Casino Groups Awaiting US LegalizationBy: Fabian Rictor, Thursday April 29th 2010
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Two major casino groups have indicated that they are in full preparedness to move into the American online gaming market once it is legalized. One group is Harrah's, which is the largest land casino group in the world and which has recently added online presence in the United Kingdom. The other group is PartyGaming, which is one of the leading online gambling operators that once operated in the United States but was compelled to withdraw because of the legal situation there.
Gary Loveman, chief executive of Harrah's Entertainment, said in an interview to Reuters that he saw online gambling as the only way to prop up his company's bottom line in the near future. The first quarter losses for 2010 were $195.6 million as compared to losses of $132.7 million for the same period last year. He further opined that he saw no scope for a quick recovery in land gambling operations. Loveman has confirmed that Harrah's has proposals of expanding its land casinos in Asia and its online gambling activities in Italy and France. There are rumors that Harrah's is looking to sell Rio Casino to bolter its cash flow. However all these will amount to a drop in the ocean. In the final analysis Harrah's is banking on the legalization of online gambling in the United States. Therefore Harrah's would be supporting legislation in the pipeline like Congressman Barney Frank's bill. Loveman said that legalization of online gambling would generate billions of dollars in revenue for U.S. operators. Harrah's would stand to get a substantial portion of that given its popularity and the fact that it owns the WSOP tournament and brand.
PartyGaming paved the way for its potential entry to a legalized American online gambling market by completing a multi-million dollar settlement with the US Justice Department in July 2009. Jim Ryan, chief executive officer at Party Gaming, speaking to the Reuters news agency confirmed that his group was in discussion with a few American companies on the possibilities of forming strategic partnerships. The idea was to leverage mutual advantages in exploiting the largest online gambling market in the world. Ryan was quick to add that these discussions were still in the preliminary stages and far from fruition. He refused to name the parties with whom PartyGaming was negotiating. Ryan referred to the legalization of the American online gambling market as PartyGaming's ticket back into the United States. Like Loveman he was bullish about the American legislators' attempts to overturn the UIGEA. He also referred to support from American land casino operators for online gambling and felt that all the pieces of the jigsaw puzzle were finally falling in place.
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