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Mark Balestra

Nambling Notes - Dec 22, 2000

22 December 2000

A Tidbit from Oz -- The Australian federal government's 12-month moratorium on Internet gaming expansion officially commenced today. In a nutshell, no new casino-style games or bets in the running will be allowed until the moratorium ends in May 2001. At this time the government will decide whether to ban or regulated Internet gaming. The government is currently finalizing a study on the feasibility and consequences of a ban.

Tidbits from the US -- One of the biggest issues to keep an eye on as we enter the new year is the possibility of new legislation in Nevada that would legalize Internet gambling. Nevada Gaming Commission Chairman Brian Sandoval is on the record as saying that online casino gambling based in Nevada could not exist under current legislation. One would assume that legislation that explicitly legalizes Net betting, such as the bill being prepared by Assemblywoman Merle Berman, would change this, however, Gaming Control Board Chairman Steve DuCharme, advises otherwise. DuCharme, who will step down from his position in January, says that even if such law is enacted, federal legislation already in place would still make Net betting illegal. The specific law to which he refers is the Section 1084 of the U.S. penal code (the Interstate Wire Act), which prohibits the accepting of sports wagers via wire communication facilities over state or international borders. "I don't think the gaming commission would want to adopt something that interferes with the Wire Act," DuCharme explained in a Las Vegas Review Journal article. Internet gambling attorney Tony Cabot disagrees. "The way it's written, it clearly does not apply to Internet casinos," he said. "And if that's the case, where you accept bets from would be the issue of legality. It would have to be intrastate and from foreign markets."

IGN reported Wednesday that Congress, as part of an appropriations bill, has amended the Interstate Horseracing Act of 1978 to include provisions for interactive media. President Clinton signed the bill yesterday and made the following statement regarding the racing amendment:

Finally, section 629 of the Act amends the Interstate Horseracing Act of 1978 to include within the definition of the term 'interstate off-track wager,' pari-mutuel wagers on horse races that are placed or transmitted from individuals in one State via the telephone or other electronic media and accepted by an off-track betting system in the same or another State. The Department of Justice, however, does not view this provision as codifying the legality of common pool wagering and interstate account wagering even where such wagering is legal in the various States involved for horseracing, nor does the Department view the provision as repealing or amending existing criminal statutes that may be applicable to such activity, in particular, sections 1084, 1952, and 1955 of Title 18, United States Code.

The mystery of who will be the United States' next Attorney General ended today with President-elect George W. Bush selecting Missouri Senator John Ashcroft to succeed Janet Reno. What does this mean to the interactive gambling industry? A source in Washington told IGN that overall, the appointment bodes well for Net betting. Ashcroft, according the source, can be expected to take a hands-off approach toward legislation that puts enforcement in the hands of ISPs. Because of the aforementioned Interstate Wire Act, however, he could be tough on Internet sportsbooks. Ashcroft will not be leaving an open seat in the Senate, as he lost in the November election to Missouri's deceased Governor, Mel Carnahan.

Sentencing for Island Sports' Allan Ross, originally scheduled for Dec. 15, has been set to reconvene January 9. Ross, one of 21 Internet bookmakers on the receiving end of criminal complaints filed in 1998 by U.S. Attorney Mary Jo White, pled guilty earlier this year to felony charges.

Makin' Deals -- the online version of Swedish newspaper Aftonbladet, has become the first agent for Sweden's national lottery on the Internet. The new service, launched Dec. 11, is a joint project between Aftonbladet Nya Medier and Svenska Spel, the national lottery.

In the realm of play-for-free gaming,, Inc.and The Lottery Channel Inc. (LCI) have entered into a letter of intent proposing the acquisition by of LCI. LCI is a privately held company (in which NBC owns a minority interest) that currently operates (a lottery information and entertainment site), (a Shockwave game developer and entertainment site), (a customer retention game developer) and (a contest/sweepstakes site). The proposed transaction structure will see LCI merged into a, Inc. subsidiary. As the deal stands now, LCI would be issued approximately 14.5 million shares of common stock of so that it would own approximately 58 percent of's outstanding shares calculated on a post-closing basis. In addition, the shareholders of LCI would receive warrants entitling them to purchase up to an additional 14.5 million shares of common stock of at $2.00 per share.

According to an article in the Cincinnati Enquirer, one of the goals for and LCI is to sell lottery tickets over the Internet. Plans for doing so will depend on the legalization of Internet lotteries in the U.S., but isn't banking on this happening. "If it happens, it would be a life-changing event, President and Chief Executive Shane Murphy said, "but we're not managing the company as if it will happen."

PlayandWin Inc., the developer of an Internet bingo game based on the results of horse races, and TrackPower Inc., the operator of Internet and satellite horse racing services, announced today the signing of a letter of intent calling for TrackPower to sell certain assets to PlayandWin. The assets include, but are not limited to, the information kiosk business plan and related contracts, Inetcable Inc. contracts and broadcasts strategy shares. The deal will cost PlayandWin 20 million common shares and 5 million warrants excisable between $1 and $3. The agreement enables PlayandWin to capitalize on TrackPower's distribution strategy and utilize the kiosk rollout to market, promote and educated racing fans on PlayandWin's new Racingo wager.

TAB Ltd announced this week that it has entered into a heads of agreement with the New South Wales Labor Council to acquire the broadcasting assets of 2KY Racing Radio, NSW's racing broadcaster, for $25.3 million.

New Stuff -- iCrystal, Inc., a designer, developer and licensor of Internet-based casino gaming and lottery software, this week announced the release of its high-performance, security enhancing, business management utility, Crystal Access. The application is client-base monitoring software application designed to retain and absorb the growth of developed lotteries and casinos. Essentially, the system is a Web-based marketing/business management software application that enables iCrystal's licensees to record and monitor the detailed information of their players from anywhere in the world where the Internet can be accessed. With just a few clicks of the mouse, the management can readily monitor all encompassing specific gaming events that transpire over the course of any specified time zone translated in 14 different languages. In addition, a recorded and detailed key data provider enables deposits and withdrawal information to be tracked instantaneously by the most accurate gaming solution available. With the new software, management can scan and evaluate its clients progress with complete account summary and game history retrieval for the latest in internal marketing protocol. Crystal Access has been implemented into all existing software and will be launched with all future iCrystal-developed casino and lottery websites.

The company additionally announced that its ICrystal Software subsidiary has developed and implemented a smart download. The technology will enable players to quickly download the company's software platform and then customize casinos to feature only the games they want to play. It will also enhance licensees' capabilities of modifying, updating and introducing new games to their casinos.

Tidbits from the UK -- Now that Camelot has been awarded operational rights to the U.K.'s National Lottery for another seven years, the group can start plugging all the new and exciting games and prizes in store. Upon winning the contact, the group announced that it would invest £1 billion in the game, and as reported by IGN Thursday, it will take advantage of new means of distribution, including via the Internet and mobile phones. Prizes will include a trip to the moon and tens of millions of pounds. Further, new scratch games will be introduced with £100,000 prizes jumping to £1 million and £1 million and £2 prizes jumping to £10 and £20. They're also considering a Europe-wide game based on America's successful Powerball lottery.

Meanwhile, Richard Branson, whose The People's Lottery consortium put up the losing bid, will consider over the holidays whether he will challenge the Commission's decision to select Camelot despite his fulfilling of the Commission's criteria for winning the contract. Specifically, Branson might protest the decision because his group promised to raise £2 billion more pounds for charitable causes than Camelot promised. "The whole thing's been sad and unfortunate," said Branson. "The process has been worse than the American election."

A Tidbit from the Far East -- As reported by, Hong Kong Jockey Club chairman Alan Li, while speaking recently before an international audience at a gala banquet, warned that poorly regulated offshore Internet betting sites will hurt the racing industry. The solution, says Li, is the implementation of an international betting levy. "We have two major international problems as I see it," Li explained. "One is offshore gambling operators, legal and illegal, and the other the Internet. That is a great problem because there is no international regulation, no boundaries. . . . If you have a regular or one uniform betting duty then all the racing authorities can join together and create one big website with simulcasting--obviously--and everybody can enjoy the bets into that pool. They can be shared. But they must offer a uniform rate of betting levy to the governments otherwise it just cannot happen." The Hong Kong Legislative Council is currently considering a proposed amendment to the Hong Kong Gambling Ordinance that would make both bookmaking and betting with a bookmaker a criminal offense, even when such activity occurs through an offshore site.

From the Department of Corrections. . . -- Last week we reported the World Sports Exchange President Jay Cohen would appear Sunday on CBS's 60 Minutes. If you tuned in, you might have noticed he didn't appear. That's because he will actually appear on the program in early January. We'll report on the specific date as soon as its available to us.

Nambling Notes - Dec 22, 2000 is republished from
Mark Balestra
Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.
Mark Balestra
Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.