Online Gambling News all over the world 2.8.2009

02.08.2009, Online Gambling in Argentina a Contentious Issue, Online Gambling in South Africa Growing Fast, Gigamedia Online Gambling Operations Solid, Online Gambling White List on Hold in U.K., Rank Group Online Gambling Division Still Growing

Online Gambling in Argentina a Contentious Issue
No football, is the worst case scenario in any country that loves the sport. This is especially true when it comes to those who want to put bets down on the outcome of the games. If there is no game there is no wagering how bad can that be? Well in Argentina that scene may become a reality. Boca and the other teams may not start the Argentinean Apertura season on 14 August as planned. The Apertura which is the second half of the 2009 domestic tournament, has been suspended by the Argentinean FA, not just a game or two but the entire league, until a solution to money problems plaguing clubs is found.

The reasoning behind such a move is based on the outstanding fees owed to the club players. After the first half of the football tournament, the Clausura, was over, Agremiados, acting on behalf of the players, demanded the outstanding sums be paid out. The Argentinean Football Association believes it has undersold television rights, and is working on reaching " a convenient and intelligent negotiation" in order to secure extra TV revenue for clubs.

Internet gambling and gambling in general has also become a big issue in Argentina. Gambling laws in Argentina are not federally controlled. Each province has it's own set of rules and regulations, which is becoming a source of tension among those jurisdictions, mostly because with the advent of online wagering territories are becoming harder to regulate. Most of the local websites offering online betting are owned and operated by offshore companies and therefore income from wagering does not remain in the country.

The president of the AFA, Julio Grondona, is using football as a spring board to push his demands for a piece of the gambling pie for the players and clubs. The Argentinean government has acknowledged that "no one wants football to stop". It is likely though that the game will go on as usual but only after Grondona and the gambling legislators provide the people of Argentina with a good show of back and forth as they argue the merits of a new gambling structure.

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Online Gambling in South Africa Growing Fast
South Africa has been experiencing the new world of online gambling in recent months as the activity grows in popularity in the country. Advancements in technology and ingenuity especially among the youth of the Eastern Cape are allowing the everyday individual to access offshore casinos and poker rooms.

Online gambling is still illegal in South Africa although there is no enforcement of the laws currently in place. Regulators are trying to change the laws and make online gambling a legal activity for South Africans. The lawmakers are concerned that the process is taking too long and with that in an unregulated world there are developing problems associated with underage gambling and other related issues.

Executive Director of the National Responsible Gambling Programme (NRGP) in South Africa Professor Peter Collins, said, "In South Africa it is currently estimated that about a quarter of a million people regularly gamble online." he qualified this statement by adding, it was very difficult to calculate how many individuals participated in online gambling. The Professor heads up research on gambling at two university based centres, in South Africa and in the U.K.

Collins pointed out there has been a lot of growth in online gambling in the past few years, with the gambling industry in South Africa being home to as many as six million gamblers bringing in revenues of 20 billion R a year. It is estimated that online gambling makes up 7 percent of the total. Collins said, "It is much easier playing poker, which is a very popular form of internet gambling, online than organising a poker evening in person." adding that, "If you however ban something like this completely it will just drive it underground into the arms of organised crime." Underage gambling, is definitely becoming a problem due to the increase in young people having access to the web through their very sophisticated mobile phones.

The South African government last year legislated a new law that allows operators to provide online gambling provided they adhere to industry regulations. Collins mentioned that online gambling could become a threat to casinos. "If regulated properly, casinos could get a slice of the pie and add to their revenue and services." CEO of the Casino Association of SA (Casa) representing casinos across the country, Derek Auret, commented, Instead of regarding online gambling as a threat for existing casinos, Auret also said he saw it as an opportunity.

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Gigamedia Online Gambling Operations Solid
Gigamedia runs two primary businesses, both focused on online gaming. The first is a Gaming Software & Services, organization that develops and licences software and application services aimed at online casinos and poker primarily for the European market. This portion of the business makes over 70% of the sales. The major licensee is Ultra Internet Media (UIM), which has developed Everest Poker and Everest Casino, two of the more well known online gambling operations in the industry. The other part of Gigamedia's holding company is the Online Gaming and Services division that generates approximately 25 percent of the revenues for Gigamedia. This section is divided into two subsidiaries, first is FunTown, a Taiwan facing operation that offers a wide variety of games with almost 12 million registered users. The other online gaming subsidiary is T2CN, a huge, with over 70 million users, China-based business that focuses mainly on sports games.

Gigamedia previously ran a number of Internet service providers, but left them behind in September 2008, focusing all of it's business on online gambling. Gigamedia has been very productive in recent years with impressive growth and good financial numbers. With Everest Poker striking a lucrative deal with the World Series of Poker, the company is still looking at plenty of opportunities for future expansion. Sales generated showed an annual growth of 38 percent and operating profits at 67 percent since 2004.

Online gaming is really coming on strong in Asia, and Gigamedia is well positioned to capitalize on the trend. FunTown and T2CN continue to perform well. The 13% earnings yield, and a strong business model with plenty of room for expansion Gigamedia is a powerhouse in the stock market. Uncertainty is always something to consider when investing in a company and Gigamedia seems to thrive on just that. It's management is a little unclear about it's future direction with rumours that it will try to focus more on the volatile and competitive Asian market, even as it's online casinos are doing almost 70 percent of it's business. It's a wait and see approach with Gigamedia and to be sure it does have a good track record.

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Online Gambling White List on Hold in U.K.
The United Kingdom's Department of Culture, Media and Sport (DCMS) has announced that it will not be adding any more operators to it's White List until early next year. Current participants in the U.K.'s White List have been informed of the action. The White List consists of those online gambling operators that are approved by the United Kingdom and are allowed to advertise their products and services in media residing in the U.K. The United Kingdom government wants to review the UK Gambling Act. at this time and therefore cannot accept any more applicants. A study being conducted by the Department of Culture, Media and Sport should be completed by the end of 2009 and then be tabled in Parliament by January 2010.

U.K.based bookmakers indicated that offshore operators on the White List enjoyed unfair advantages. This action by the U.K. operators has prompted the review process of the online gambling legislation in the U.K. One of the most open jurisdictions in the world. The operators in the U.K. want to create a level playing field so that there was equal competition in the online gambling industry. The problem is compounded by the fact that many members of the European Union are paying little respect to the European Commission directive to open up online gambling to fair competition from other E.U.nations.

Countries such as Italy and France are not allowing UK-based online gambling operators access to their markets creating friction amoung the countries involved.

The review will also assess the situation of problem gambling. The situation in the U.K. has been growing worse as online gambling operators based in the U.K. are voicing concerns that they cannot compete in the competitive market and are saying they will move to offshore locations where the taxation is less and the restrictions few. It is a profit driven indusrty and the bottom line rules.

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Rank Group Online Gambling Division Still Growing
Rank Group which has been a voice for bingo operators in the U.K against the unfair taxation on Bingo in that nation, announced recently that it's first half year profits were in slight decline. Rank's half year resulting decline in it's online division was at 8 percent. Rank Group's sportsbetting subsidiary Blue Square.com suffered the most with a 43 percent drop in revenues. The large company's online bingo operations did a little better, with Rank's websites increasing revenue by a full 12 percent.

Tax changes announced in the 2009 U.K. parliamentary budget are expected to cost Rank Group as mich as 9 million GBP annually. Internet poker remained slow with revenues declining 15 percent and online casino revenues also dropped 8 percent. Future plans for the online division revealed by the management at Rank Group include the launch of GCasino.com, which will be Rank's premier online casino brand.

Chief executive officer of the Rank group, Ian Burke, said, "Rank performed well during the first half of the year, achieving profitable revenue growth in a difficult economic environment and further strengthening the group's balance sheet through debt reduction. We have set out a clear strategy for growth within the UK gaming market, expanding our portfolio of G Casinos, delivering operational improvements in Mecca Bingo and repositioning Rank Interactive to prioritise its gaming websites and meccabingo.com in particular.

"The first half of the year has been marked by a number of positive changes to gaming regulations, resulting from improved understanding between the bingo industry and the Department for Culture Media and Sport ('DCMS').

"However, the volatile nature of HM Treasury's fiscal policy remains the principal challenge for the group. We are disappointed by the government's decision to introduce a significant increase in the taxation of bingo during this year's budget and will continue to give active support to the Bingo Association in its campaign to achieve a fair deal for Britain's licensed bingo clubs." Burke went on to say,"Despite the economic uncertainty, we are encouraged by the progress we have made this year in terms of enhanced customer propositions, a stronger senior management team and the group's financial position. While we remain cautious in the near-term, we look forward with confidence in the long-term prospects for gaming and the success of the group's growth strategy."

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