Las Vegas Strip casino resort giant MGM Mirage has for some time been the most vocal proponent of legalized Internet gambling being offered by Nevada casinos.
Just weeks ago Nevada finally responded, when the legislature passed a bill that authorizes the Nevada Gaming Commission to approve Internet gambling in Nevada under certain conditions. Starting this month the commission will begin the process of making that decision.
But MGM Mirage is making it clear it wants into Internet gambling sooner rather than later — and may go overseas to become a part of what is now a $3 billion-plus gaming market.
“The Nevada legislation . . . empowers the commission to act, should Internet gaming be deemed legal by the federal government,” said MGM Mirage President and Chief Financial Officer Jim Murren. “Who knows if or when that’ll ever happen?”
Murren said the Las Vegas-based gaming giant is now “scouring the globe,” examining different jurisdictions that now allow Internet gambling. If MGM Mirage finds an overseas jurisdiction with tough regulatory standards — and can be assured it can block would-be bettors from areas that don’t allow Internet gambling — the company may open an online casino there, even before Nevada legalizes Internet gambling, Murren said.
“We won’t do anything that would jeopardize the billions of dollars we have invested in the ground (across the United States), the billions of dollars in equity in our brands and our licenses,” Murren said. “We’re taking an extraordinarily conservative approach to this. But again, we’re a leader in this industry, and there are certain responsibilities that come with being a leader. It would be equally irresponsible of us to do nothing and not to understand this. I don’t think that’s what leaders do.” More about Situs Slot Deposit Pulsa Tanpa Potongan
But it’s also hypothetical at this point, Murren added.
“It’s a possibility. I wouldn’t call it a probability at this point,” he said. “I would say 90 percent of the jurisdictions out there we wouldn’t touch with a 10-foot pole.”
Nevada’s top gaming regulator declined to say whether he’d approve of such a move.
“There’s nothing (in Nevada’s gaming regulations) that prohibits them from conducting such activities,” said commission Chairman Brian Sandoval. “Certainly if MGM does it, it would seem likely other licensees would seek to do the same thing … so it’s real important (to look carefully) at the first licensee to ensure we’ve reviewed all relevant legal issues. Certainly it’s an issue at the forefront, that I will review with Chairman (Dennis) Neilander (chairman of the Nevada Gaming Control Board).”
No Nevada gaming company has ever offered for-cash casino games on the Internet, Sandoval said.
Currently, MGM Mirage operates a not-for-cash Internet gaming site through WagerWorks Inc. Though players can win comps at MGM Mirage properties by playing, their prizes are determined by the time they spend on the site, not on the outcomes of the games — a concession MGM Mirage made to the concerns of the state attorney general’s office.
The biggest legal issue facing Internet gambling is its legality under U.S. law. The Department of Justice holds that Internet gambling is illegal under the federal Wire Act, but a recent federal court decision in Louisiana held that this was not the case. The decision is now on appeal before the Fifth Circuit Court of Appeals in New Orleans, and it’s expected this decision will provide a significant amount of guidance to Nevada regulators as they consider the issue of Internet gambling’s legality.
Only one Nevada gaming operator has previously offered Internet gambling overseas, and it was an effort that met with disaster.
In early 1999 American Wagering Inc. of Las Vegas launched “Megasports,” an online sports book based out of Australia. AWI is best known in Nevada as the operator of the Leroy’s chain of sports books. Former board Chairman Steve DuCharme told AWI it could proceed, so long as the website accepted bets only from jurisdictions where Internet gambling was legal.
Less than a year after opening Megasports, AWI was hit with a 13-count complaint by the control board, following a sting operation by board agents. Using a bogus name and a Canadian Internet service provider, a board agent was able to place 12 wagers on Megasports from Nevada. Upon discovering where the wagers came from, AWI rescinded all bets and tried to return the $100 deposit, but the control board in December 1999 filed a complaint accusing the company of “fail(ing) to exercise discretion and sound judgment to prevent incidents which might reflect on the repute of the state of Nevada and act as a detriment to the development of the gaming industry.”
In July 2000, AWI settled the complaint. It agreed to pay a $10,000 fine and sell off Megasports.
As a result, caution on Internet gambling is the watchword with many gaming companies.
Harrah’s Entertainment Inc., for example, would not consider moving into Internet gambling before Nevada authorizes it, said spokesman Gary Thompson.
“We’re not going to jeopardize our licenses in the United States,” Thompson said. “There are a lot of issues that have to be resolved, not the least of which is (Internet gambling’s) legality in all the jurisdictions in which we have bricks and mortar facilities. We have a large investment in those properties, and we’re not going to jeopardize that while the legality’s not clear.”
If these issues are resolved and Nevada authorizes Internet gaming, “I think we’d certainly take a very serious look at becoming a player in it, but we haven’t made any decisions at this point,” Thompson said.
But Murren also insists MGM Mirage isn’t going to put its U.S. casinos at risk, either.
“We wouldn’t open up anywhere without the full knowledge and support of Nevada and everywhere else we operate,” Murren said. “If we sit down and have substantive conversations (with gaming regulators), and they have legitimate concerns that we feel we’re unable to cure, then I can’t see us proceeding. But that’s putting the cart so far ahead of the horse that it’s not even in sight.”
