US situation could change says Partygaming boss

PartyGaming chief executive Mitch Garber seemed to be in optimistic mood when speaking to the UK newspaper The Guardian as a turbulent week for online gambling ended. The leader of what was until recently the biggest powerhouse in Internet gambling told reporters that he thinks there is a 50 percent chance of the new prohibitionist US legislation being scrapped within three years should the balance of power in Washington drift away from the Republicans.

"That might seem like wishful thinking but we could see a strong backlash from US players ... and there could be changes [of control] in the house and senate," he said. "In the meantime, we are going to keep our US database of [former] players - don't forget, 10 million people have our software downloaded on their computers."

His position was echoed by Sportingbet chief executive Andy McIver, who also believes the US political climate could change in the industry's favour.

However, industry insiders suggested offshore operators such as PartyGaming, Sportingbet and 888 would be unlikely to regain their dominance in the US should anti-online gambling laws be fully unravelled. They would face heavy competition from the likes of Las Vegas operators Harrah's and MGM - businesses which had previously avoided internet betting because of confusion over its legality.

And many US players have been alienated by what many see as the precipitous exit from the market of these offshore operations in response to the American legislative moves to curb financial transactions to internet gambling sites.

PartyGaming, which operates poker and casino websites, immediately closed to US business when the Safe Port Act was signed into law last week. As a result the group lost 70 percent of poker revenues and 65 percent of online casino revenues overnight. 888.com reacted in a similar manner.

Garber conceded PartyGaming had been overtaken as the world's largest poker operator by rival PokerStars, a private company determined to continue serving the millions of US poker players, but somewhat provocatively described the Israeli-owned group as a "black market operator" claims the Guardian.

He played down concern that lower player numbers on PartyGaming's poker site, termed "player liquidity" in the market, were likely to prompt an exodus of non-US players.

PartyGaming remains the largest operator outside the USA, where the number of new players last week reached a record high. Overall non-US revenues, however, declined 2 percent for the week (see earlier InfoPowa reports).