Experts and Insiders See Little Hope for Federal Regulation of Online Poker

Those hoping for a federal solution to the question of regulated online poker in the United States are likely to keep waiting for a good deal.

That’s one clear takeaway from the just-concluded 2013 Global Gaming Expo (G2E).

The conference, conducted in Las Vegas, Nevada, brought together industry professionals and analysts from the land-based and online sides of the gambling sector for a week of new product launches and in-depth panels covering nearly every conceivable issue related to the business of betting.

Their consensus: Federal regulation of online gambling – including online poker – appears to be even more unlikely now than it was two years ago. As a result, players should expect online gambling regulation to continue to roll out at the state level in the U.S..

Congressional gridlock cited as biggest impediment

The conversation at G2E regarding federal regulation of online gambling in American inevitably turned time and time again back to the issue of Congressional deadlock.

Geoff Freeman, who recently took over the reigns of casino industry trade group the American Gaming Association (AGA), summed up the frustrating nature of the status quo for those seeking to advance Internet gambling legislation in D.C. during a speech at G2E.

“Anyone who has been to Washington recently,” bemoaned Freeman, “knows that the environment for getting a bill done is not there.”

That theme was repeated at panel after panel and report after report coming from G2E. Getting a bill through Congress would require two potentially unconquerable challenges: first, generating bipartisan support for any legislative initiative is inherently a tall order in the current D.C. climate. Second, online gambling presents a unique roadblock to passage, as the issue is highly controversial in some corners of Congress – especially the Republican-controlled House of Representatives.

States claim all of the iGaming regulation momentum

The good news for Americans holding out hope for a legal online poker option in the near-term: The same group of industry veterans and insiders widely believes that the pace of state-based expansion will accelerate rapidly over the next 18 to 24 months.

California was cited over and over as a state that has finally turned the corner on the issue of regulating Internet gambling, with many at G2E arguing that 2014 would the year the Golden State finally brings regulated poker online.

Less-discussed but still frequently mentioned was the state of Illinois. Chatter at the conference suggested that supporters of online gambling legislation in Illinois had learned valuable lessons from the failure of their first two attempts to pass online betting regulations into law and are preparing for a new, refined effort that ought to have a far greater chance of success.

Reid’s Wire Act “fix” one possible wild card

The one specter hanging over the discussion of federal regulation: The so-called Wire Act “fix” that Senate Majority Leader Harry Reid is said to be mulling as a last-ditch option for advancing some sort of federal regulatory scheme for Internet gambling.

In this scenario, Reid would propose a bill that tightens the Wire Act to prohibit all forms of online gambling. As part of the bill, Reid would carve out exceptions for a select number of Internet wagering activity – including, the thinking goes, online poker and online horse betting.

The logic behind the strategy is the Republicans will rally to a bill that limits the expansion of online gambling, giving Reid the support he needs to push a bill through Congress. But such a bill would also be deeply unpopular with a number of groups, including some of the very casinos that helped Reid to eek out a narrow re-election victory in 2010.

Rumors of the Wire Act “fix” have been floating around since August, but have remained little more than pure speculation, as no concrete details regarding Reid’s bill – or his plan for advancing it through the adversarial mire that is the United States Congress – have emerged since then.