Predictions for U.S. igaming market in 2011-2012

The U.S. market and casino affiliate marketing are best summarized in one word: Regulation.

Online gambling in the U.S. is completely tied up in the country’s lack of regulation. The industry makes too much money for it to go unregulated and unlicensed (thus, largely untaxed) much more in the future.

And yet, certain American political elements — and competing commercial interests, like the NFL — are dead set against online gambling regulations there. The NFL spends money lobbying against online gambling regulations. There are connections to Vegas casinos, with their near-exclusive corner on sports betting in America, and the many fantasy football networks that have sprung up in recent years, too.

So, although European financial experts expect online gambling regulations to happen this year, it’s far from a certainty.

Financial incentive
But it is a likelihood. And for one very big reason: Governments need money badly now, and online gambling taxes would be a cash cow.

Steve Bulwa over at recently wrote a lengthy, highly informative analysis of why regulated online gambling must happen in the U.S.

“Macau had 25 million visitors in 2010 while according to comScore 32 million U.S. residents visited online gambling sites in the month of October 2010 alone,” Bulwa wrote.

“That was up 114% from the previous month and in an environment where it is still illegal and very difficult to deposit funds at gambling sites.”

State-by-state, or national?
And so, while online gambling remains unregulated in the U.S., casino affiliates must navigate a confusing maze of regulations and markets.

Lawmakers are finally coming over to the wisdom of regulated and licensed online gambling on a state-by-state basis, but laws that offer national regulation would be more beneficial to casino affiliates.

Why? Because state systems would tend to allow only companies within those states to offer online gambling. So international brands like PokerStars, Full Tilt, iPoker, and most of the others would be shut out. And there goes the affiliate marketing plan for most existing casino affiliates.

So, affiliates have a stake in supporting national online gambling laws — unless you’d rather take your chances on whatever new casino affiliate marketing programs are created from all the new local companies.

A solution will come, but when?
All this turmoil isn’t necessary, and it’ll soon be obsolete. So, the biggest prediction for 2011 is that, by the end of the year, online gambling regulations will be much more advanced than they are today, either in a new state-by-state network or at the federal level.

Companies like PartyGaming and bwin are already concentrating efforts on entering a regulated U.S. online gambling market, and many other European brands are expected to benefit greatly from new U.S. laws, as well.

“We expect to see legislative change implemented and licenses granted in 2H11 or early 2012,” states Michael Campbell, analyst for Daniel Stewart.

That’s optimistic, but also realistic. Even if it’s just more states jumping on the bandwagon, look for the online gambling laws in the U.S. to be a lot different in 2012 than they are now, in February, 2011.