Cable World: Web Gambling Not Dead Yet

The Internet Gambling Prohibition Act suffered a setback in the U.S. House of Representatives July 17; however, the legislation designed to control online gaming is far from dead. Congress has recessed until September, when it will reconvene for a campaign-shortened, three-week session.

For the evolving Television Games Network (TVG), owned by Gemstar-TV Guide International and Youbet.com, a broadband provider of racing data and streaming video signals, the signs are still positive.

TVG operates in three states and via DISH Network, showing live horse racing and accepting wagers via remote control. Youbet.com provides the user with wagering information, streaming video of horse races and point-and-click wagering.

"For any sort of complicated issue it would be very rare to get suspension of the rules and two-thirds vote," says Tim Smith, commissioner of the National Thoroughbred Racing Association.

The vote to suspend House rules and pass the legislation (H.R. 3125) without bringing it to the floor for amendments did not garner the two-thirds majority needed. The final tally was 245 to 139 with 30 abstentions. Similar legislation in the Senate, referred to as the Kyl Bill, passed last year.

H.R. 3125 must now be presented to the House floor in September and be subject to scrutiny and amendments, especially from anti-gaming lobbyists.

The legislation would prohibit the proliferation of casino gambling on the Internet, making it a federal crime. The contentious points among lawmakers are the "carve-outs" that exempt Internet wagering on horse racing, dog racing and jai-alai from the bill. Some Democratic lawmakers want state lotteries exempted as well, while others want no carve-outs whatsoever.

Tony Batt, a lobbyist for Dorney Media Group, notes the Clinton administration publicly opposed the bill for the first time July 17.

"They stopped short of using the word `veto,'" Batt says. "The administration just said they were against it. This will be very interesting, because even if the president vetoes this, there seems to be a two-thirds majority in both houses to override it."