International Game Technology (IGT) does not believe much progress will be made legalizing online poker in congress. IGT’s chief executive said that a recently acquired social gaming company is growing faster than expected. Patti Hart, CEO of the casino games maker, told reporters during an interview.” Politicians have been notoriously reluctant to address the issue during an election year and most gaming experts expect little progress during the current lame duck session of congress.
So far Nevada and Delaware are the only states that have legalized online gambling but several states are considering it after the justice department said that only sports betting online was unlawful. A majority of officials polled by the American Gaming Association envision the US gaming market growing to $10 billion or more over the next few years, up from $4 billion in illegal unauthorized internet gambling in 2011. In January IGT acquired Double Down, one of the largest providers of games on Facebook. The deal could total $500 million including milestone payments.
Currently Double Down offers free online games such as poker, blackjack and slot games. It generates revenue from the sale of virtual chips rather than players betting with real money which is prohibited in the US. Patti Hart stated “(DoubleDown is) way ahead of plan, meaningfully contributing to revenue, EBITDA (earnings before interest, tax, depreciation and amortization), and cash flow in the company.” Double Down’s fourth quarter revenues were $35.8 million a 20% increase from the previous quarter. Hart added “(IGT’s gaming license is) for people who reside in Nevada, so the pool of potential players is not significant enough.”
Proposed federal legislation would legalize internet poker and off track horse betting but would make all other forms of internet gambling illegal. Critics say the bill limits the ability of states to regulate online gambling inside their borders. Hart, who left Yahoo Inc’s board earlier this year amid the fallout from the resignation of the internet company’s CEO Scott Thompson, said “We’ve been slowed down by the legislative process, there’s no question about it. Our reaction was to find a way to extend a gaming experience to the public that is not really encumbered by the legislative process and that’s what we’ve done (with DoubleDown). The online gaming environment looks social for an extended period of time in the United States.”