt by Congressman Barney Frank to legalise and regulate internet gambling, along with intrastate efforts in Florida, California and New Jersey to permit online gambling, and the latest developments among Canadian provinces to benefit from a regulatory approach.
“I think the penny has dropped,” Simon Holliday, an analyst at H2 Gambling Capital told the New York Times with reference to the more enlightened European approach. “They deregulate a little bit, like what happens and deregulate more. The governments get more addicted to the tax than the players to the games.”
"France, which started allowing private companies to offer online sports betting just in time for the World Cup soccer tournament, said that in the first month gamblers opened more than 1.2 million new accounts, betting Euro 83 million, on licensed sites. That was nearly twice as much as the amount legally wagered online in the comparable period a year earlier, when state-run betting sites were the only option. As of this month, those numbers should rise further, with the start of legal online poker."