Internet Gambling

June 16, 2012

The gambling industry is one of the most lucrative forms of entertainment in America today. Revenues from gambling in 1998 were greater than those earned from recorded music, theme parks, video games, spectator sports, and movie tickets combined. There appears to be no end in sight to the popularity of gambling in America, as gaming revenues have grown every year for the past twenty years at a ten percent rate, with 1999 revenues totaling $58.2 billion.
This revenue growth has coincided with the relaxation of state laws forbidding gambling. As early as 1985, casinos were legal only in Nevada and Atlantic City, New Jersey, but today at least twenty-eight states have legalized casino gambling. Additionally, forty states have a state lottery. In all, every state except Hawaii and Utah now has some form of legalized gambling.
While the traditional forms of gambling, brick-andmortar casinos and state-run lotteries, continue to comprise the largest share of industry revenues, a new medium for gambling has emerged with the advent of the Internet: the on-line casino. People with access to a computer are now able to log on at literally anytime and enter the world of the virtual casino. This burgeoning sector of the gambling industry is expected to bring in over three billion dollars in revenue by the year 2002. There are currently more than 250 casinos, 139 sports books, 20 bingo games, and 64 lotteries operating on the Internet. However, the future of these casinos is in doubt as the federal government contemplates whether or not to legalize and regulate them or to ban their operation altogether.
This note will mention the policies both for and against gambling generally, and focus on the policies specific to Internet gambling. It will then examine the state and federal laws that pertain to this field and how the public policies have affected the laws in the past and how they should affect them in the future. Next, it will discuss the jurisdictional issues associated with the implementation of Internet gambling laws, which is of primary importance in regards to the enforcement of antigambling legislation. Finally, some suggestions will be made about the future of Internet gambling regulation, both for and against its legalization.