Zynga Invests in US Online Gambling Lobby Efforts

Zynga Inc, a leading software gaming operator famous for the creation of Farmville games on Facebook, has invested in the federal and state lobbying initiatives for online real money gambling. One of the leading social networks, Facebook, has also stepped into the real money online gambling arena. The investment move from Zynga comes as a bit of a surprise as the gaming operator itself has mentioned that theUS will not be the ideal market for online gambling with real money.

Last year, the US Department of Justice amended its ruling on the Wire Act and announced that save for sports betting, all other forms of online gambling was legal. This led to an unprecedented turn of events where several US states clamored to be the first to issue online gambling licenses to appropriate gaming operators as and when a bill is passed at a federal level.

However, with a lack of progress on a bill for the regulation of online gambling, US states are in the process of sanctioning and regulating intra-state gambling. As expected, states have encountered several roadblocks. While supporters declare that an online gambling bill will significantly increase revenue, critics are worried about security issues.

Zynga Unveils New Investment Plan to Attract Disgruntled Investors

Zynga’s decision to invest real money to push an online gambling bill at the state or federal level comes at a sensitive time. The gaming operator recently took a beating when its stock prices plummeted to an all-time low. Zynga, whose financial performance has not impressed investors, stated the investment was a response to the legal alterations and the increase in online gambling players.

To appease the diminishing confidence of its investors, Zynga, which has made lobbying investments in California and Washington D.C. views the move as a timely and smart business opportunity. At present, the gaming operator, which is based in San Francisco, offers poker games which allow players to win only virtual currency and not real money.

Zynga in Talks for Real Money Gambling Games

According to sources, Zynga has already had several talks with a number of potential gaming operators who will be available for a partnership. With a highly popular network, Zynga stands to earn a considerable amount of income if its games are converted to a real money format.

Although several lawmakers mentioned that an online gambling bill may not materialize on a federal level in the near future, several US states continue to be hopeful. The prominent senators from each state have already announced their opinion of the regulation of such a bill.

2013 will be a Profitable Year – Zynga CEO

While Zynga is putting in large sums of money, industry pundits are extremely wary about a regulated online gambling market in the US as they believe it may take more time due to the legalities and technical difficulties involved. After Zynga announced its quarterly results a few weeks ago, Mark Pincus, it’s CEO, held a conference call with several business analysts.

According to Pincus, if all goes well, Zynga will launch its real money gambling games within the first six months of next year. Pincus further stated that although US will provide one of the most profitable online gambling real money arenas, Zynga will concentrate on other international markets for the time being.

When the quarterly results were announced, public documents showed that Zynga had spent almost $100,000 on internet gambling lobbying efforts at the end of June. Realizing that it would need outside assistance, the gaming operator has employed the services of Jones & Stewart Inc., Peck Madigan and Bay Bridge Strategies Inc., which is primarily based in Washington.

Zynga’s Lobbying Efforts in California

The firms will keep a close watch on any events related to the taxation and regulation of an internet gambling legislation in the Senate and House. Zynga had also employed Platinum Advisors to push a bill in California, which was looking to provide licenses to online gambling operators. The state offers possibility as the California Governor has given his approval for the legalization of online gambling.

The legislation, which is known as the Internet Gambling Consumer Protection and Public-Private Partnership Act of 2012, was introduced earlier this year in California. Although it faced a few problems, it is expected to make a comeback. Zynga has disclosed that it has not spent the same amount of money for its lobbying efforts at the state and federal level.

Although the regulation of an online gambling market will assuredly produce great financial results in the US, it will also create several problems. Critics have questioned the feasibility of regulating such markets as there is no way to determine the age of the users involved. As a result, a legislation will encourage underage real money gambling and cause an addiction to it.

Another important reason why the bill is not moving forward at federal and state levels is because of the Indian Tribes. They believe that their current real money gambling operation will suffer in an extreme manner as if online wagering is legalized, there will be a proliferation of online casinos.

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