European Online Gambling Firms Want Into U.S. Market: Hopes Are High
Nearly all European online gambling firms, including the poker sites, have shied away from the U.S. market for the past 3 years following passage of the Unlawful Internet Gaming Enforcement Act (UIGEA) back in October 2006. The first step towards appealing that law took place Wednesday with a markup in a House subcommittee. Now it’s off to the House and Senate where further amendments are likely.
Those European online gambling businesses that operated in the U.S. prior to October 2006 lost billions after pulling out. PartyGaming, the biggest online poker room at the time, watched helplessly as more than 70 percent of its customer base evaporated, practically overnight.
Party is one that hopes to hit the jackpot in the States again. On Thursday they announced a merger with Austria’s Bwin that would make it one of the largest Internet gambling companies in the world. Bwin has never operated in the United States. PartyGaming has been in talks with the U.S. Government over potential entrance back into that market once legislation allows for such an option.
Online gambling firms throughout Europe reacted positively to the news about both the bill’s progress and the proposed merger of Party and Bwin.
Shares in PartyGaming rose 12 to 269p, 888 was up 1¼ to 47¾p, Playtech moved 31½ higher to 441¼p and Sportingbet climbed ¾ to 57p.
"It is probably the most positive step towards the reopening of the US online gaming market since 2006," said Simon Davies, an analyst at Collins Stewart.
“Prior to passage of UIGEA, few European online gambling businesses allowed customers from the U.S.,” Payton O’Brien, Senior Editor of the Gambling911.com observed. “Most were on the poker side. England’s biggest bookmaker Ladbrokes was considering entry into the U.S. just before the law went into effect. The vast majority of European companies feared the uncertain legal environment in the States. This new measure, should it pass, will open the floodgates, at least for the poker ventures. “
Industry analysts are hopeful the legislation will pass on the basis that gambling can help boost the economy. A recent study forecasts internet gaming could generate $42bn in tax receipts over the next 10 years.
Christopher Costigan, Gambling911.com Publisher
