Fitch Ratings: Online Poker Won’t Happen Until 2013
September 17th, 2012 by Site Admin
Fitch Ratings rendered its outlook for the online gaming industry last Thursday. According to their analysts, the federal government won’t legalize online gaming this year. This outlook has been shared by many other experts, including Harry Reid and other advocates of online poker.
Fitch cited two key challenges that are holding back a bill that would legalize online gaming. The biggest problem is the growing disparity between republicans and democrats in their view on online gaming. In addition, many of the politicians who have played a significant role in the discussions are retiring this year.
Michael Paladino is one of Fitch’s chief analysts. Paladino referenced the Republican Party’s new platform that would ban online gaming. That initiative isn’t necessarily a nail in the coffin for online gaming. However, it makes it unlikely that Congress will pass a bill that would legalize online gaming in the near term.
Fitch said that the outlook poses challenges for many of the casinos that are hoping for online gaming legislation. The rating agency recently downgraded the outlook for Caesars Entertainment. The downgrade was primarily due to concerns about the firm’s financial stability. However, analysts also stated that part of the reason the downgrade was implemented was due to the decreased likelihood that online gaming would be legalized in Washington.
Caesars intends to make online gaming a priority if it is legalized in the United States. The firm is likely to have a more difficult time resolving its financial problems without a bill that would regulate the industry. Other firms may be in the same position as they intend to pursue the market for online gaming in the United States.
Despite the challenges the industry faces, Fitch acknowledges that there are factors that yield more hope for those waiting for online gaming legislation. The Justice Departments new interpretation of the Wire Act last December and a federal judge’s ruling that online poker is a game of skill have increased the likelihood that online gaming will be legalized in the future.
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