Online Gambling: Internet gambling is, generally a means of using the internet to place bets on casino games, sports games, etc. Bets are usually placed through credit card accounts and wins or losses are paid or collected accordingly
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Online Gambling
1.
2.
3. Introduction
History
Types of online gambling
Market share and Statistics
Risks and Benefits
Legalities
Youth, Adults and Online Gambling
6 thesis
Providers and Payment Methods
Future of Online Gaming
Pros and Cons
Conclusion
4. What is Gambling?
Gambling is the wagering of money or
something of material value on an event with
an uncertain outcome with the primary intent
of winning additional money and/or material
goods.
Gambling is also a major international
commercial activity, with the legal gambling
market totaling an estimated $535 billion in
2013.
5. Internet gambling is, generally a means of
using the internet to place bets on casino
games, sports games, etc. Bets are usually
placed through credit card accounts and
wins or losses are paid or collected
accordingly.
Online gambling, also known as Internet
gambling and eGambling, is a general term
for gambling using the Internet.
6. • In 1994 the Caribbean nation of Antigua
and Barbuda passed the Free Trade &
Processing act, allowing licenses to be
granted to organizations applying to open
online casinos
• In the late 1990s, online gambling gained
popularity. Internet gambling websites had
increased from just 15 websites in 1996, to
200 websites in 1997
7. The Internet has made way for new types of
gambling to form online. Following are
different types of online gambling games:
1. POKER
2. BINGO
3. LOTTERIES
4. SPORTS BETTING
5. ONLINE CASINOS
6. HORSE RACING BETTING
10. Youth Gambling
Pathological Gambling
familiarity anonymity
high level
of privacy
easy access
24 hours
Criminal Use
1. Lack of Accountability
3. Money Laundry
2. Computer Hacker
Jobs
Investment
Tax revenue
Contribution to society and
economy
PROBLEM: difficult to compare
risks and benefits due to lack
of information
11. •Problem gambling & addiction
•Harm for individual and society
•Minors
•Crime associated with (some) gambling operations
(fraud, money laundering)
•Consumer protection
•Ensuring gambling is conducted fairly and openly
12. • —India has recently become a potential gold mine
for online gambling operators. This is mainly due
to the current financial growth of their middle
classes and the exponential increase in the
number of people in the country who now have
access to the internet.
•According to gambling statistics, 40% of the
indian population that have a computer and
internet, visit online gambling websites.
14. “It is impossible to stop people gambling on the Internet, all you can
do is to make it harder.”
(The Economist 1999)
“The government has as much of a chance of banning internet
gambling as the FAA has of banning migrating ducks flying
through commercial air space.“
(Posting in a gambling newsgroup)
40 countries worldwide which allow gambling
Australia, Austria, Germany, Finland...
Off-shore countries (tax haven)
USA struggles bet regulation and banning
$ 40 billion tax revenue by state-run lottery
But is it possible to stop internet gambling without
a worldwide uniform law?
FAA: Federal Aviation
Administration
15.
16. Betting or gambling is illegal in most of India. But there is
no law that makes online gambling an illegal activity.
Of f shore betting companies are apparently using this
loophole to lure Indians to bet on pretty much every
thing.
According to The Public Gambling Act 1867, all kind of
gambling are illegal in India.
On 4th March 2009 the government of Sikkim issued a
memorandum know as Sikkim Online Gaming Rules 2009,
this outlines the rules and regulations for online gambling
licensing within the state.
18. •Outright prohibition of online Gambling Workable?
•US Unlawful Internet Gambling Enforcement
Act 2006
•State operator monopoly
•Eg Svenska Spel or Norsk Tipping (games);
Norsk Rikstoto (horse race betting)
•Single private operator
•Eg Pari Mutuel Urbain in France
•Restricted licensing system
•Open licensing system
•Eg UK Gambling Act 2005
19. Divergent laws, no harmonisation, no country of
origin rule
Excluded from scope of Services Directive, E-
commerce Directive etc
The internet & cross-border access
EU Treaty, Arts 43 and 49 (freedom to provide
services & establishment)
Direct effect => lever for harmonisation??
Role of the courts in the absence of
harmonisation?
20. •Case C-275/92 Schindler
•Case C-124/97 Lärää
•Case C-67/98 Zenatti
--------------------------------------------------
•Case C-234/01 Gambelli
•Case C-338/04 Placanica (6. March 2007)
•Case E-1/06 Re Amendment to Game & Lottery
Law (14. March 2007)
•Case E-3/06 Ladbrokes v Norway (30. May 2007)
21. •Jurisprudence under Art 234 (Prelim Ref)
•Commission infringement procedure Art 226
•Notification against Denmark, Germany,
Finland, Italy, the Netherlands, Sweden and
Hungary (April 2006)
•Austria and Luxembourg (December 2006)
•Commission expressing concerns on the
German Inter-State Treaty in March 2007
•Internet prohibition for sports bets and
lotteries
22. •The PMU v Zeturf case as an example
•Situation following Gambelli & Placanica:
•PMU v Zeturf : Court of Appeal, Paris: (1) ordering
cessation of operations; (2) quantifying the penalty
amount due by Zeturf
•Maltese courts refuse enforcement
•French Cour de Cassation: Reversed to CA (13. July
2007)
23. - The prevalence of youth online gambling has risen
noticeably in recent years (2003/04: 2 %; 2007/08:
24 %).
- 4 % of the sample participate at least weekly in
Internet gambling (mostly boys).
- Almost all adolescents with online gambling
experience gamble offline simultaneously.
- A relatively large number of Internet gamblers are
problem gamblers (Internet gamblers: 7.7 %; non-
Internet gamblers: 1.1 %)
24. Online Survey (worldwide)
n = 12,521
Internet gambling
(yes)
Internet gambling
(no)
Non-problem
gambling (%)
39.9 82.1
At-risk gambling
(%)
43.4 12.3
Moderate gambling
problems (%)
12.8 4.0
Severe gambling
problems (%)
3.8 1.7
25. The theoretical analysis of structural characteristics of Internet
gambling implies a high addictive potential.
But: Differences between gambling forms are necessary!
Online surveys with self-selected samples suggest that online
gamblers are significantly more often problem gamblers.
But: Generalizations are illegitimate based on self-selected
samples!
First epidemiological studies seem to confirm the high
addictive potential associated with Internet gambling.
But: Small number of cases/ cause and effect is unknown!
26. The longitudinal analysis of actual online gambling behavior
(bwin subscribers) indicates that only a small fraction of the
cohort shows excessive gambling patterns.
But: Analysis is restricted to a single provider of online
gambling!
Economics (time, effort, costs), temporal precision, large
sample, objectivity of acquisition, longitudinal study
Lack of representativeness of sample and
behavior, lack of data validity (missing information on use of
other forms, on gambling motivation, on gambling-related
problems etc.), prediction of behavior on restricted data base
is limited
27. Analysis of gambling behavior (Behavior Tracking Tools)
Comparison with versions that cover characteristics of problem
gamblers
Implicates low threshold measures
Useful, innovative measures of player protection
Integration in corporate culture, no lip service
Politics must demand early detection and control it
28. 1. Growing turnover figures of online gambling are to be expected,
independent of prevailing regulatory frameworks!
2. The enforcement of a total ban of online gambling seems unrealistic
and cost-intensive. Obviously, the prohibitive approach doesn‘t fulfill
the function of averting risk!
3. The impact of smartphones in the acceleration of online gambling
servives will increase!
4. A growing number of persons is going to develop problems related
to online gambling!
5. The Internet confronts addiciton prevention with new challenges. At
the same time, however, it offers promising approaches for player
protection such as early detection of at-risk behavior based on
actual gambling behavior!
6. An independent evaluation of implementations of social concepts
is necessary as gambling providers get a significant proportion of
revenues from gambling addicts (up to 56 %, depending on type of
gambling)!
31. • 48 jurisdictions
• Major providers are:
• Gibraltar (208 sites)
• United Kingdom (98 sites)
• Malta (314 sites)
• Alderney (62 sites)
• Isle of Man (14 sites)
• Netherland Antilles (257 sites)
• Austria (9 sites)
• Costa Rica (218 sites)
• Antigua (76 sites)
32. • 150 ways to pay
• Visa and MasterCard most popular, and
accepted by 90% of sites (not from U.S. players)
• Other popular methods: Neteller (72% of sites);
Bank Wire Transfer (58% of sites); Moneybookers
(50% of sites); personal cheque (25% of sites).
33. $15-20 billion in 2008, with sports/race books,
casinos and poker accounting for large majority
4-5% of worldwide gambling market
Patronage uncertain: North America (30-35%)
Asia (11 – 49%); Europe (23-44%)
U.S., China, U.K. largest single markets within
these continents
34. Unfair, Illegal, or Irresponsible Business Practices
Not paying player winnings
Unfair odds
Free-Play sections with odds that favour the
player
1/3 of online players report having had a dispute
with an online casino or poker website
35. Unfair or Illegal Player Practices
Hacking sites to pay wins
Theft and fraud at skill game sites
‘denial of service’ attacks (extortion)
Money laundering
Player collusion
Poker bots
36.
37. Nature of Internet Gambling makes it conducive to
producing Problem Gambling
24 hrs immediate access
Solitary play
Immersive interface
‘electronic cash’
Ability to play under influence of drugs or alcohol
In general, evidence suggests the prevalence of
problem gambling is 3 to 4 times higher in Internet
gamblers
38. Continued strong revenue growth
Particularly strong growth among the
Asian market
Strong growth in Betting Exchanges and
Skill Games
39. • Market consolidation
• Growth of other forms of remote gambling
• Increasing rates of problem gambling
• Movement toward legalized and regulated
markets (with some later regrets?)
40. • Increasing rates of problem gambling
• Movement toward legalized and regulated
markets (with some later regrets?)
41. REGULATORY CONTROL WOULD ENSURE FAIR GAMES
AND BETTER PLAYER PROTECTION
REGULATORY CONTROL WOULD ACCRUE ECONOMIC
BENEFITS THAT ARE CURRENTLY LEAVING THE JURISDICTION
(THEN APPLIED TO PREVENTION/TREATMENT)
GOVT SHOULD NOT BE REGULATING PEOPLE’S LEISURE
BEHAVIOUR OR HOW THEY SPEND THEIR MONEY
42. Legalization will increase the rates of problem gambling
Nature of online gambling makes it inherently more
problematic
Significant % of online gambling revenue comes from
problem gamblers (41% in canada; 27% internationally)
Legalizing online gambling and redirecting $ into treatment
does not offset the harm caused
43. 2. Trends toward regulation instead of banning
Regulation (mostly through licensing) is the only way to
generate budget to cover the social costs following from
excess gambling
These social costs occur independent from any regulation
1. Internet Gambling will not substitute off-line industry:
Betting will be mostly conducted via Internet
But casinos and lotteries will hold a big market share
Overall growth
3. Social Problems will sharply increase
Youth gambling and pathological gambling due to features
of Internet
44. • ONLINE GAMBLING GROWTH SECTOR => PRESSURE TO
LIBERALISE CROSS-BORDER PROVISION
• POTENTIAL FOR SOCIAL & INDIVIDUAL HARM => RISK
ASSESSMENT SPECIFIC TO ONLINE GAMBLING
• ENFORCEMENT ISSUES PERTAINING TO NATIONAL REGULATION
(ARRESTS; PAYMENT PROVIDERS)
• HARMONISATION UNLIKELY
• ROLE OF THE ECJ/WTO IN DETERMINING THE LIMITS OF SOCIAL
POLICY
• PROPORTIONALITY TEST
• BUT APPLICATION BY THE NATIONAL COURTS?
• RESULT: LITIGATION BATTLE
