Although California lawmakers won’t be considering online poker legislation again until 2015, they may want to seriously look at interstate compacts.
The most recent bills proposed in the state all had one common theme –restricting play to within state borders by regulating online poker under an intrastate format. The general line of thinking being that with the nation’s largest population at 38 million, California can operate a viable Internet poker scheme without sharing player pools with other states.
Certainly, 38 million is a large enough player pool to draw from to sustain a handful of poker sites. Those sites may eventually generate good-sized revenue numbers as has been projected.
However, ring-fencing the player pool does indeed have its drawbacks. The main one being that there is no room for growth once the ipoker regime becomes established.
What will likely happen, just as has been seen in Nevada and New Jersey, is that players will turn out to satisfy their curiosity soon after launch. But in the months that follow, player traffic will gradually diminish as a number of recreational players find other things to do with their time than to lose money online. It is a typical pattern without an out as there are no more areas in which to attract new recreational players due to the restrictions imposed by the intrastate ipoker model.
The other states that have already or will enact online poker legislation in the future are apparently not restricting themselves to intrastate play. Delaware and Nevada forged the Multi State Internet Gaming Agreement in February and are working on launching interstate online poker as soon as is feasibly possibly.
New Jersey Gov. Chris Christie mentioned at Monday’s summit of lawmakers and business leaders that discussions have taken place regarding interstate compacts with Nevada. The Garden State appears destined to join the pair in due course and may have already done so by the time California legislators debate online poker regulation in 2015.
The latest word out of New Jersey hinted at by Sen. Ray Lesniak is that international compacts may also be in the offing. Opening up the player pool to allow for global participation would do wonders for liquidity, and in turn, revenue as well.
Liquidity is an essential ingredient to maintaining a successful ipoker regime. The greater selection of games available results in even more players being attracted to the scheme. Growth feeds on itself, so to speak.
California, unfortunately, seems intent on limiting its potential by stopping the possibility of growth. The state’s gaming interests do not seem inclined to share revenue with other states. As a matter of fact, those gaming interests still cannot decide on how to share potential revenue with each other.
California may one day be forced to reconsider its desire to go it alone with regard to online poker. Many states may eventually be happily sharing player pools and looking to expand to regions outside of the U.S., while California restricts its opportunities. For that reason, don’t be surprised if Golden State lawmakers and gaming interests come to realize the error of limiting their available player pool, especially if they see successful interstate play among regulated states.