How quickly things change. Long on the fence regarding regulating online gambling in the U.S., Senate Majority Leader and long-time Nevada politician Harry Reid is reportedly now openly endorsing a plan to “amend” the UIGEA and get regulated Internet poker up and running.
A new bill, still in an early draft phase, was drawn up over the weekend and is now being pushed by Reid in hopes of passing before the end of the year, to take advantage of his greater influence during this final “lame duck” session of congress. Read the full bill here.
The legislation Reid is proposing would “allow poker games over the Internet but restrict initial licenses to casinos and racetrack operators that have been in businesses at least five years,” reports the Associated Press.
Unlike Barney Frank’s previous attempts to regulate online gambling, this is taking place in the Senate, not the House, and has the support of the actual Senate leader, whereas Frank never enjoyed that level of support in the past.
“Like the Barney Frank-sponsored bills that have come before, Reid’s bill also proposes a way to license and regulate online gambling in the United States — that is, to allow operators to set up shop here in America, if they play along with all the provisions and secure themselves licenses to do so — one big difference being that Reid’s bill only allows for poker and not other forms of gambling,” explains hardboiledpoker.com.
An interesting addition from the AP article: “Under the draft legislation circulated to various Senate offices, states and Indian tribes would oversee regulation of the online poker license-holders.”
This is probably a result of earlier reports that Harrah’s — or, rather, Caesar’s Entertainment — was pressuring Reid to work to legalize and regulate online gambling.
And the company reportedly has the leverage to do this, since it contributed heavily to Reid’s political re-election campaign, which the senator won last month. The CEO of the land-based casino heavyweight, MGM, for example, personally appeared at a rally for Reid in Nevada, praising the senator’s success at job creation.
Therefore, MGM also put the pressure on Reid. “MGM VP Alan Feldman confirmed the company’s continuing interest in Internet opportunities without making any direct comment about what MGM might have been involved in last week, ‘but only if it is the right kind of bill with the right kind of legislation… We’d almost rather not see it passed than have it be the wrong kind of bill,’” reports blogger Phil Hevener.
Pay attention to the phrase “the right kind of legislation” … what’s it mean? These big companies will certainly want a greater legal advantage over smaller or international competitors.
If this is the way online gambling gets regulated in the United States, it may also mean big shifts in casino affiliate marketing, with different brands rising to power and some of the smaller (and European-based) casino brands losing out on the chance to market to American players.
Of course, the opposition is already working against the bill, with three leading Republicans already telling Reid they’ll oppose his plans.