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High Rollers

Rise in Internet gambling reveals secret economy of online sports books

By Joab Jackson

LAST FALL, members of the All Star Sportsbook website experienced a rude shock when attempting to place online wagers. They had found that All Star's servers had crashed from the wave of bettors wanting to get in on the N.F.L. action. "We apologize for the series of system failures during this past weekend," read an e-mail sent out to account holders on Sept. 22 by All Star. "We had earlier upgraded our servers in an effort to prepare for football season; unfortunately, despite this upgrade, we were overwhelmed by volume reaching over 30 times our previous peak."

All Star's crush of users is a good indicator of the sudden popularity of online sports books. Here are websites where you can bet on anything, from football to the 2000 presidential election. Most of the wagering, however, is on sports, at least at sites like Sports Interaction, Bowman International, and others listed by Bettorsworld, the unofficial watchdog website of the industry. Fearing fluctuations in U.S. law, most of these businesses are based outside the country, usually in the Caribbean. Last January, the Washington Post estimated that there were about 30 sites accepting online bets.

IN MANY WAYS, international online sports books are the old street-corner bookie gone electronic. Once upon a time, you'd do your betting through a bookie. You could always catch him at a bar, or he'd come around to your job site once a week or so to take bets on upcoming games--football, baseball, whatever. If you were a bit short, he'd spot you. He kept all the numbers in his head. If you had an unusual idea for a wager, he'd ponder a bit and come up with some odds to accommodate you.

What was righteous about the street-corner bookie was that he wasn't playing against his customers, as do casinos that profit by keeping the odds in their favor. The bookmaker was just the guy who kept the odds for the neighborhood. He held everyone's bets and skimmed the top. You weren't playing against your bookie; you were playing against his other customers. If you were really studious about the games, you could actually come out ahead--theoretically, anyway.

What Internet sports wagering does is press the secret economy of the bookie into the mainstream. It can't be ignored as easily.

It is this proliferation of online betting that has prompted the U.S. Senate's Internet Gambling Prohibition Act of 1999 (S692) that, if passed, would do just what the title says: prohibit online gambling. It's the convenience of Internet wagering that spurred the bill's proponents to action.

"We don't want to see America's living rooms turned into betting parlors," Sen. Richard Bryan, D-Nev., told Wired magazine. While you have to wonder about the motivations of a senator from Nevada--where in-state phone-based sports books are legal--he does have a point. Last June, the congressionally mandated National Gambling Impact Study Commission (NGISC) warned that gambling in the United States had already reached epidemic proportions. The country has experienced a 1,600 percent increase in legal wagering revenues--money made by casinos, state lotteries, race tracks, etc.--from 1976 to 1997. And, as NGISC notes, online betting will take convenience gambling to new levels. Many states already have slot machines and keno games in bars and supermarkets; with the Internet, you don't even have to leave home.

IN TERMS of convenience, however, not all online gambling is the same. Downloaded casino-connected slot machines, with algorithms calculated to pay out a certain percentage, might very well be the crack cocaine of the gambling world. Like those zombified old folks with the buckets of quarters you see haunting casinos at 4 a.m., home gamblers can get a hit of their chosen excitement every few seconds.

Sports betting spreads the entertainment dollar out over a few hours. You're wagering on God's own algorithm. A quarterback might twist an ankle, a race-car driver might blow a carburetor. Who knows what'll happen? The Man moves slowly. You have to sit and watch. For many, gambling makes events more entertaining, a fact major sports leagues probably recognize if not publicly admit.

Certainly, I wouldn't have tuned in to NASCAR's Winston 500 on Oct. 17 if I hadn't put $20 on driver Jeff Gordon. I figured to latch on to Gordon's recent winning streak, so I registered and wagered at Sports Interaction, using a credit card. It took me all of five minutes. Microsoft's site should be so user-friendly.

While listening to the race on the NASCAR site, I rummaged through Sports Interaction. Golf, cricket, tennis, snooker, horse racing, rugby, cricket, and even "Gaelic games" could be wagered on, as could the upcoming presidential election and the Booker Prize, an annually bestowed U.K. literary award.

Naturally, Gordon limped in at 12th place that afternoon. My $20, which I never saw, vanished effortlessly into cyberspace. The NGISC was right. Never before has it been so easy to bet money--or to lose it.

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From the December 9-15, 1999 issue of the Sonoma County Independent.

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