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Missing Out On The Online Casino Gambling Boom
Published: 2005-12-29
 The United States in many ways is losing out on the online gambling boom. Banks, investors, and online casino operators in countries like the United Kingdom are cashing in, while their US counterparts can only sit back and wonder about what could have been...
During my annual office clean out (it's not a pretty sight I tell you), I came across a story that was printed in Time magazine earlier this year. Needless to say, the story leads with the fortunes made by individuals like the directors of Party Gaming. Party Poker currently has over 1 million registered users and the vast majority of them are in the US, which is quite ironic as online gambling is technically speaking still illegal in the US. Party Poker listed on the London Stock Exchange and the rest, as they say, is history. Many others followed with listings by Leisure & Gaming PLC (formerly VIP Management Services) Empire Online and the online casino behemoth, 888 Holdings. Again, the irony continues. These companies make the bulk of their profits from US customers, and in the eyes of the federal government it is illegal.
Analysts (funny enough UK based ones) are forecasting strong growth in the industry, specifically in the next five years where they see the total take from online gambling sky rocketing to $22 billion, regardless of legal difficulties. Some banks and companies like Yahoo and Google have given in to the pressure exerted by the DOJ, by either banning financial transactions or advertising.
Across continental Europe, many state owned gambling corporations are feeling the pinch as their customer flock to offshore betting and gambling sites.
Some estimate that the US is losing out on as much as $7 billion per annum through not legalizing gambling online.
Numerous initiatives are in place to either ban online gambling outright, or to create a legal framew3ork to regulate it, but none as yet have any real momentum.
2006 will be interesting, but the general sentiments seem to be that there will be no significant movement as far as the legal issues in the U are concenred.
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Greece's New Year Gambling Tradition Bolsters Casinos' Earnings
Published: 2005-12-30
 Dec. 30 (Bloomberg) -- New Yorkers will flood Times Square to see the ball drop, Londoners will crowd Trafalgar Square to hear Big Ben chime, and most of Greece's 11 million people will welcome the New Year in their traditional way: gambling.
Constantinos Antonopoulos, chief executive officer of Athens-based bookmaker Intralot SA, said he will gather his family and friends at home on New Year's Eve to play 31, the Greek version of blackjack.
Celebrating the start of 2006 by gambling has more to do with local tradition than his job.
``I grew up playing 31 every New Year's Eve,'' Antonopoulos said in an interview. ``I've done it my whole life, and it's never really about the money.''
Greeks spent 6.2 billion euros ($7.4 billion) on gambling last year, according to Athens-based P&K Research. Per-capita betting in the country is among the highest in Europe. Companies including Opap SA, a betting-shop operator, are poised to expand as countries such as the U.K., Turkey, and Russia allow entry to foreign gaming companies for the first time.
As many as 9,000 revelers visited closely held Club Hotel Loutraki, Europe's largest casino, on each of the past three New Year's Eves, compared with the usual daily average of 2,500 visitors. The casino, 60 miles (100 kilometers) from Athens, says Dec. 31 is the biggest-grossing day of the year.
`Pita Cutting'
``Greeks believe they will have good luck in the new year if they manage to win something during the holiday period,'' Vassilis Neiadas, CEO of Opap, Europe's third-largest publicly traded gaming company, said Dec. 16 in his office in Athens.
The Greek penchant for gambling on Dec. 31 may have its roots in another New Year's tradition: ``pita-cutting.'' During the holidays, families and companies gather to cut a cake and the person who finds a coin in his or her slice is said to enjoy good luck for the year.
The gambling industry in Greece grew 11 percent in 2003 and 18 percent in 2004, according to P&K, and is forecast to grow 10 percent in 2005. On New Year's Eve, gambling has grown more popular as casual gamblers use the kafeneio, or traditional Greek cafes, to bet and play cards with each other.
Last year, Greeks spent an average of 550 euros ($655) each on legal forms of gambling, according to Opap. That compares with about 580 euros per capita in the U.K. and 247 euros in the U.S., GBGC Research estimates. Greece ranked third in the world in 2003 per-capita lottery sales after Spain and Norway, according to La Fleur's world lottery almanac.
Opap's Neiadas is extending opening hours at the company's outlets for two weeks in December, which is usually Opap's biggest sales month. Opap runs the world's largest sports- betting game and has the highest market value of the 56 companies in the Bloomberg World Entertainment Index. Intralot is the largest gaming-services company in Europe.
William Hill, Ladbrokes
Foreign companies are also seeking profits from Greece.
London-based William Hill Plc, the world's second-largest gaming company, last month introduced a Greek-language poker Web site, its first non-English site. William Hill is also forming a venture with Greece's Demco Group.
Hilton Group Plc's Ladbrokes, the world's largest gaming company, is partnering with Intralot in lottery tenders in the U.K. and Turkey. Casinos Austria International owns a stake in Club Hotel Loutraki.
Greece is now the third-largest market for Sporting Exchange Ltd.'s Betfair Web site, based in London. Liverpool, England-based Stanley Leisure Plc, the largest U.K. casino operator, has a pending case against the Greek government to break Opap's monopoly on numerical games and enter the market.
Good Spirits
Greek gaming companies plan to expand abroad as governments deregulate their gambling industries and seek revenue from betting. Hyatt Regency SA, Greece's biggest casino business, opened up Albania's first casino last month. Last week, Club Hotel Loutraki and Casinos Austria won an international contract to introduce Serbia's first casino.
Intralot's international revenue increased from 23.8 percent of the total in 2003 to 75 percent in 2005. The company increased its stake in its Turkish unit from 25 percent to 45 percent in October.
For Antonopoulos, New Year betting isn't as serious.
``At home, it's really just about fun and good spirits,'' he said.
To contact the reporter on this story:
Joyce Gatsoulis in Athens at jgatsoulis@bloomberg.net.
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