A law known as the Wire Act was implemented in the U.S. in 1961. In the last five decades interpretations of this law, forbidding betting transactions through technology, have created a gap in the market for one of the wealthiest countries in the world…
Federal authorities acting under the jurisdiction of the Wire Act consistently put the red line through online gambling outfits in the United States. As a result, the U.S. hasn’t had an easy time of it, even state lotteries have been in danger of being shut down. Forget about brick-and-mortar casinos in parts of the U.S. outside of Las Vegas, they too have had to step lightly when it comes to betting transactions online. Because of it, online casinos moved their operations off-shore to countries without the law, many of them in the United Kingdom. Gibraltar has also been an attractive base for online gaming companies given the tax benefits available.
Online casinos and sportsbooks operating out of the U.K have been enjoying healthy profits post-Wire Act, but their market share could soon be in jeopardy. The Wire Act has recently come under scrutiny and has been further clarified, allowing the states to make their own decisions about the allowance of these types of businesses. Which states will allow such transactions has yet to be decided, but the new interpretation of the law has left the windows wide open for the possibility of reaping in major profits. The only caveat being that any state laws enacted apply only to state residents and the business that operates out of that state.
Michael Charalambous, Managing Director of LiveCasinos.co.uk, has some prescient words to say about the matter as well as a little bit of advice concerning the changes that could take place. He says:
“This is big news for gambling companies based in the States, who previously had their business restricted to traditional casinos… 2012 will be the year of online gaming in America”.
He goes on to say that companies in the U.S. who wish to create a strong online presence will have to act quickly to transfer their brand, otherwise “opportunistic web entrepreneurs” will get a lead on them and they could see their profits disappear before they have a chance to create them. He mentions that established casinos can guard themselves from a drop in traditional visits by creating their own gaming websites.
Only time will tell if Charalambous is correct in his postulating. But one thing is true: the U.K. could see a drop in profits over time if U.S. companies decide to get in on the action that U.S. legislation has recently allowed them.
