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Is there a full U.S. pull-out, or only a restriction on new signups?
November 10, 2008 (InfoPowa News) — Conflicting reports, exacerbated by confusing communications to affiliates from some managers at Microgaming-powered groups, and what appeared to be restricted access to the Microgaming website, all combined as last week ended to create alarm regarding the U.S. intentions of the software provider and its licensees.
The largest of the companies still offering online casino action to (some) U.S. players, Microgaming licensees, and the software provider itself, featured with other domain owners in court documents filed in Kentucky recently as the state tried to curtail Internet competition for its land gambling interests.
In emails to affiliates, some casino managers and affiliate administrators emphasized that the operators had requested that Microgaming halt new U.S. registrations, and this would come into effect on November 10 … but that existing players would not be affected if they were not resident in the 13 “banned states” that expressly prohibit online gambling. The state of Kentucky has now been added to this list, presumably as a consequence of the domain hijacking attempt by that state (see previous reports).
At least two other groups said that in addition to the new registrations ban on November 10, they would be closing their doors to all U.S. players effective December 1st 2008, and urged affiliates to switch their marketing focus to other regions.
Adding to the alarm and speculation were reports that the Microgaming website was down, although it later transpired that it was accessible by most U.S. players but not those in Nevada, Georgia, or Tennessee. The reasons for this are not known.
Microgaming itself remained silent, although unofficial sources indicated that the Isle of Man-based company could be planning to issue a statement on Monday — the cut-off date for new registrations. Hopefully this will bring some clarity for players, affiliates, operators, and industry media alike.
Speculation that the move may be connected with recent reports that the newly drafted UIGEA regulations were forwarded to the U.S. government’s Office of Management and Budget on October 21st have been discounted as unlikely. The proposed regulations are now open to review for sixty days and are still the subject of discussion, and have been under the spotlight of public debate and litigation for many months.
In situations such as this, speculation runs rife and has included assertions that Microgaming is about to go public (unlikely), or is in the first stages of a total pull-out of the U.S. market. The latter theory appears to have the most traction, with proponents reasoning that merely restricting new registrations while allowing existing players to continue does not make sense if the motive for the exit is the increasing difficulty of doing business in the U.S.A. The costs of payment processing and legal difficulties affect the administration of new and existing players equally.
The uncertainty created by the current situation is not good for business, as players become anxious about the safety of their deposits and account balances in the event of a sudden closure. If such a closure is inevitable, it behooves Microgaming and its licensees to communicate clearly and effectively … and set up an orderly retreat with sensible timelines.
Microgaming spokesman comments on new U.S. registration bar
The latest update on this story:
November 10, 2008 (InfoPowa News) — Following emailed advisories to affiliates by several Microgaming-powered online gambling groups that new U.S. signups would not be entertained from November 10, InfoPowa today asked a senior Microgaming spokesman for comment on the issue. He explained as a point of departure that, as a software provider, the Isle of Man-based company does not dictate policy or corporate strategy to its licensees, all of which are independently owned companies.
Regarding the ban by licensees, he said: “Several of Microgaming’s clients, who represent most of the U.S. licensee business, last week decided that the current commercial uncertainty of investing in business from the United States no longer justified accepting new player registrations. The U.S. share of business has been declining for some time, and a number of licensees have already intimated to affiliates that they will no longer be taking U.S. play.
“That is a decision for individual licensees, who act in the best interests of their companies.
“Play from certain U.S. states was in any event not accepted by Microgaming licensees, and has not been for some time.
“In the light of these decisions, Microgaming did not believe the volume of remaining business warranted the remainder of U.S.-facing licensees keeping their systems available for new registrations, given the technical difficulties of maintaining an effective screening for all circumstances. After discussions with these remaining licensees, Microgaming will from today [November 10 2008] be implementing the decision not to accept new U.S. registrations.
“Microgaming is confident that its licensees will be dealing with their players and affiliates in a fair and reasonable manner. In any event, industry player protection bodies such as eCOGRA will be prepared as usual to assist any players who have complaints.
“Microgaming cannot comment on the order for seizure of domain names by a court in Kentucky, as the matter is in the hands of lawyers.”
The comments confirm earlier reports reaching InfoPowa that the initiative for the ban originated with licensees discouraged by the continued and possibly worsening uncertainties of doing business in the United States. The fact that licensees are independent of the software provider and make their own policy and business decisions perhaps also explains why some licensees have told affiliates that they will cease doing business in the U.S.A. from December 1, while others have not.
That wins the award for the most disingenuous press release of all time.
To whit : “…the company [Microgaming] does not dictate policy or corporate strategy to its licensees, all of which are independently owned companies.”
And : “Microgaming did not believe the volume of remaining business warranted the remainder of U.S.-facing licensees keeping their systems available for new registrations..”
So, in short, Microgaming will allow their licensees to make independent decisions, unless MGS says otherwise.
So MG are basically sticking the blame on Carmen Media. They requested a withdrawal from the US, and therefore everyone gets pulled? LOL. I like MG but that’s the least convincing excuse I ever heard. If some operators wanted it, why didnt those operators just block the IPs on their websites? If I was one of the operators who didn’t, I’d be well pissed off. Although I guess they can get their licence fees back.
I’ve never known an industry that tries so many times to commit suicide without ever quite pulling it off :3eyes:
here is what I got out of it.
Its real hard to determine if a new player is legal or not in the states so MG is giving up tracking down every new player. No new players.
Players already figured out are OK with MG
If an operator wants to turn off all exsisting US accounts its up them.
I’m not quite sure what people expect Microgaming to do.
They can make an honest Euro (or several million) by servicing clients that want to offer gaming to the countries that allow it, and they do that quite well. In fact their software is considered premium.
With the on-going legal issues and ramifications in the politically flexible US, they’ve decided that it’s too difficult to continue to walk the tightrope offering services to new US players given the obvious intent of the current lawmakers and the legal clout that they still wield.
(even though we’re aware that the question as to whether it’s REALLY illegal is very murky – the feds and now individual states keep saying it is and taking action as such)
I’m not to up on the exact definitions of aiding and abetting criminal activity, but I suspect that maintaining and licensing a gaming platform to people that MG KNOW are providing online gambling services to an area that MG KNOW is saying it’s illegal is probably in that definition of aiding and abetting …
Microgaming simply do not want to pick a sh!tfight with the biggest legalistic bully on the block – the Government of the United States. They are a software company. They want to create good gaming software, and operate it legally, not go on a risky and expensive crusade to force online gaming on the US. (when has ANYONE forced the US to do ANYTHING?)
Personally I don’t blame Microgaming – despite the effect it’s gonig to have to our back-pocket. The change has to come from within the US.
I pretty much agree with your assessment of things, Gooner. But if you’re right – and I suspect you are – then why don’t Microgaming just come out and say that they (as software provider) are withdrawing from the US market rather than put out contradictory and misleading press releases.
I understand all angles of this, and naturally we are ALL hugely disappointed that MGS is leaving for whatever the reasons are.
Certainly the Programs that will continue to serve exsiting U.S. Players and pay affiliates for them need to be appreciated for doing that.
I’m not convinced we actually know what the real reasons for the MGS decision yet, and probably won’t until the Kentucky thing is resolved and those domains transerfered to safe haven.That said, after carefully reading thru the two news releases above, I would like to know if anyone can confirm the following comment?
Speculation that the move may be connected with recent reports that the newly drafted UIGEA regulations were forwarded to the U.S. government’s Office of Management and Budget on October 21st have been discounted as unlikely. The proposed regulations are now open to review for sixty days and are still the subject of discussion
That would be important breaking news to me.
If I’m not mistaking, 60 days will take us past the start of the 110th Congress which I think is Jan 4th.
If that’s true, and I’m not sure people, but I think that would kill a Midnight Drop on the UIEGA Regs.Anyone here 100% up to snuff on this???
Not sure about Congress but I do know that Obama’s reign doesn’t start til later in January. And the “midnight drop” last time was tacked onto the back of a must pass Bill – couldn’t they do the same again in the new Congress if need be?
@TheGooner 185833 wrote:
I’m not quite sure what people expect Microgaming to do.
They can make an honest Euro (or several million) by servicing clients that want to offer gaming to the countries that allow it, and they do that quite well. In fact their software is considered premium.
With the on-going legal issues and ramifications in the politically flexible US, they’ve decided that it’s too difficult to continue to walk the tightrope offering services to new US players given the obvious intent of the current lawmakers and the legal clout that they still wield.
(even though we’re aware that the question as to whether it’s REALLY illegal is very murky – the feds and now individual states keep saying it is and taking action as such)
I’m not to up on the exact definitions of aiding and abetting criminal activity, but I suspect that maintaining and licensing a gaming platform to people that MG KNOW are providing online gambling services to an area that MG KNOW is saying it’s illegal is probably in that definition of aiding and abetting …
Microgaming simply do not want to pick a sh!tfight with the biggest legalistic bully on the block – the Government of the United States. They are a software company. They want to create good gaming software, and operate it legally, not go on a risky and expensive crusade to force online gaming on the US. (when has ANYONE forced the US to do ANYTHING?)
Personally I don’t blame Microgaming – despite the effect it’s gonig to have to our back-pocket. The change has to come from within the US.
I don’t believe in the honest Euro story. If they wanted to abide by any law and stay honest why are they happily acquiescing to their licensees roaming around in the German, French, Italian, and Scandinavian markets. Thereby turning a blind eye to the making of many millions of practically illegal Euros.
The buck stops for them only when their own behinds are on the line and there is a real danger of landing in prison or being subjected to really inconvenient legal procedures. Something that apparently is not imminent in the EU market for whatever reason. Probably due to the stand off between national governements and the EU administration on the gambling issue. :sarcasm:
couldn’t they do the same again in the new Congress if need be?
I’m not sure Simmo! LOL
The transfer of power/inaguration is January 20, I believe, but I think all unfinished business by this Administration needs to done before the end of the 109th Congress.
That’s why that comment jumped out at me.
Last I knew they were going to try to drop it in the next few weeks.:Cry:Slight correction.
We are in the 110th Congress, but that session ends in December, and the next session of the 110th should begin around January 3rd or 4th.Same result, just had my Congresses out of whack!:roflmao:
The problem I see is that other countries are more likely to follow suit, seeing that the US efforts have been successful, even without having to get any support from the US people.
I know countries like Canada will now be more likely to follow. Microgaming’s unwillingness to fight could hurt them in the long run. :flush:
