Last week, sitting at an Atlantic City blackjack table, I was carefully following an under-payed and over-worked dealer as she flipped her cards. Feeling pretty confident with my solid 19, I watched with frustration as the dealer hit a 19 of her own. A classic push. However, to my surprise, the dealer matched my 25$ wager, pocketed my cards, and went on to settle bets and collect lost wagers around the table. Reminding myself that the house always wins, I silently allowed myself to benefit from the dealer’s error (and made sure I tipped her after my next win).
Human error versus computer era
Human errors like this one happen countless times a day at every casino. Dealers miscount, absent minded croupiers shift piles of chips from one number to another, balls fly out of roulette wheels and bills stick to one another at cage tills. These types of mistakes, which occur all the time in land based gaming establishments, very rarely happen in online casinos. Quite simply put, the extremely complex computer systems that power online casinos don’t (usually) make mistakes. On the rare occasion they do, these are easily detected and corrected. And yet, the public sentiment about online gaming is often tainted by the fear that online casinos are somehow inherently untrustworthy. Since people can’t see the cards being shuffled or the roulette ball spin, they tend to believe online casinos are either rigged, or vulnerable to fraud, or otherwise unreliable.
The game of trust
In reality, licensed and regulated online casinos are typically mega-million dollar businesses, powered by sophisticated cutting edge technology, and they tend to be far safer, more reliable and less prone to error than their bricks-and-mortar namesake. They are also much less vulnerable to money laundering and fraud (more about that in a future post). No less important than the role consumer satisfaction and confidence plays in ensuring they stay that way, online casinos are subject to rigorous regulatory oversight and controls designed precisely to guarantee they do (and pay taxes, while they’re at it).
In fact, online casinos are far easier to oversee than traditional ones are. Regulators can’t physically audit everything that goes on in a casino, on the gaming floor and behind the scenes. Even if they had the manpower and capacity to review the feed from every ‘eye in the sky’, that data is typically available for no more than 7-10 days before it is overwritten by new data. In contrast, since online casinos digitally record every single action that occurs on each of their many systems, and retain that data for years, a diligent regulator could, at any time and with little effort, harness the power of data-mining technology to audit an online casino’s operations going back years. Furthermore, the systems that power online casinos are subjected to rigorous testing and certification by specialized cutting edge labs.
Regulating the fair game
As the online gaming industry grows, so to do its regulatory constraints. Today, compliance for an online casino means adhering to a long list of locally tailored (and often vastly divergent) regulatory requirements.
And that, dear reader, is what this blog will be about – the challenges and opportunities represented by the dynamic legal and regulatory landscape pertaining to eCommerce in general, and online gaming and financial trading in particular.
As any online gaming exec will tell you, the cost of compliance generates significant value measured first and foremost in consumer confidence. Since regulation comes with a governmental stamp of approval, the online gaming industry has long been waiting to be ‘just as regulated’ as any other legitimate online business. Nonetheless, it is a complex map to navigate, and one that requires constant tweaking and readjustment. Good thing that; otherwise my team and I would soon be out of work (and there’d be no blog for you to read).