Funds News

Legalize and regulate online gambling, study urges

TORONTO (Reuters) - Canada and the United States should legalize and regulate online gambling to contain its potentially harmful effects because players tend to bet more frequently and aggressively than they do in casinos, a study released on Tuesday says.

A computer screen displays an online gambling website, October 2, 2006. REUTERS/Toby Melville

The study -- conducted jointly by academics of the University of Western Ontario in Canada and the University of Nevada at Las Vegas -- found that online gambling is readily accessible via the Internet even though it is outlawed or in a “legal grey area” in United States and Canada.

Online gambling is big business, the study said, estimating worldwide spending at more than C$10 billion ($10 billion) a year.

Betting online is a problem, the study says, because it has the potential to be more addictive than casino gambling. Online gamblers can hide their activity more easily than casino gamblers, and betting can quickly become a routine part of their daily lives.

“It brings out the gamblers’ more competitive side,” said June Cotte, associate professor of marketing at the University of Western Ontario and one of the study’s authors.

“When not seen as reserved solely as behavior for an outing or a special occasion, gambling is more likely to become a pernicious, insidiously integrated component of a consumer’s life.”

As part of the study, 20 regular casino gamblers and 10 regular online gamblers were interviewed. Pictures were used as stimuli to find out what gambling feels like and how it is perceived by the participants.

Results show online gamblers bet more frequently and aggressively, the study found.

As one potential solution, the study’s authors suggested that governments encourage large corporations like those that run the major Las Vegas casinos to enter a new, regulated online gambling market. The major Vegas operators include MGM Mirage and Harrah’s Entertainment Inc

Gary Thompson, a spokesman for Harrah’s, said the company has already supported a study looking at the pros and cons of legalizing and regulating online gambling.

Depending on how the government would structure its approach, he said Harrah’s would be interested in exploring the market opportunity.

The study also suggested government sponsors in Canada might enter the market and regulate it with measures like more effective age checks when signing up, setting limits on bets and implementing mandatory “cooling-off” periods that force gamblers to stop betting for a set amount of time.

($1=$1 Canadian)

Reporting by Wojtek Dabrowski; Editing by Frank McGurty