Internet Poker in California is Far from Dead

SB 1485, the California Online Poker Law Enforcement Compliance and Consumer Protection Act, did die in committee this past week and most pundits are reporting its death as a serious blow to Internet poker in California. But, the reality is that though the bill might be dead, it is far from 6 feet under. The

SB 1485, the California Online Poker Law Enforcement Compliance and Consumer Protection Act, did die in committee this past week and most pundits are reporting its death as a serious blow to Internet poker in California. But, the reality is that though the bill might be dead, it is far from 6 feet under.

The 1 hour and 18 minute hearing was called by Governmental Organization Committee Chair Senator Roderick D. Wright (D-25), who desperately wants to make Internet poker a reality in California. However, after seeing the opposing views of tribal gaming, current California land-based cardrooms and others, he decided to pull the bill, for now. Evident in his opening remarks Wright mentioned that, “We still have more work to do”.

The charismatic Wright made several emphatic statements at the outset of the hearing. “The world isn’t standing still while we figure out what to do” and “The longer we wait, the more difficult it will be to get that business back.” He is obviously right. The online poker world continues to chug along.

Overall, I got the feeling from watching the proceedings that this was not a question of if there is going to be Intrastate Internet poker in California, but when it will start. In fact, I am 100% confident that this was not the end of SB 1485, but that this bill is

    the beginning

of online poker in California.

After several Senators got their chance to chime in on the legislation, the panel took comments from the floor. Every single speaker was supportive of the bill except for the Reverend James B. Butler from the California Commission Against the Expansion of Gambling (CCAGE). No shocker there. He was given a large amount of time and even got into a little back and forth with the Chair, who had obviously spent a good deal of time reviewing problem gambling. In response to the Reverend Butler, Wright said, “I can manage the downside of gambling better on the Internet”, than brick and mortar casinos can.

Unfortunately, even though all but one speaker supported the bill, they all had a “but” in their responses. Irish bookmaking giant Paddy Power was again present and emphasized current operators (no shock there). So did the Poker Players Alliance and the Poker Voters of America, who think that players should have a bigger choice than the three licenses that are being proposed.

Senator Wright acknowledged that there may be an issue of liquidity, which has doomed many an Internet poker room. Liquidity refers to the amount of players that are registered and play on a regular basis. He also added that due to the size of the state and the estimated number of gamblers that California is one of only a handful of states (including New York and New Jersey) that would have enough players on their own to host the games. He thinks that in the future the Federal government may allow smaller states’ players to wager across state lines for the sake of liquidity, adding that it “behooves” California to get in “first”.

No one could contest, Wright has done his homework. He even figured out that perhaps it was not in the best interested of California to keep it all within the state, correctly mentioning not all of California lies within the Pacific Time Zone. Therefore, a player signing on at 5AM might not find much of a poker game. He was hinting that in a truly competitive environment California players could be playing against players from England or Russia, if a license was given to an existing global operator.

And ultimately, California may find that that is the solution. How many players are going to suspend play in their existing accounts at Full Tilt or Poker Stars to try the California game? Legislators are shooting for 50% of the existing market. But, these and other current poker giants have zero chance at getting into the game. The legislation will have an article written into it where any operator who has taken bets from U.S. citizens post-UIGEA will NOT be allowed to get a California license. This bill would mark the end of the game for current operators who allow U.S. players.

But, this bill and the political rhetoric make it ‘Game On’ for California. There is no doubt about it, Californians will be getting their Internet Poker. Not in 2010 and maybe not in 2011, but Senator Wright is proving he is a very resourceful and smart guy. Not only has he done his homework, he made SB 1485 an Urgency Bill, so that it may be continually amended. And it certainly will be, until they “get it right” and the citizens of California are playing poker, LEGALLY, on the Internet.

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