Nambling Notes - July 7, 2000

Tidbits from Down Under -- Seven weeks after declaring a moratorium on the issuing of new interactive gaming licenses, the Australian federal government has announced a feasibility study into the consequences of the decision. A Saturday morning story published by ABC News Online reported, "The study will focus on ways in which the year-long ban might be implemented. It will also examine the possible technical, social and economic effects of the moratorium."

According to an article in the Sydney Morning Herald, the proposed moratorium has prompted British bookmakers Sportingbet.com and Flutter.com to reconsider plans to set up operations in Australia. Both operators were reportedly seeking sports wagering licenses from the Tasmanian Government. Flutter.com Director George Monical told the publication, "Australia's moratorium is stifling investment." His company had planned to invest $70 million in coming to Australia.

A separate SMH article projects that Australia could lose up to $2 billion in foreign exchange revenue if the federal government introduces legislation enforcing the ban.

Meanwhile, a group of Australian gaming companies has formed The Australian Gaming Council, an industry body that will lobby the government on gambling issues. Members include Publishing & Broadcasting's Crown Casino, Tabcorp, Aristocrat Leisure and TAB Ltd.

The Singapore Business Times reports that My Casino, an online casino located and licensed in Vanuatu, has become "the world's No. 1 money-spinner in Internet gaming." The company reported A$22 million in May and A$36 million in June. Managing Director Gordon McIntosh attributes much of the company's success to marketing in Southeast Asia.

A Tidbit from the UK -- U.K. betting pools company Zetters has announced a £400,000 fall in yearly pre-tax profits and points to competition from the National Lottery, the rise of online gambling and the continuing image problem of the betting industry as sources of its decline. The company's pre-tax profits for the first quarter of 2000 were £1.1million, down from £1.5million the previous year. Turnover fell from £15.7million to £10.4 million. Chairman, Anthony Wollenberg, who attributes the numbers to the falling popularity of traditional football pools operations, says the group will turn its focus to "lifestyle betting."

A Tidbit from the US -- As you may recall, Nambling Notes reported rumors in March that several Nevada-licensed sportsbooks didn't make the grade when the Gaming Control Board tested their phone wagering systems' abilities to block out-of-state bets. At the time, Board Chairman Steve Ducharme wouldn't confirm nor deny that bets were successfully taken across state lines, but told IGN that no disciplinary action against Nevada sportsbooks regarding telephone wagering was planned. To our knowledge, no Nevada sportsbooks have been nailed, but the Las Vegas Sun has reported that a criminal investigation into the phone betting systems themselves has been opened. According to Keith Copher, chief of the Gaming Board's enforcement division, the Board has found that out-of-state phone bets could be placed illegally, although he also said that no evidence of such betting was found. The Sun reported that enforcement agents were able to make out-of-state wagers on all seven types of Nevada casino phone betting systems.

New Stuff -- Starnet Communications International announced this week that it is complementing its soon-to-be-released Beyond2000 gaming software with a slick e-commerce package that aims to excel in user friendliness. The company's Inphinity Interactive subsidiary has developed EFS2000Enterprise, an online e-commerce solution designed to work seamlessly with Beyond2000 software. The package enables eWallet personal banking, e-commerce payment processing, eFraud screening, financial (billing) reporting and customer service support. It connects seamlessly to Beyond2000, integrating the eWallet concept with the Casino/Game eCashier. The eWallet supports all financial transactions according to North American accounting rules EFS2000Enterprise utilizes two forms of fraud screening: AVS (Address Verification System), the current banking industry standard, and the up and coming ANNS (Artificial Neural Networks) standard. The two-fold fraud protection system aims to provide adaptive, intelligent security for online deposits and withdrawals as well as seamless connectivity to credit card and bank processors, which enables a quick response to existing and new customers as well as customer service support for all activities concerning eWallet personal banking. The new software also incorporates SSL (Secure Socket Layering) and offers export functionality to AccPac (for complete accounting) and management and marketing reports. On the customer side, the solution offers customization and integration of MS Outlook^TM as a management tool with the ability to manage tasks, emails and journals resulting in the automation of many customer service requests. The product was developed using the Unified Methodology (UM) and works on Windows 98, NT and 2000.

Starnet also announced that it has moved to improve the quality of the customer's online experience by setting up a server at an unnamed location in Europe. The server will serve as a Web hosting site and will house non-gaming pages that introduce actual gaming pages. The company stressed that all servers dealing with gaming transactions are still located in Antigua.

Marketing Stuff -- The year 1999 saw bottom-floor pricing for the licensing of online casino software drop so drastically that IGN has been scoping grocery stores to see if turnkey solutions were available via the 25-cent gumball machines by the exits. By the end of the year, you could become a sub-sub-sub-sub-licensee of a major software supplier for about the cost of a cup of coffee. The bottom has fallen out this year, and a company called Casino Ventures has taken the madness as far as it can go. Casino Ventures offers free turnkey casino packages that include both Java and downloadable games, a sportsbook, business support, 24-hour customer support and a unique URL. They'll design the site for you; all you have to do is take over the wheel when it's ready to go live. The software is developed by Starnet.

Makin' Deals -- CryptoLogic Inc. of Toronto announced that its Intertainet Overseas Licensing Limited subsidiary has licensed its online gaming software and support services to an unnamed gaming operation based in Argentina. The company said that the mystery licensee is one of the biggest gaming operators in South America. The name of the operator will be revealed upon the launching of its online casino.

NorAm Gaming & Entertainment Co. announced that it has signed an agreement with NetPro, Ltd. of Florida in which NetPro will provide NorAm with merchant account services on behalf of organizations operating gaming sites under NorAm's license. NorAm CEO George C. Zilba said the deal "gets us one giant step closer to our goal of launching the site before the end of Summer 2000." The company also says that additional areas involving the operation of the website, such as the licensing agreement between NorAm and the charter non-profit operator, the contract for the purchase of the necessary hardware and the securing of a Web host to handle the site's daily traffic, are all under way and progressing very well.

iCrystal Inc., a designer, developer and licensor of Internet games and casino gaming software, has announced a new deal with American Amusements, Inc., a developer of gaming software in Omaha, Neb., in which American has agreed to adapt its software so that iCrystal can license it for Internet use. iCrystal CEO Larry Hrabi is enthusiastic about the deal and said it will "allow iCrystal to license over 100 new Internet games that have a completely different look than our existing game packages." Hrabi expects the deal to give his company "the largest number and variety of Internet games in the world."

New Faces -- Chartwell Technology Inc., a developer of Java-based Internet games, announced this week the appointment of two new senior executives. First, Donald C. Harold has been appointed vice-president of software development. Harold, a senior information technology professional specializing in e-commerce applications, business and product management, will be responsible for all software development at Chartwell. David C. Acorn, meanwhile has been appointed manager of Internet development. Acorn specializes in Web development and will be managing all of the company's graphics and Web strategies.

Go Call Inc. announced that Jean Bissonet has been named director of sports book marketing. Bissonet previously worked for NASA Sports and BMI. His duty will be to create an advertising program to promote Go Cash, Go Call's transaction processing subsidiary.

Starnet announced July 6 the appointment of Winston Brown as chief operating officer. Brown will replace Helmut Biemann, although Biemann will remain with Starnet as a pari-mutuel services development consultant. Brown worked previously for Avnet EM, a distributor of computer products in San Jose, CA, where served as a field sales engineer and a business development manager. He worked also for Digital Dispatch Systems in British Columbia as a director of product development / manufacturing and product manager. At Starnet, Brown will be responsible for customer service, e-commerce and systems administration operations.