Paul's Blog
Op-Ed Commentary on Today's News, Paul Jason, CEO, Public Gaming Research Institute (PGRI)
When it comes to enforcing laws against internet-based/online criminality, the government-gaming industry has an perplexing optics and messaging problem. That is revealed in two of today's stories. In Switzerland, there will be a nation-wide vote on whether the government should be allowed to block consumer access to the website IP addresses of online gambling operators which do not have a license to operate in Switzerland. These operators may be licensed and therefore legal in Malta or Gibraltar, but it is illegal for them to operate in Switzerland. In another story, the EGBA (European Gaming and Betting Association) is protesting the actions of Norway to block payments and transactions relating to illegal online gambling in Norway. Advocates for deregulating the online gambling markets, like the EGBA, are framing the issue as one of Internet censorship, personal information and data privacy, consumer freedom and choice. Do we want the government telling us which websites we are permitted to access or which online gambling operators we should be allowed to patronize? Do we want the government to prohibit merchant banks from processing transactions relating to online gambling, thereby obstructing the ability of consumers to gamble on the websites of their choice? The voting consumer may well vote NO to either of those questions, right?
I would respectfully submit that if the voting public understood the true nature of the policy decision, the outcome would be favorable for preserving stability and legality in the online gambling world. The questions posed to voters just needs to be framed in ways that more accurately reflect the nature of the voting decision. For instance: Do you think the government should enforce laws against online gambling operators which are illegally stealing money from the charitable causes and the voters of Switzerland/Norway?
The U.S. has a law called Unlawful Internet Gambling Enforcement Act (UIGEA). It requires merchant banks which process credit card transactions to block the transactions of illegal internet gambling operators. It is not a difficult action to implement and it works quite well, effectively making it extremely difficult for the online gambling operators to conduct business. We know there is a large underground sports-betting market in the U.S. But online poker, and secondary operators and even the major online sports-betting operators, have all been effectively prevented from operating in the U.S. And when you read the story about the EGBA protest of the application of a similar UIGEA-style mechanism in Norway, it is clear that the EGBA and their members don’t like it because it works. But their story-angle is one that focuses on freedom of the internet, and privacy of data and personal information. That is a much more compelling narrative than the reality which is these online gambling operators are operating illegally for the purpose of stealing profits/money that supports good causes and the citizens of the consumption country.
See story headlined 12 retail execs share their goals for 2018. Quick, easy read with some interesting take-aways. One concept that seeps through is that we should not over-react to what appear to be important trends, like online merchants opening land-based stores. Everyone stays within their core-competency. Online retailers will never have a large share of revenues derive from brick-and-mortar. Likewise, Walmart consumer connection will always be fundamentally land-based. Another interesting idea: The conundrum to forging consumer connections is that we consumers think we want new and different, and we do. But we also crave familiarity. The trick of it is to find ways to bake these seemingly contradictory elements into the product and message.