In recent years we have seen a movement among national governments to liberalize gambling laws in order to accommodate online gambling.
It is a movement that is hard to ignore when countries like Sweden and the Netherlands agree to voluntarily break up their state-run monopolies to not only promote online gambling but to also invite international operators to participate.
So what is going on? Why the sudden interest in online gambling by so many governments that were previously cold to the idea? There is no single answer to that question. However, it helps to look at the issue from three different points of view: the gambler, the operator, and the government.
1. The gambler's point of view
There is a lot to love about online gambling from the gambler's point of view. At the top of the list is convenience. If there is one thing that we have all gleaned from the development of the internet, it is the convenience of being able to do so many things online; things we used to do in-person. Gambling is but the tip of the iceberg.
Remember that before the internet, gambling was confined to visiting a brick-and-mortar casino where you would find a variety of table games and slot machines. If you lived in an area that had no casino, you had to travel or play underground games being conducted in a back room somewhere. It wasn't very convenient at all.
Online gambling changes the game completely. Now gamblers can gamble virtually anywhere in the world as long as they have an internet connection available. They can gamble 24 hours a day, seven days a week, every day of the year. To say online gambling is convenient is like saying the sky is blue.
Here are several more reasons online gambling appeals to gamblers:
From the point of view of the gambler, online casinos offer everything they could find in a brick-and-mortar establishment plus quite a bit more. Tying the whole thing together is the unmistakable reality of being able to bet on your favorite games from the privacy of your own home or office. Online gambling is efficient, convenient, and user-friendly.
2. The operator's point of view
Next up is the gambling operator. Today's operators have multiple choices. They can opt to open a brick-and-mortar establishment in the classic tradition; they can opt for a fully online operation featuring video slots, table games, and live dealer games hosted remotely by providers; they can open a hybrid establishment that combines the best of both worlds.
So what is the appeal of online gambling to the operator? It starts with operational convenience. Just like it is more convenient for gamblers to bet online, it's more convenient for operators to open online casinos.
Opening and running a brick-and-mortar establishment requires a lot of work. You have to secure a building, outfit it with game tables and slot machines, hire and train staff, and then maintain everything in tip-top shape. Not so with an online operation.
Online operators build a website and license games from those developers they choose to do business with. From there it is a matter of maintaining their sites. Maintaining a website is a lot easier than maintaining a brick-and-mortar property. Moreover, operators can maintain their sites from anywhere. All they need is a laptop computer and an internet connection.
Within this broad area of operational convenience there are a number of other factors:
Another thing to consider about an online operation is the investment required. Opening an online casino isn't necessarily cheap, but it's certainly not as expensive as opening a brick-and-mortar establishment. The total financial investment is substantially lower for the online operator, inviting more players to get in on the action.
In a nutshell, it is more cost-effective and convenient to choose an online operation over a brick-and-mortar casino. Online gambling is essentially a turnkey business for operators with the financial resources to develop websites and purchase licenses.
3. The government perspective
Last but not least is the government perspective. This perspective is a bit more complex given what we know about governments, regulations, and politics. However, we cannot avoid it. The fate of online gambling ultimately rests in whether national governments allow it to continue.
The first thing you must look at from the government perspective is control. If we know anything about politics, it is the fact that politicians absolutely love to be in control. The desire for control has been the impetus behind many state-run monopolies.
Liberalizing a nation's gambling laws to invite online operators from overseas certainly does not enhance government control. This suggests a lack of appeal. However, we have seen otherwise. The things that do appeal to governments carry more weight than the risk of losing control.
Follow the money
So what appeals to governments and regulators? In a word, money. There is little doubt that tax revenues from gambling generate tens of millions of dollars - or pounds, euros, etc. - for national governments. That is a lot of money government officials have to spend on their pet projects.
Here's the thing about online gambling that governments are starting to come to terms with: people are going to do it whether it is legal in a particular jurisdiction or not. As regulators see it, they are not going to keep the lid on online gambling by continuing to maintain tight control through state-run monopolies. So if they want to reap the tax benefits of all that online activity, they have to liberalize their laws and promote online gambling.
In places where online gambling remains illegal, it is nearly impossible to derive any tax benefits from it. Online operators will simply not report their activities or their revenues for fear of being prosecuted. So that tax revenue goes out the window. The solution is to legalize online gambling, promote it heavily, and then tax operator revenues.
Online gambling appeals to governments for other reasons, too. For example, the economic benefits of online gambling are good for a nation's economy. Let us say you have a country where operator profits are taxed at a rate of 15%. That means operators are keeping 85% of their revenues. That is money being used to hire and pay employees, invest in new opportunities, and so forth. And all those workers are spending their paychecks on food, clothing, entertainment, etc.
When online gambling operations create jobs, they also create the need for tertiary services. The companies that provide those services enjoy an increase in their own business. This creates a chain reaction all the way down the line. In short, online gambling has a positive impact on local and national economies, an impact that cannot be ignored.
Finally, online gambling appeals to governments because it increases revenues without contributing to some of the problems associated with brick-and-mortar gambling establishments. Where communities with brick-and-mortar casinos tend to see an up-tick in things like prostitution and petty theft, that is not a concern with online operations. Their remote nature does not encourage those other things.
Everyone wins online
You should now have a better understanding of why online gambling is so appealing to so many people. Gamblers like it because it is easy and efficient. Operators like it because they have greater access to more opportunities at a fraction of the cost. Governments like it because it is a valuable source of revenue.
The big lesson to be learned here is that online gambling creates a situation in which everyone wins. The online model takes an activity people have been doing for centuries and makes it accessible to gamblers the world over. And that is a good thing.