Video of the signing ceremony is available here, or you can watch it below:
The Multi State Internet Gaming Association (MSIGA) is created as a result of this agreement. The MSIGA is a Delaware LLC that is basically seeking to be the hub for interstate online gambling.
The MSIGA will set minimum standards and otherwise help to guide policy development related to online gambling regulation.
Membership is open to other states. Sandoval and Markell stressed repeatedly that the MSIGA welcomes additional members and is designed to be extremely flexible to accommodate the needs of other states.
No firm date was set. Both Sandoval and Markell asserted that the agreement required no additional regulatory approval.
According to Markell, the only remaining hurdle to implementation is on the technological side.
888 – who will be a key player in this agreement as the only operator in Delaware – developed their US platform with compacting in mind.
So liquidity sharing could theoretically begin in a matter of months, a timeframe that has been echoed by a few sources on background.
One potential wrinkle to the agreement that was not addressed during the meeting: What rooms are going to share liquidity?
In Delaware, 888 is the sole operator and powers all three Delaware online poker brands (which all feed into the same player pool). But 888 does not have a live room in Nevada. They have plans to launch, but no firm launch date as of yet.
888 does provide the platform for WSOP.com’s online poker room in Nevada (and in New Jersey). But in New Jersey, 888 and WSOP operate separate networks (The All American Poker Network and WSOP.com respectively) despite sharing the same software platform, an arrangement most expected to extend into Nevada.
Mitch Garber, CEO of Caesars Acquisition Company, said in an email that his company will “now take a real look at Delaware as well” following the signing of the agreement.
Garber described the agreement as “a very important milestone.”
“If you think about how quickly three states have legalized online gaming,” Garber continued, “and how quickly two states have reached a compact on sharing liquidity, this bodes well for future state legalization and future inter-state collaboration.”
Today’s announcement of Nevada and Delaware entering into online poker agreement (i.e. compact) whereby the two states will share player liquidity (revenue will be distributed evenly based on location of player that generated rake) is symbolically important; however we expect the financial implications for both states to be negligible.
I personally think that Delaware will see substantial gains in poker as a result of this agreement, but their overall poker number is so low that even substantial gains would be negligible in an absolute sense.
While Sandoval and Markell spoke of the benefits to their individual states, it was clear that the focus of the agreement was the expansion of MSIGA to include additional members.
Obviously New Jersey is the only other state offering online poker and casino games at this point.
When asked if he had invited New Jersey to join, Sandoval responded that he has had conversations with New Jersey and that they would love to have New Jersey on board, but did not elaborate beyond that.
If New Jersey comes on board – and that’s a big if, for a number of reasons – what would be the impact on the existing online poker market in the state?
The big winner would be WSOP.com who would immediately leapfrog Party/Borgata for the top traffic spot in New Jersey thanks to the roughly 60% bump the addition of WSOP.com’s Nevada traffic would provide.
Another winner: Ultimate Poker, who would both shore up their Nevada room and – perhaps more critically – breathe life into their New Jersey operations.
But that’s all speculation. There’s a reason why NJ was absent from the ceremony today, and a number of reasons why they may never partner up with New Jersey and Delaware, as Joe Brennan Jr. concisely noted:
NJ will see the DE/NV "hub" strategy as a challenge to their own; not likely to join anything where they're not the "big dog" & empowers NV.
— Joe Brennan Jr (@joebrennanjr) February 25, 2014
The skeleton of MSIGA is laid out in a 13-page document which you can review here. Below is a brief summary, article by article, of the points likely to be of most interest to online poker players.
Article 1 is the Title. Article 2 lays out the Purpose of the agreement and Article 3 covers the Definitions. There’s not too much of note here:
Article 4 covers Requirements to Join, while Article 5 outlines the Operation of Internet Poker and Other Internet Gaming.
Article 6 details MISGA’s approach to Internet Gaming Revenue.
Article 7 covers Governance, and Article 8 deals with Cooperation and Transparency.
Article 9 covers Data Protection and I’m not completely certain if there’s anything of note in there. Article 10 outlines the Dispute Resolution policy for MSIGA, which seems pretty standard. The one odd part involves what happens when there’s a player dispute involving players in two states when a licensee is licensed in both states. As I read it, it’s unclear whose rules trump whose in that case.
Article 11 (Amendments to this Agreement) reveals that amendments require 2/3rds vote, or unanimous consent if there are only two members. Article 12 (Withdrawal/Expulsion from this Agreement) details the process for being booted from MSIGA; that requires 60 day notice and a 75% vote. Article 13 (Termination of this Agreement) says that unanimous consent is required for the agreement to be terminated.
I certainly could be missing something, but the remainder of the articles appear to be largely boilerplate.
This section lays out the minimum standards prospective members must meet. It’s very brief, taking up a bit under two pages. Some points of interest: