Nevada’s Opening Online Casino License Goes to IGT and Bally

International Game Technology and Bally Technologies, two of the leading online gambling service providers were waiting for their license, to begin operations in Nevada. Recently, both of them were granted licenses for beginning online gambling operations from the state, provided the online gambling bill is passed. IGT (International Game Technology) seems to have a head start here as it is a Nevada based company located in Reno. Even Bally Technologies, which is Vegas based, should not have too much of a problem in catching up with IGT .

Approval from Testing Laboratories

Michael Lawton, one of the seniors in the research and analysis group of the Nevada Gaming Control Board, said that the licensing is still incomplete. He said that the companies should have their gaming operation systems checked, analyzed and approved by reputed testing laboratories. An approval by these laboratories is not included in the requirements for obtaining an online gaming license in Nevada. But Lawton said  the procedure will ensure that the online gambling community will be able to wager in a fair and secured gambling environment.

US Gambling Market  to Reach $13.4 Billion Net Worth

With the grant of these gambling licenses, the US online gambling industry (casino industry) is on its way to reach an astounding $13.4 billion five years from now. This figure was calculated in a survey and an estimate conducted by the H2 Gambling Capital.

H2’s director, Simon Holliday, pointed out that a study conducted by his company estimated the total revenue generated in the world from online gambling amounted to $32.8 billion. The largest contributors were the U.K, Germany and Japan. Imagine the world online gambling revenue, when the United States alone contributes an estimated massive $13.4 billion.

Holliday also pointed out that this financial potential was one of the reasons why authorities are so careful while handing out licenses. They want to make sure that the companies have the capability to handle that kind of money and also are legit.

Both the Licensed Companies Expected to Offer Services

Even though Bally and IGT have obtained the license to start their own online casinos, they are expected to offer their services to other companies. This proposition might not seem that lucrative on the outlook, considering the amount these companies spent to obtain operating licenses. However, managing other companies by offering their services to them is the risk-free way to go about it. Both IGT and Bally are renowned for designing and developing world class software and websites. So, serving other companies seems like the safer and better option at this point of time.

The only catch with this approach is that these companies have to wait for other companies to obtain their operating licenses before starting operations. But that might not seem too far ahead, seeing the license has been granted to two companies already.

‘The Dominos Are Falling’

The chairman of the Gaming Control Board, Mark Lipparelli, was contacted via telephone for his views on the granting of the license. He said that it might take a while for the operations to begin as  the approval of technologies from independent labs might take a while, considering the stringent regulations they have to follow. After that, even the casinos should be approved and they perform their own check on the technology that would be employed. Considering all these factors, Lipparelli predicted that it will be the end of this year or the beginning of 2013 before operations start in full swing.

He compared this to the falling of dominos because it is only a matter of time before other companies start applying for gaming licenses and  are granted them. Only the first license takes time. After that, everyone is familiar with the drill. One company after the other will be granted license and the trend will continue.

Other States Might Follow the Trend In The Near Future

Macquaire Capital, an investment firm conducted a survey on the number of applications in different states for authorizing online gambling. Last year, an opinion was issued by the United State Justice Department stating that online gambling could be granted legal status within state borders provided the company abides by the rules and regulations of the state and follows a set of pre-established guidelines. The survey revealed that more than 10 states are considering authorizing a form of betting or have already authorized betting and made it legal if it went through the proper betting firms.

A Variation in the Share Prices of Bally and IGT

Obtaining an online operational license will affect the shares of both the companies in a positive way. Bally has added 17% value to its shares this year, but it dipped to $46.44 recently by 2.2%. IGT’s share values have reduced by 13% so far, but it is expected to rise in the near future.

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