Reid Bill Update and Tony’s unfiltered post on 2+2

Update 1:00pm CST: Despite a report by the Las Vegas Sun last night, the Reid Bill is still alive and kicking. The Reid Camp said the Senator’s quotes in the Sun article were taken out of context and that the bill is still alive so the Sun was forced to retract their story. Republicans are publicly stating the bill has no shot to get attached to the Bush Tax Cuts while the Reid Camp is working hard to find a middle ground. Mainstream media sources like Forbes and FoxBusiness are now covering the story. Even Bloomberg weighed in on how the possibility of a US Poker Bill is affecting BWIN’s stock.

I posted this in the Legislation Forum on 2+2 last night and figured our blog readers might want to read it.

I guess I will throw my two cents into the discussion.

Long time poker player turned internet marketer, I got into the business side of the poker industry about 2.5 years ago. I work for a marketing company who’s core business has been online poker for quite some time (we have recently expanded into other industries). I go to the gaming conferences in Europe, talk to the poker rooms on a daily basis, and have poker room owners I chat with who will speak candidly with me at times.

As ZBhorton’s source pointed out, the cat (US Govt) and mouse (poker room processors) game is an integral part of this industry. It has become increasingly harder for rooms to partner with processors who 1. have clean track records and 2. can facilitate the volume and nature of their deposits/withdrawals.

The deposit/withdrawal game has changed significantly in the last 12 months. The DOJ understands there is gray area in the UIGEA and I believe is not willing to risk losing a case against a room because of the precedent it would set (and because they are arrogant). So they have invested their time and effort into higher converting cases against processors, where the law is a lot more black and white. We will see more and more processors shut down, and at a much higher frequency than before. Which in turn, will make it much harder for players to deposit.

I do believe FTP and Stars support this bill. Their execs aren’t stupid and can see the writing on the wall. Their time in the US market is limited. Their best shot (revenue wise) is to sell or partner with US gaming companies. At the very least, they could get hefty consulting or software contracts.

While Stars, FTP, and PPA have their seat at the bargaining table, it’s a high chair compared to the seats owned by Las Vegas. The US Casino industry has had deep ties in DC for a long time. It truly is David (stars/ftp/ppa) vs. Goliath (US Casinos). Because of this, I believe there is little chance that stars or ftp are allowed back into the US market without Las Vegas having a substantial edge: 2 year head start, different regulations, etc.

This is first and foremost a Las Vegas bill. It will be written for their benefit. If the Reid bill doesn’t pass we will probably see similar bills with similar verbage: blackout periods, no stars/ftp, state opt -in (imo it’s a must for a bill to pass), etc. I do think this bill is our best shot at regulation for quite some time. We desperately need it to preserve the games and to also protect our individual freedoms.

Ok, back to sweating this bill and wearing out my F5 key.