August 2018 update on the status of formally regulated statewide U.S. online poker.

Overview

  • Licensed real money online poker games are currently available in three U.S. states: New Jersey, Nevada and Delaware.
  • Pennsylvania online poker games are expected to launch in 2019.
  • A small number of states are likely to at least consider regulating online poker over the next 12 months.
  • Online poker along with other iGaming formats require statewide licensing due to a lack of federal support for regulation/taxation of online gambling products.

Pennsylvania Online Poker Launch (2019)

Statewide U.S. Online Poker - Gov. Tom Wolf

Pennsylvania Governor Tom Wolf

Here’s what we know so far about licensed Pennsylvania online poker games.

(A) Nine land-based casinos (out of the state’s 13 eligible main slot machine Certificate Holders) have applied for all-encompassing iGaming licenses that — pending August 15th approval* by the Pennsylvania Gaming Control Board (PGCB) — will allow them to offer online poker, slots, and house-edge table games to residents and tourists located within the Keystone State, age 21 and over.

* On Wednesday, August 15th, Chester Downs (Harrah’s Philadelphia — 888/WSOP) became the first land-based Pennsylvania slot machine main Certificate Holder to obtain formal permission to operate real money online poker, slots, and house-edge table games in the Keystone State.

Greenwood Gaming & Entertainment (Parx Casino — GAN) and Mount Airy (PokerStars/888) also received Board approval for their respective Interactive Gaming certificates, while it was announced Wednesday that Presque Isle and Mohegan Sun have since submitted petitions to offer iGaming services. Further information related to Pennsylvania iGaming product testing, regulatory procedures and pending launch will be communicated by PGCB Executive Director Kevin O’Toole in upcoming meetings.

The licenses will cost each of the following operators $10 million: SugarHouse, Rivers, Parx, Hollywood, Valley Forge, Harrah’s, Sands, Mount Airy, and the yet-to-be built Stadium Casino.

(B) Pennsylvania poker players will not be able to play online while physically located within land-based gaming areas. Access to the state’s real money online poker and casino games will be blocked within brick & mortar casinos via geolocation technology, per Pennsylvania gambling laws.

(C) As a result, players will not have the option to sign up for an account on-premise, even if the Pennsylvania land-based poker rooms they patronize offer online services. There is likely to be some confusion over this at launch, because brick & mortar casinos in neighboring New Jersey have infrastructure in place to guide customers through an on-premise signup process that will be prohibited in Pennsylvania.

(D) Branding for online poker sites in Pennsylvania may also result in some initial confusion for players accustomed to familiar portals such as Partypoker, 888 Poker, PokerStars, etc. Pennsylvania gambling regulations will mandate that iGaming sites operate under branding of the main Certificate Holder.

This could result in players being directed to domains such as 888-dot-harrahs-dot-pa, or partypoker-dot-valleyforge-dot-pa, etc.

Here’s what we DO NOT know about licensed Pennsylvania online poker games.

(A) It is not known whether Pennsylvania will eventually link to the tri-state regulated online poker market that includes New Jersey, Nevada, and Delaware. It is widely speculated that such a shared liquidity deal for PA is a logical, foregone conclusion. However, statewide officials must still agree to terms before this can happen.

(B) Player deposit and withdrawal options are not known at this time. This will be the responsibility of each operator to communicate to customers upon launch.

ADDITIONAL RESOURCES: PA REGULATED STATEWIDE U.S. ONLINE POKER

Pennsylvania Online Poker and Casino Partnerships (Online Poker Report)
Pennsylvania Poker Room Revenue for Fiscal Year 2017/2018 (Part Time Poker)

Michigan Online Poker Legislative Proposal

Statewide U.S. Online Poker - Rep. Brandt Iden

Michigan State Rep. Brandt Iden

Michigan House Bill 4926 (also known as the Lawful Internet Gaming Act) would formally authorize approximately two dozen tribal gaming establishments and three Detroit commercial casinos to operate real money online gambling games that “must include, but need not be limited to, poker.”

Introduced and championed by Michigan Regulatory Reform Committee chairman Brandt Iden, the statewide U.S. online poker legislative proposal would allow Michigan residents age 21 and over only to place iGaming wagers in a regulated environment under the authority of the yet-to-be created Michigan Gaming Control Board.

The Great Lakes State is among a small number of front-running jurisdictions that could potentially license online poker games in the near future, given its familiarity with (and successful implementation of) online lottery products — which are governed separately by the Michigan Bureau of State Lottery.

However, concerns over whether gambling stakeholders and lawmakers will be able to iron out an agreement remain, and the statewide constitutionality of expanding into internet gambling is open to interpretation.

Furthermore, some residents are worried online casino games might cannibalize similar offerings by Michigan’s state-sponsored lottery products — which raise proceeds for the Michigan State School Aid Fund.

Illinois Online Poker Hearings

Statewide U.S. online poker

Illinois State Rep. Bob Rita

Longtime Illinois gambling expansion proponent and State Representative Bob Rita recently announced that two hearings will be held this year to discuss online poker, casino, DFS and sports betting.

The hearings will be held on August 22nd and October 3rd in Chicago and Springfield respectively, but there will be no vote on the matter until the November elections have concluded.

Illinois State Congressman Bob Rita to Hold iGaming Hearings (The Chicago Citizen – Aug 8, 2018)

Online Poker Fails to Advance in New York

Statewide U.S. online poker

New York State Assemblyman Gary Pretlow

According to New York Assemblyman Gary Pretlow, online poker was just eight votes shy of passing in 2018. Instead, legislative debate for regulated online poker in NY has been shelved until at least 2019.

Much of the rhetoric surrounding New York online poker legislation deals with whether the game is “skill-based” (and therefore falls outside the traditional definition of “gambling”) or a “game of chance.” New York S 3898 and A 5250 would have provided a special, skill-based carve out for online poker, but would not have authorized online casino and slot games.

The battle for NY online poker will lose a key ally this November when State Senator John Bonacic retires following a two-decade career serving Empire State citizens, and it is unclear at this time whether a renewed legislative push will occur next year.

California Regulated Online Poker Still a Distant Dream

Statewide U.S. online poker

California State Capitol Building

The friction between tribal gaming and commercial cardroom interests in California is at or near an all-time high, and there appears to be no immediate path forward to licensing CA online poker games without significant compromises made by all parties involved.

Even if California were to formally authorize real money online poker games, it is assumed that the state would resist linking-up to a shared liquidity agreement it doesn’t directly control. Before Black Friday 2011, the state of California alone represented over 5% of the total worldwide online poker economy.

Statewide U.S. Online Poker Lobbying Efforts

iDevelopment and Economic Association (iDEA)

There are currently two mainstream lobbyist organizations that specifically promote regulated, real money, statewide U.S. online poker.

(1) iDevelopment and Economic Association (iDEA)

The iDevelopment and Economic Association is directly supported by iGaming stakeholders including Partypoker parent company GVC Holdings, PaddyPower Betfair, The Stars Group, 888, Golden Nugget, and other related gaming companies.

iDEA‘s approach to U.S. internet gaming is a statewide packaged offering that includes online poker, casino and sports betting.

(2) Poker Alliance (formerly the PPA)

The Poker Alliance has gone through a recent leadership change, and is now a subsidiary of media company Poker Central, owned by high stakes poker player Cary Katz.

Mark Brenner is the new head of the Poker Alliance, and has communicated that the lobbyist wing will function as a service organization to players and activists on a statewide level.

It is unclear how successful the PA will be in attracting and/or coordinating “grassroots” online poker efforts, but regardless Brenner’s collaboration offer to activists is a generous one considering the organization no longer solicits funding from players.

POSSIBILITY OF FEDERAL U.S. ONLINE POKER LEGISLATION?

At this time, there is no large-scale, publicly-funded effort to regulate online poker games on a federal level. Some of the reasons behind this include the following:

  • Vehement opposition from several key federal lawmakers
  • Vehement opposition from several key land-based casino stakeholders, such as Sheldon Adelson
  • Lack of consensus among potential operators on how best to proceed
  • Too many potential stakeholders relative to the amount of operators that could survive in a strictly regulated and/or highly taxed federal environment

Statewide U.S. Online Poker Lobbying Challenges

Statewide U.S. online poker

David A. Couch — Attorney at Law (Arkansas)

Unless an individual or company is invited to testify or otherwise collaborate with a statewide legislature, lobbying requires activists to be constituents of the jurisdiction in question in order to enjoy formal “standing” before lawmakers.

So while a Nevada resident may possess legitimate insight on why internet poker should be licensed in other U.S. states such as New York, the Nevada proponent’s view won’t matter in the eyes of New York lawmakers, and vice-versa.

This reality creates a number of cost-related challenges for lobbyist activities, as it places local activists in a position of relative authority over organizations that might otherwise be able to incorporate that local rhetoric into a proprietary, nationwide fold.

For some perspective, a recent Arkansas casino petition drive cost land-based industry proponents $384,000 for signatures alone… and that was just to get the issue on the November ballot, when far more expensive “get out to vote” campaigns will be required.

At this current rate, the sad reality is that the “statewide U.S. online poker dream” for some players may be relegated to becoming a paid canvasser — and charging $4 for handing-in your buddies’ signatures along with enough of their personally-identifying info to satisfy lawmakers’ ballot initiative verification processes.

On top of this, several large, worldwide gambling conglomerates are currently in a Merger & Acquisition phase that some analysts believe is only just now beginning to pick up steam. As a result, the corporate alignment of major U.S. gambling service providers could be in a state of constant flux over the next couple of years.

Because of this, it is difficult to see how poker player activism could have a significant impact on statewide U.S. online poker without some combination of (a) massive grassroots support, and (b) massive amounts of funding.

Absent that, state-sanctioned licensure of online poker games in the U.S. will rely almost exclusively on the whims of stakeholders, lawmakers, and organized interests that perceive legislative proposals as either a benefit or a threat to their own revenue-generation goals.

Gaming companies will lobby for or against online poker at their discretion, but regardless — they are known to possess superior resources and organization when compared to players, fans and grassroots activists.

What Can Players Do to Support Statewide U.S. Online Poker?

Statewide U.S. Online Poker

United States players interested in supporting statewide online poker games should familiarize themselves with the stances of local lawmakers as well as material that is relevant to their specific jurisdiction.

At the time of this article’s publication (August 2018), the Great Lakes State is of particular interest, where a Michigan online poker bill could potentially be approved before the calendar year ends.

Other than that, fans are encouraged to liberally share publicly-available information that may assist fellow poker players in learning more about regulated statewide online poker in the United States.

More Statewide U.S. Online Poker Coverage via Part Time Poker

Michigan Regulated iGaming Study Guide (Feb 6, 2018)
Pennsylvania Casino Self-Exclusion Regulatory Guide (Jun 17, 2018)
Statewide Gambling Expansions and Voter Referendum Mandates (May 3, 2018)

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