John Pappas, executive director of the Pokers Players Alliance (PPA) gave a strong speech endorsing online gaming spoke to House and Senate Gaming Committees on behalf on HB 392. While he represents Poker players, his speech focused on iGaming, not specifically Poker, and therefore his arguments can be used by lotteries.
I have pulled some highlights out, but I encourage all of you to read the full transcript here.
If you don’t think people in your state are playing online, I encourage you to type this search, “Can I gamble online in Pennsylvania” into Google and see the results. You will be directed to numerous websites that will claim to offer “legal” and “safe” online gaming for people living in Pennsylvania. State regulation of iGaming changes this dynamic and puts Pennsylvania in control of internet gaming by turning it into a state-based industry that is safe for consumers and accountable to regulators.
While some may fear that the advent of internet gaming would destroy or “cannibalize” brick and-mortar offerings, the actual experience shows the opposite. In January, it was reported that Atlantic City had its first gambling revenue increase in 10 years, with the credit going to the success of regulated internet gaming.4 In 2016, revenue from internet gaming grew by more than 32 percent! And the trend continues in 2017. Once again, Atlantic City casinos’ revenues are up. In the month of January an impressive showing by the industry’s online gaming operations (up 28 percent year-over-year) helped to again boost overall casino revenue by nearly 8 percent.
All online betting companies require customers to open an account to make a bet. Let me be clear: to open an account for real-money play, a player does not have to merely prove that he or she is an adult; the would-be player has to prove that he or she is a specific adult whose identity can be verified through existing third-party databases, such as credit reporting agencies. Identity verification and know-your-customer requirements in the regulated online gaming space are as robust as those in the online banking space. The suggestion by some that you can open an account as “John Smith” just because you have John Smith’s credit card information is simply wrong. In all likelihood, you will need to know, for example, the date and amount of John Smith’s last mortgage payment and other similarly granular information. Age verification is an important element of identity verification because, in a regulated environment, failure to do so will result in a revoked license.
Another important matter is ensuring we are appropriately addressing problem gambling. First, it is important to point out that extensive research conducted in recent years – including a key 9 report on American online gamblers last year from the University at Buffalo Research Institute on Addictions – proves that online gaming does not increase the social risks and damage of problem gaming9 . Moreover, comprehensive research on the issue concludes that online gaming operators have more effective and sophisticated tools to prevent and combat problem gaming compared to the measures that are available in brick-and-mortar casinos. Such measures have been adopted in jurisdictions around the world that specifically regulate online gaming and have proved themselves to be highly efficient.
New Jersey again is an excellent example of the effectiveness of geolocation. With major population centers from other states on two borders (Pennsylvania and New York), New Jersey DGE employs some of the most sophisticated technologies to ensure compliance. Using satellite based geo-positioning technology, the DGE verifies the location of internet gamblers across New Jersey on digital maps and computer screens. Geo-positioning is so precise that it can distinguish between gamblers who are on the very edges of New Jersey’s boundaries and those just across the border in another state.