Tribes confront Internet gaming’s political, legal complexities
October 3, 2012
tribes recognize the opportunities presented by legalized Internet gaming, but
the combination of high perceived entry costs, legal and regulatory uncertainty
and increasingly contentious government-to-government relations could slow
progress in the next few years.
Those were among the points made at an iGaming Congress session on Monday that focused on Internet gaming and Indian country.
“There’s probably about 270 different tribes operating gaming facilities in this country if I talk to every one of them about Internet gaming, I’ll get 270 different answers,” said Frank Pracukowski, director of administration, Foxwoods Development Company. “Certain tribes want poker only, certain poker and casino games, some believe iGaming will cannibalize their existing facility, they feel they might be too small to compete in the online space, they have to keep an eye on federal and state bills, they don’t have iGaming experience and the cost to enter the market is high. You take all that into account and you get a lot of different answers for iGaming.”
Pracukowski said he has spent the last three years investigating iGaming initiatives and reminded tribal gaming attendees who might be skeptical that Internet gaming is already happening in the United States today, patron demographics at brick-and-mortar casinos are aging, and passing on Internet gaming means losing out on younger customers.
“They don’t even know about your casino,” he said. “You need to prepare for the next generation of gamers.”
Shelia Morago, executive director, Oklahoma Indian Gaming Association, said tribal gaming operators are sold on the need to develop Internet gaming strategies, but the main challenges are political.
“We have a ton of compacts out there and every single state is different,” Morago said. “The real question is not how to do Internet gaming, but what am I going to give up in order to do it, because the ‘give-up’ is going to be in renegotiated compacts. Many of us have been in compact renegotiations in the last five years where every time we’ve done it we’ve lost something. I’m not talking about big things, but it’s an inch-by-inch sort of give-back. A little bit more money on the back end, a little bit more revenue sharing, a little bit more intrusion from the state level on your regulatory structures. And current compact renegotiations now often occur in less friendly environments than five years ago.”
That said, Morago said tribes are now looking at Internet gaming very closely. “Tribes know they are going to have to do something; you can just look at their social media marketing to see how advanced they are,” she said. “It’s coming down the line, we’re getting ready as fast as we can, but everything has to be thought out in detail. To other people, it looks slow, for us it’s deliberate. You have to weigh all the parts and pieces.”
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