iMega Responds to "Really a Friend of Online Gambling?" Article
It was disappointing to read, on the same day iMEGA decried the FTC's lack of action to ensure Net Neutrality - and to protect individuals and Web publishers from potentially harmful and non-competitve practices by broadband Internet service providers (ISPs) - Ms. Jennifer Reynolds' guest column on Gambling 911 (See:
iMEGA: Really a Friend to the Internet and Online Gambling?).
This is due in no small part to the complete mischaracterization of iMEGA and our willingness to work constructively and cooperatively with government, to ensure that government regulation of the Internet is both rare and does not intrude on personal liberties.
Our complaint, filed in US Circuit Court (iMEGA v. Gonzales, et al), outlines our commitment to the fundamental rights of the individual in the Digital Age. I invite all who have an interest in the current state of affairs between the i-gaming industry and the US government to read the complaint.
In fact, Ms. Reynolds herself spends no time in her column examining iMEGA's suit versus the US government. Instead, she (admittedly) leads readers on a number of flights of fancy, sketching Orwellian scenarios of Big Brother-like intrusion of the privacy of individuals under an imagined regulatory scheme, proposed by...whom, exactly?
Certainly not iMEGA. That's for sure.
I respect the ideological purity of a libertarian like Ms. Reynolds, if not her practicality. The libertarian's core principles are valuable for providing an antagonistic, balancing force in our political system. In this specific instance, though, Ms. Reynolds' zeal in attacking iMEGA belies perhaps a lack of historical perspective, as well as a limited understanding of many of the factors she mentions to support her own arguments.
As those familiar with the history of the Internet's founding know, it is impossible to keep government out of the Internet, because it was the US government that created the it in the first place.
The US government maintains a large role in protecting the Internet's infrastructure, maintaining security, and even the oversight of ICANN. The governments of the UN, the EU, the CIS and other nations all play roles - large and small - in the day-to-day health and security of the Internet. This is the reality of the situation. There has never been an Internet free from government. Ever.
So, since government is here, it must be dealt with, if only to prevent it from encroaching on individual rights, as is the case with UIGEA.
iMEGA believes that with this law, the US government has arbitrarily and capriciously encroached on our personal liberty, creating a slippery-slope precedent from which other online media and entertainment models - like social networks, video games and online personals, for example - can be attacked. As such, iMEGA believes that the law cannot be allowed to stand, and that it will not pass constitutional scrutiny.
But Ms. Reynolds' column was not about this. Instead, she focuses on the topic of "regulation", for which iMEGA has offered no proposals. Why haven't we? Because with our limited resources, we're focusing on overturning an unjust law right now. There are other lobbyists focused on regulatory legislation, such as that proposed by Rep. Barney Frank (D-MA).
But since Ms. Reynolds - at great length - paints iMEGA with such a fanciful, sinister brush, I will briefly address her accusations.
Ms. Reynolds asserts - without any evidence, mind you - that iMEGA "support[s] massive government interference in the Internet", condemning us for the "vile Internet restrictions that [iMEGA] seeks."
Wow! Well, that's news to us, since we would never support "massive" government measures, and we've certainly not proposed any "vile" restrictions.
Ms. Reynolds bases her suspicions regarding iMEGA on a quote by Edward Leyden, iMEGA's president, in our press release announcing our filing in US Circuit Court this past June 5th:
“Two major benefits come immediately from U.S. recognition and regulation of Internet gaming; transparency and tax [WINDOWS-1252?]revenues,” said Leyden.
Ms. Reynolds omits the second half of Mr. Leyden's quote, regarding "transparency" of licensed operators, to prevent fraud against individuals:
“As with the U.S. financial markets, transparency assures that broad access to relevant data and the balancing forces of a free market all operate to maintain fairness and prevent corruption."
In other words, operators that engage in fraud and other crimes need to be weeded out of the marketplace, to protect players and reward honest operators. Does Ms. Reynolds object to that? Or should caveat emptor - "let the buyer beware" - be the rule of thumb in a Darwinian marketplace?
Ms. Reynolds blanket dismissal of any regulation is - besides being out of step with the prevailing sentiment of operators in the market - naive. The default position of libertarian purists is that all regulations are an assault on liberty.
How about the Clean Air Act? The Civil Rights Act? Anti-Trust Acts? Surely, their regulations must be to the benefit of individuals?
It is ironic that Ms. Reynolds uses the Enron collapse as an argument against regulations, since it was not the abundance of regulation, but rather the lack of regulation, that was a contributing factor in Enron's meltdown. The deregulation of the energy markets, coupled with independent auditors selling consulting services to the very firms they were supposed to be keeping watch over, lead to massive fraud within the firm and the loss of billions of dollars.
The Enron collapse lead Congress to pass the Sarbanes-Oxley Act, which has lead to much tighter regulations on financial reporting for corporations, and protecting individual investors.
Just the other day, after months of investigation and lobbying by groups like Save the Internet, the FTC offered no regulations to ensure Net Neutrality which would have protected consumers and publishers. Now, ISPs are free to make business deals and restrict bandwidth to create marketplace advantages for their products versus independently produced products, and determine for themselves what online content should be prioritized on available bandwidth.
Would Ms. Reynolds suggest that the absence of Net Neutrality regulations led to a good outcome in that case?
Frankly, iMEGA has not spent much time on possible regulation and taxation schemes for the i-gaming industry. Our focus has been on the fight against UIGEA. When we mention it, we are only stating the obvious, a reality that is apparent to most within the industry. To think that government is going to withdraw from the Internet...well, that's just a Utopian fantasy.
iMEGA does not support Big Brother following you around the Web, keeping track of what you do, what you read, etc. Any suggestion to the contrary is simply untrue. If operators issued 1099 Forms on players' winnings (or losses), that would seem to be enough. That's what the brick-and-mortar gaming industry does - No Orwellian/NSA spying needed for that.
The reality is that the responsible position is to recognize and work with the 600 lb. gorilla in the room, and to ensure it interferes as little as possible with the garden of the Internet. Innovators and entrepreneurs must be given room to grow, and individuals the freedom to explore the garden as they see fit, without fear.
Not engaging with government over these issues may be a "moral victory" for an ideological purist, but in the real world, that's not how things get done. While we appreciate Ms. Reynolds' sentiments regarding the hopeful success of our lawsuit, I would suggest that her wish for our subsequent demise is short-sighted and a bit mean-spirited.
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As an aside: It's funny. In the month since iMEGA announced our complaint in US Circuit Court, we've encountered some "interesting" rhetoric about ourselves. I've been called a "tool for Antiguan operators", an agent provocateur for the US government, "mysterious", and - perhaps funniest of all - "well funded" (though our supporters have dug deep to help us out).
I will tell you that the truth is much simpler (and, perhaps, more mundane) than any of that. iMEGA started with a handful of people who looked at this law (UIGEA) and felt it was unjust, and that, worse, it could be a pretext for assaults on other Internet models. Since last September, we've worked hard to pull together what we thought was the best chance for success - a challenge to UIEGA in Federal court - and then worked hard and talked with a lot of people to build support for our effort. We still have so much work to do.
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Joe Brennan Jr., Special Contributor to Gambling911.com
iMega Responds to "Really a Friend of Online Gambling?" Article