Massachusetts Internet Gambling Forum: Panels 1 & 2

The Massachusetts Gaming Commission hosted a day-long forum on Internet gambling at the Boston Convention and Exhibition Center last week.

The forum consisted of five panel discussions, with noted speakers representing virtually every corner of the iGaming industry as well as regulators from all over North America.

Below are the highlights from the first two panels at the forum.

Panel 1: What are Internet and social gaming?

The first panel got the day started with a brief overview of what online and social gambling are, as James Stern of IGT/DoubleDown and Jeff Allen of Bally Technologies explained the basic mechanics of online gambling websites including a demonstration of both social and real money casino games, poker among them.

Here is a look at the interesting bits of information revealed during James Stern’s presentation:

• Stern fired off a couple of very interesting demographic figures, telling the MGC that 65-70% of players on their social casino sites are female, and 65% of players are over 35. This definitely signals that there are two major untapped markets for real money gambling, but the question as to how to convert social players to real money players remains.
• Stern cited Price Waterhouse Cooper, saying that in Europe online gambling is a $15 billion industry.
• According to Stern, only 3% of social casino users purchase additional play money chips. The remaining 97% use the site purely for free.

Here is a look at a few of the insights from Jeff Allen’s presentation:

• Allen illustrated the stringent registration process for a real money online gambling site (he used Golden Nugget Casino in New Jersey for the demonstration), which includes date of birth, address, Social Security number, and phone number. Allen described how all of these pieces need to match for a player to be approved.
• Allen also showed how a player can set deposit and wager limits, as well as self-exclude directly on the site.
• As many panelists would do throughout the day, Allen touched on payment processing difficulties, calling the current climate one of “weariness” among credit card companies and banks.
• Another theme that would be repeated throughout the day was driving online players to land-based casinos and vice versa. Allen described efforts to link bonuses and loyalty rewards together and give players incentives to patronize both online and brick and mortar casinos.

What you might have missed during Panel 1

The Golden Nugget in Atlantic City is offering prepaid credit cards that players can use for both depositing and withdrawing from the company’s online casino. This is an interesting solution to the current payment processing troubles, and something other casinos might want to explore.

Bally Tech is partnered with several brick and mortar corporations in Nevada and New Jersey, and one of those partnerships expected to launch in the very near future is ACEPlay in Nevada.

ACEPlay is the online poker room of ACEP (The Stratosphere in Las Vegas) and Bally Tech.

During the demonstration the ACEPlay logo appeared in what looked to be a short list of current providers using Bally Tech, which leads me to believe the site may be up and running very soon – something OPR discussed earlier this week.

Panel 2: Status of Internet gaming nationally and around the world

Panel 2 also featured only two speakers, James Kilsby, the Americas Editor for GamblingCompliance, and Assistant Attorney General of Massachusetts Patrick Hanley.

Kilsby’s presentation focused on the current legislative climate. He offered four reasons for the deluge of online gambling bills since 2010:

1. A new interest in iGaming from companies that are now seeing the Internet as an opportunity and not a threat to their businesses.
2. Increasing comfort that the industry can be regulated.
3. Internet gambling is an activity states can now pursue under federal law. Kilsby stated that UIGEA opened the door for lawful Internet gambling due to its wording, and that the memorandum by the DOJ that altered their interpretation of the 1961 Wire Act gave states the green light to move ahead.
4. Potential for federal law.

Kilsby was followed by Patrick Handley, who is the Chief of the Gaming Enforcement Division for the Massachusetts Attorney General’s Office. Handley’s testimony was brief and to the point.

In a nutshell, Handley stated that although Internet gambling is not expressly prohibited in Massachusetts, the AG’s office certainly interprets it as such, using several older laws to blanket online gambling of any kind. Handley went on to note that these laws have been used to prosecute online bookies in Massachusetts in the past.

According to Handley, in order for online gambling to move forward there would need to be a carve-out for iGaming under current MA law.

What you might have missed during Panel 2

Kilsby brought up “bad actors” and the difficulty in setting standards for suppliers. This issue was revisited later on in the forum in much more detail.

A member of MGC asked Kilsby about the proposed Wire Act Fix being pushed by Sheldon Adelson, but did so without mentioning Adelson.

It appeared that the MGC member thought the bill had already been introduced, which prompted Kilsby to make the distinction that it hasn’t been introduced (it’s simply been proposed), but that a version was likely to be put forward sometime this year by “a South Carolina senator.”

Takeaways from Panels 1 & 2

These were the most fundamental of the day’s panels, but there was still a lot of interesting and useful information to be gleaned.

First, the two introductory panels set the tone for the entire conference, which had a “when” not “if” Massachusetts will legalize iGaming feel to the whole thing.

Second, we learned that this was not some talking points hearing; this was a serious discussion about iGaming.

Finally, in offhand comments we learned that there is a lot of talk about online gambling behind the scenes, and states like Massachusetts may be a lot farther along in the process than we realize.

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