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Three more get online poker nod as Nevada ponders intrastate, international future

TAGs: Boyd Gaming, Fertitta Interactive, Golden Nugget, Nevada, Nevada Gaming Commission

boyd-fertitta-golden-nugget-nevadaThree more companies were granted Nevada online poker licenses by the state Gaming Commission on Thursday. Boyd Gaming’s online offshoot Boyd Interactive were first to get their wings, and exec VP Bob Boughner told the commissioners he doesn’t expect online poker will harm business at the 872 poker tables currently in action at Nevada’s brick-and-mortar casinos, in part because grinders can’t play dozens of real-world tables simultaneously. (Not unless they’re secretly The Flash, anyway.) Vegas Inc. quoted Boughner saying this factor alone was “a significant reason this market will grow.”

Late last year, Boyd entered into a three-way online poker joint venture with MGM Resorts and Bwin.party Digital Entertainment. The latter two have applied in Nevada – MGM as an operator and Bwin.party as a service provider – but neither company’s application has yet to be considered by regulators. During his Q&A with the commissioners, Boughner described Bwin.party as the “second largest poker network in the world,” which might even be true, at least until Nov. 6, when Full Tilt Poker relaunches outside the US.

Next to earn their stripes was Fertitta Interactive, the online division of Fertitta Entertainment, which also runs Nevada brick-and-mortar biz Station Casinos as well as the Ultimate Fighting Championship mixed martial arts league. Earlier this year, Fertitta launched its free-play Ultimate Gaming site powered by CyberArts, the software outfit Fertitta acquired a year ago. Finally, the venerable Golden Nugget, which is run by yet another member of the Fertitta clan, also got the Nevada nod. The Golden Nugget has been running a Bally Technologies-powered free-play site since June.

NEVADA PONDERS AN INTRASTATE AND INTERNATIONAL FUTURE
During his grilling by the commission, Boyd’s Boughner mentioned that his company wasn’t averse to the notion of offering products other than poker online, assuming regulators gave them the go-ahead. This stance is understandable, given that online poker can be far less lucrative than online casino games or sports betting. But it’s also somewhat contradictory, as most of the big Nevada operators have been highly vocal in their support of a federally regulated online gaming regime, and the federal online gaming bill that Senate majority leader Harry Reid (D-NV) is expected to introduce during the lame duck session of Congress would make any form of online gambling other than poker or horseracing explicitly illegal.

If anything, Boughner’s comments reflect the current wisdom that Reid’s bill isn’t likely to pass this year – if ever. Apart from the bill’s co-author, Sen. Jon Kyl (R-AZ), Republican support has been slow in coming (or non-existent). Politico published an article this week describing Reid as the GOP’s “top boogeyman” in this year’s Senate races. Even Democratic senate candidates are loath to be seen as too chummy with Reid, and there are rumblings that the Dems may choose another senator to lead them through the 113th Congress. Even if you dismiss concerns over ‘morality,’ everyone on the GOP side of the aisle is fully aware that the bill is supposed to be Reid’s payoff to the casino firms in his home state, which gives Republicans even less incentive to embrace bipartisanship.

So Nevada’s fallback position – opting for intrastate play rather than serving as the hub of a nationwide system – now appears more or less inevitable. But Nevada’s 2.7m residents are far too small a pool for all the state’s online poker licensees to earn enough to break even, let alone turn a profit. Nevada may well look to enter into compacts with other states for online poker, but with all due respect to Delaware, it will be some time before there’s a critical mass of states that have passed the necessary legislation.

So where else will Nevada find the bums to fill its virtual online poker seats? It’s worth noting that unlike Reid’s bill, which puts a blanket prohibition on licensees interacting beyond US borders, Nevada’s interactive gaming regulations only prohibits licensees from accepting players from “a state or foreign jurisdiction in which interactive gaming is illegal.” [Emphasis added.] Translation: the inscription on the Statue of Liberty has been changed to read: “Give me your tired, your poor, your international liquidity yearning to bust some Yankee fish.” But would Nevada allow its residents to access international online poker companies operating legally in other jurisdictions? If not, there better be room on Lady Liberty’s banner for one more phrase: “But keep all your hypocrites, because we’re already lousy with them.”

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