Nambling Notes - Jan 19, 2000

Tidbits from the UK - Government officials in the United Kingdom are denying that a decision has been made to restructure the taxation system for U.K. bookmaking operations. Several reports throughout the week indicated that the current 9 percent betting tax would be removed and replaced by a tax on profits only. The new taxation policy was to be implemented on the condition that U.K. bookmakers operating offshore bring their businesses back to Great Britain. Customs & Excise press officer Claire Morgan said this week, however, that no such decision has been made. "No decision regarding taxation has been taken," Morgan said. "The government's position hasn't changed since the pre-budget statement. A decision will be announced by the chancellor as part of the Budget in March."

The BBC reports that changes are in store for the U.K. National Lottery's licensing process. Culture Secretary Chris Smith says there will be a review of the system, following last fall's debacle in which Camelot, the current operator, was eliminated from the bidding only to be reinstated as a candidate and eventually chosen as the winner of the next seven-year contract. Changes to existing legislation have not been ruled out. Lord Terry Burns, the chairman of the National Lottery Commission, this week told MPs that he's in favor of overhauling the two acts which control the lottery. Modified laws may even enable several companies to run competing lottery draws and scratch-card games. Burns recommended to Smith that legislators consider change existing laws to enable companies bidding against the main lottery operator to offer instant scratch-cards and Internet or mobile phone-based lottery games in the U.K.

This is London reports that Stuart Wheeler, the chief of the spread betting company IG Index, has donated £1 million to William Hague of the British Tory party, with £4 million to follow. Wheeler says there are no political strings attached. The gift will cover a third of the Tories campaign spending, expected to be set at around £15 million.

Tidbits from the US -- Sen. Jon Kyl of Arizona and Rep. Bob Goodlatte of Virginia both indicated this week that they intend to reintroduce bills that would ban the offering of Internet gambling services to persons within U.S. borders. Kyl said this week that he will first concentrate on the Senate's consideration of former Sen. John Ashcroft's nomination for attorney general, but he indicated that reintroducing the prohibition bill is in his plans. Meanwhile, Goodlatte has confirmed that he will re-introduce the House version of the bill as well. "We're going to do it again, but there is nothing definite yet," he told Newsbytes. ". . . I'm sure it will be different than how we originally introduced it."

Based on advice from the New Jersey's attorney general, the New Jersey Racing Commission recently warned Internet gambling sites that taking horse racing bets from New Jersey is illegal. The AP reported Wednesday that the commission will follow up the warning with a similar warning to telephone betting services. "It doesn't matter if it's a New Jersey race or a race from Japan," Executive Director Frank Zanzuccki said. "The New Jersey state Constitution only permits pari-mutuel wagering to occur at the five permitted race tracks and the permitted casinos." Last year the state's legislature passed a bill that would have made both types of wagering legal, but the measure was vetoed by the Governor.

According to the Blood-Horse, account wagering in New Jersey may have a happier fate in the months ahead. Last year's failure occurred after track management and thoroughbred horsemen could not agree on splits and racing dates, but progress involving compromise on those issues has been made and the Blood-Horse quotes Barbara DeMarco-Reiche, a lobbyist for the thoroughbred horsemen, as saying that both sides had bent from their original positions, in which horsemen wanted 170 days of live thoroughbred racing and the tracks 120.

A vocational school board member in Vermont, reprimanded for gambling on the Internet using his credit card, says he will not appeal the board's decision to dismiss him. Kevin Christie, the director of the board of the Randolph Area Vocational Center (RAVC), has been put on probation and will be fired at the end of the school year. In February 2000, Christie lost $1,100 gambling online using the vocational center's credit card. The Associated Press reports that Christie claims to have never gambled online before this instance and that he had used his RAVC credit card by accident. He also wrote the RAVC a check to compensate for the money he'd lost. The center's superintendent discovered in May, however, that Christie had charged auto parts and accessories for his personal use to and RAVC account for more than $400 over a period of four years without attempting to reimburse the school.

New Stuff - A local Hawaiian bingo game broadcast via television is about to go national. The half-hour show, "Bingo Television," will be syndicated and broadcast throughout the U.S. in its new format starting in the Fall of 2001. The hosted show will feed live four times a day Monday-Friday; each affiliate will pick up one of four feeds. Viewers will play from home by matching the numbers drawn during the live game show with numbers appearing on their bingo cards. Cards will be obtained via the Internet, local retailers and a variety of other venues. Viewers who have won, will call a toll-free number to claim bingo.

eLottery, Inc., a subsidiary of eLOT, Inc., and MDI Entertainment, Inc. announced this week the launch of an Internet-based promotion for the Hoosier Lottery linked directly to MDI's newest whimsical brand, SPAM(R). eLottery's IMARCS (Internet Marketing, Analysis, Research and Communications System) technology will enable lottery players to submit non-winning SPAM(R) scratch tickets for a second chance drawing on the Hoosier Lottery's website located at www.hoosierlottery.com.

Makin' Deals -- Gaming software developer Starnet Communications International Inc. has announced the signing of two new licensees. The company will license its proprietary Beyond2000 Internet gaming software to Casino Networks Ltd., an Internet marketing group with over five years experience in the Internet entertainment field. Starnet will provide Casino Networks with a full Internet casino, sportsbook and pari-mutuel interface. Casino Networks possesses several key gaming-related domain names, including www.casino.net, www.toplottery.com, and www.pokergames.com, which the company intends to develop and leverage to maximize exposure for its gaming operations. Starnet will also license its pari-mutuel wagering interface to Bet Racer Network, Inc., a company focusing solely on racing-related activities.

e-Success, a leading real-time auditing and fraud detection company, has announced that it has signed a contract to upgrade the Montana State Lottery with its latest version of Integrity, a real-time transaction auditing product. "The Montana State Lottery has been using e-Success Integrity for two years," stated Michael Meeks, president of e-Success. "While the first version of Integrity was well received, we have continued to evolve and enhance its auditing capabilities. I am pleased that Montana has elected to install the new system and to take advantage of its additional functionality and ease of use."

Indiqu, Inc., a mobile entertainment network that provides WAP-enabling technology for lottery and/or gaming sites, has joined forces with TELUS Mobility to bring interactive games to Indiqu's digital wireless subscribers across Canada. The agreement calls for Indiqu to deliver a wide range of games including casino, card, arcade, sports, quiz show, board and parlor games in both English and French. Launched initially on TELUS Mobility's Clearnet PCS and Mike product lines in 2000, Indiqu's expanded GAME ON channel is now available to all TELUS Mobility customers across Canada.

Poker.com, Inc. announced this week that its Casino Marketing S.A. subsidiary has sold its 15th online casino license. The company additionally announced that the newly updated Starnet Systems casino software has been uploaded to Poker.com's newest casino licensee, Replay Casino (www.replaycasino.com).

Simon Bold (Gibraltar) Ltd. is said to be seeking a buyer for its Gibraltar bookmakers and hoping to find one willing to fork over £30 million. In the last nine months, according to the Telegraph, the Internet and telephone bookmaking firm turned over £6 million, although it is believed to have made a trading loss.

dot com Entertainment Group, Inc. has entered into a license agreement with Madd Maxx Gaming Enterprises Ltd. of Nicaragua in which dot com will deliver and install a complete Internet bingo and Internet casino system for Madd Maxx. The new sited featuring dot com's software is scheduled to launch Feb. 1.

Names and Faces Changing Places - Virtgame.com Corp. this week announced the appointing of Frank Catania to the company's newly formed board of advisors. Catania, a former director of the New Jersey Division of Gaming Enforcement, will be advising Virtgame's management, Joseph Paravia and Bruce Merati, on strategic business matters.

CyberView Technology Ltd., a provider of products and software solutions for online lottery, interactive TV, transactional Internet multi-media kiosks and online proprietary gaming systems, has announced the appointing of Zaya S. Younan as chief executive officer. Younan, 38, has 17 years of high-tech experience and turnaround management, most recently as president and CEO of Pronounced Technologies, a voice interactive software development company.

Bingo.com, Inc., an entertainment site and game application service provider, has announced plans to change its name as part of its revised focus to build and acquire a number of websites, products and services that will appeal to its established yet expanding clientele. As previously announced, a first step in this plan is the proposed merger with Lottery.com (The Lottery Channel). The new company, to be named during the first quarter of 2001, will be made up of Bingo.com, Lottery.com, DollarBill.com, WaveGames.com, GameLand.com and all products, services and websites developed or acquired in the future that appeal to the company's consistent and established group of demographics. "Our anticipated merger with Lottery.com is the first step in our revised plan to become a brand management company," Bingo.com Chairman and CEO Shane Murphy said. "This merger gives us additional opportunities for cross marketing and co-branding of our current websites, a chance to participate in Lottery.com's proposed expansion into online lottery ticket sales, and greatly enhance the company's cash position following the closing of the deal.'