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Australia's Prime Minister Wants One-Year Ban on New Internet Gambling Licenses

19 April 2000

Australia's Prime Minister John Howard has asked states and territories to consider a one-year ban on the issue of any new Internet gambling licenses, in response to some fears that new technology could make gambling even more pervasive in Australia than it already is.

The moratorium would give the Federal Government time to explore longer term limits on Australian Internet casinos, including the possibility of complete bans through Internet filters or Web site blocks.

This latter suggestion by Howard has been met with strong resistance by both the Internet and casino industry, as well as some state governments.

While online gambling is at a nascent stage in Australia, as it is globally, there are community fears that the new technology could create even more problem gamblers than already exist.

Australia's legal casino, betting and poker machines industry is such a huge contributor to state revenues that it has been almost impossible to significantly reduce the number of gambling venues, in spite of studies and community concern over problem gambling.

The singling out of Internet casinos, however, is one which the Internet industry and growing online casinos will not be too thrilled about. They would feel that any ban or reduction in gambling operations should be worked out across the entire industry, rather than picking on one delivery medium, i.e. the Internet.

The physical casino industry is a lucrative market backed by large investments by media moguls, industrialists and investment funds. The comparatively tiny amount of gambling going on online is a drop in the ocean.

The Internet Industry Association's Peter Coroneos said the industry group would not support such a proposal and had already sent a letter to Howard stating its position.

"All it will do is drive operators offshore and will therefore undermine the policy intentions which are to provide better protection for players while allowing an activity which is legal offline to grow," he said, speaking with Newsbytes.

This is the same argument used by Lasseters Online, the country's first government-licensed Internet casino. It has made calls for regulation of Internet gambling, to an extent that Australia can take a lead in developing a responsible, regulated online gambling industry that can move early in the international market.

The states are also expected to support regulation, but not bans. Queensland has already rejected a ban on Internet casinos, with Treasurer David Hamill claiming Howard did not understand the technology.

The IIA's Coroneos agrees that trying to ban Internet gambling by applying filters and blocks is unrealistic.

"Filters will empower those users who choose to install them with the ability to limit what their kids can access; but banning anything on the Internet is unrealistic and indicates a lack of appreciation of the nature of the medium," he said. "It also precludes the development of more workable co-regulatory options which industry will support, e.g. licensing sites subject to audits and probity checks."

Hamill said that through regulation, the government could minimize harm and protect players by controlling a licensed local industry.

Also at stake is revenue from overseas that could be assured through development of trusted Australia-based online casinos.

"Up to 80 percent of business on Australian gaming sites is from overseas, so there is an export oppounity that strict regulations which permit online gambling will enhance," claimed Coroneos.

This afternoon, Communications and IT Minister Richard Alston, who introduced Australia's Internet censorship legislation, said he would consider imposing Federal legislation that would over-ride the states and impose a ban or moratorium. State ministers had opposed Howard's plan today in Canberra.

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