Online gaming comes to Nevada
In February , Nevada became the first state to approve online gambling. Delaware and New Jersey quickly followed suit, and more states are weighing some kind of online gambling legislation.
Casino owners and the technology companies that service the industry have been waiting for this decision.
“In the past two years, because of pending national approval of online gambling, Bally Technologies has increased Las Vegas employment by more than 200 people,” said John Connelly, vice president of business development for the company. “Additional state regulatory approvals of online gambling and improving mobile applications will increase the size of our online gaming division, which we call Bally Interactive. Two hundred hires may increase to 1,500, depending on market growth.”
In June 2012, Bally Technologies became the first company to receive an interactive gaming supplier license from the Nevada Gaming Commission. Since then, gaming authorities have licensed a number of casino operators and technology providers.
Las Vegas-based Bally Technologies has been at the forefront of casino gaming since its beginning in 1932. The company offers a wide range of technology and entertainment solutions to casinos around the globe. Services to the casino industry by Bally Technologies include gaming machines, mobile applications, iGaming platforms, casino-management systems and player-marketing solutions.
More important , it is at the forefront of online gambling as it gains approval in the United States. With Bally Technologies early entry and experience in electronic gaming, the advent of the Internet became a superhighway for expansion of the company’s business.
“Bally Technologies extends services to casinos and online gaming companies around the world,” said Connelly, who added the company has several international offices. “We have offices in Amsterdam, Rome and London, to name a few.”
Connelly thinks online gaming will have a positive effect on casino table games. “Online gambling is another way of reaching the customer, and its growth will complement the casino customer base,” he said. “Online poker will educate customers about the joys of the game.”
American Casino & Entertainment Properties is another locally based company that has been preparing for Nevada’s approval of online gambling.
“ACEP has been gearing up for a rollout of online gambling for the last two years,” said Alec Driscoll, director of gaming development at ACEP, which owns the Stratosphere and Arizona Charlie’s in Las Vegas and the Aquarius in Laughlin .
“ACEP researched the market, particularly in Europe where online gambling is legal, to prepare for a launch of our own online gambling website in the United States,” Driscoll said of www.acePLAY.com.
AcePLAYpoker.com rolled out in February .
“It is presently a no-money website but pending regulatory approval, we plan to become a pay-for-play online gambling site,” Driscoll said. “The website launch is a great promotional tool for the brick-and-mortar casinos.”
Players can access acePLAYpoker.com directly or through American Casino’s website . The launch offers an educational experience for players wanting to know more about casino entertainment and gambling.
“Right now, our focus is on Nevada, but we have plans to expand our online poker site as more states approve online gambling,” Driscoll said.
“Online gambling has been around for a long time, but is, just now, beginning to be legalized in the United States,” he said. Before legalization in Nevada, online gaming was a “gray market” because its base operations were outside the United States.
Online gaming dates from 1969. Its success is limited by technology and significantly influenced by government regulation.
The upper limits of technology have been pushed higher with programming platforms that connect people to play games. Beginning in 1958 with William Higinbotham’s “Tennis for Two,” gaming on a monitor (actually an oscilloscope screen) became a local opportunity. By 1980, local game-player opportunities morphed into international game-player connections; video games became valuable copywriter-secured assets, such Atari’s “Asteroids” and “Lunar Lander.”
With the advent of the Advanced Research Projects Agency Network, known as ARPANet, the precursor to the Internet that linked the University of California to the Stanford Research Institute in 1969, the potential for gaming became national. With the creation of a common computer language in 1973, local networks combined to create the Internet. With the advent of the Internet, a worldwide opportunity became possible for online gaming. In the background of this new environment, online gambling was introduced to the online entertainment world.
In 1994, Antigua and Barbuda in the Caribbean passed the Free Trade & Processing Act that provided for online licensing of casinos. Internet gambling sites increased from 15 in 1996 to 200 in 1997, according to Wikipedia. A global industry consulting company, Frost & Sullivan, reported that online gambling revenue exceeded $830 million in 1998.
Christiansen Capital Advisors , which focuses on gaming and wagering , said that 23 million people participated in some form of online gambling in 2005 on an estimated 2,000 websites. A November report by Global Casinos & Online Gambling estimates 2012 revenue from casino and online gambling is nearly $127 billion. An estimate from IntellogiX Gaming Network projects that $17 billion to $19 billion of that $127 billion is from online gambling.
The United States is a latecomer to online gambling with its first online site beginning in Las Vegas . The first licensed online gambling site in the United States was launched by Fertitta Interactive LLC. Fertitta Interactive was founded in 2010, but a real-money online poker site had to wait until December 2011 for Nevada’s approval of online gambling. On April 30, Ultimate Poker.com was launched. The Golden Nugget and Station Casinos were its first clients. ( To learn more, visit www.ultimategaming.com/ultimate-gaming-news/.)
Fertittta Interactive is blazing a trail . In 2011, when it purchased the Oakland, Calif.- based company, Cyber/Arts Licensing LLC, it became a self-sufficient, vertically integrated online gambling enterprise.
Other Las Vegas-based casino owners have taken a different road.
American Casino, Caesar s Entertainment and MGM Resorts International partnered with outside companies that have developed proprietary online gambling platforms. American Casino joined with Global Technologies. Caesar s chose 888 Holdings PLC, a Gibraltar-based company that works with online casinos in the United Kingdom; and MGM announced plans to work with Bwin, the world’s largest publicly traded online gambling company .
Both 888 and Bwin incorporated in Gibraltar in 1997 and both are publicly held companies. Bwin, in terms of employment, is the largest with an estimated 3,000 employees worldwide.
Nevadans are at the beginning of a new era of online gaming. Station Casinos is focusing on creating a local brand of online poker with www.ultimategaming.com, while American Casino, Caesar s Entertainment and MGM Resorts are partnering with international gaming companies to pursue worldwide appeal.
A common thread in casino online gaming websites (both pay-to-play and no-money gaming ) is public introduction to respective casino entertainment networks. Everything from education in the art of gambling to player benefits to pictures and explanations of casino amenities will be advertised on online sites. Online gambling sites may offer many of the same players’ benefits that casino visitors are eligible for when they play at the casino.
“Online gambling is a job creator that complements the casino industry,” said David Schwartz, director of UNLV’s Gaming Research Center. In addition to software programmers and service providers of online gambling, ancillary businesses such as geo-location companies will grow, he said.
Among growing companies is Bally Technologies, which has more than 1,000 employees in Nevada.
“Bally Technologies offers economies of scale to both large and small customers that are processing the complex activities of the gaming industry,” Connelly said. “We have been serving the casino industry for more than eight decades.”
Job searches for Bally Technologies are often worldwide because of highly specialized needs of the company, he said. But “we also hire employees straight from college and have on-the-job training and continuing education programs to meet present and future needs of the company.”
Bally Technologies provides back-office services to 90 percent of Atlantic City casinos and contract services to mega casinos such as Mohegan Sun and Foxwoods in Connecticut.
Taking a peek at Bally Technologies’ job website, ballytech.com/careers/ , there are openings for customer service, information technology, human resources, software development, project management and engineering.
Opportunities exist at other companies, too.
“ACEP’s entry to online gaming has required a great deal of research, re-education of employees and hiring of new employees to serve what is expected to be a significant marketing opportunity,” Driscoll said. “We talked to operators and employees in other countries and contacted local companies like Bally Technologies to see what they could offer that fit ACEP’s corporate objectives.”
American Casino chose to create a separate company that would offer online gaming, initially as a marketing tool for its brick-and-mortar casinos. The longer term objective is to become a licensed gambling website.
“ACEP decided to use Bally Technologies’ gaming platform to initiate ACEP’s entry into the online market,” Driscoll said. “No date ... has been set for launching (its) real-money online gambling site but it is a high priority for the company.
“In the meantime, acePLAYpoker.com has been a great marketing tool,” he said.
“With New Jersey’s and Delaware’s approval, the history of online gambling is still being written,” Schwartz said. “New Jersey and Delaware’s approval of online gambling includes other casino games while Nevada’s approval is for online poker only.”
Every state may have a different model for online gambling approval.
“Online gambling will increase casinos’ gaming revenue and the state’s tax collections,” Schwartz said, although it is too soon to know how big the increase will be.
Long-term investors such as Global Technologies may have a jump on the online gaming market but relative newcomers such as Fertitta Interactive, 888 and Bwin are focused competitors that are keen to be the best. To Nevadans, entrepreneurs that create jobs are just what the economy needs.
