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Poker played online has been responsible for the dramatic increase in the number of poker players. Traditional (or "bricks and mortar", B&M) venues for playing poker, such as casinos and poker rooms, are intimidating for novice players and located in geographically disparate locations. Brick and mortar casinos are also reticent to promote poker because it is very difficult for them to profit from the activity. Though the rake or time charge of traditional casinos is often very high, the economic costs of running a poker room are also very high. Brick and mortar casinos often make much more money by removing poker rooms and adding more slot machines.
Online venues, by contrast, are dramatically cheaper, due to the online venue having much cheaper maintenance costs. For example, adding another table does not take up valuable space like it would for a brick and mortar casinos. Online poker rooms tend to be viewed as more player-friendly. For example, the software may prompt the player when it is his or her turn to act. Online poker rooms also allow the players to play for very low stakes, attracting beginners.
Online venues may be more vulnerable to certain types of fraud, especially collusion between players. However, they also have collusion detection abilities that do not exist in brick and mortar casinos. For example, online poker room security employees can look at the "hand history" of the cards previously played by any player on the site, making patterns of behavior more easy to detect than in a casino, where colluding players can simply fold their hands without anyone ever knowing the strength of their holding.
The major online poker sites offer varying features to entice new players. One common feature is offer tournaments where the winners gain entry to real-life poker tournaments. It was through one such tournament that Chris Moneymaker won his entry to the 2003 World Series of Poker. He went on to win the event, causing shock in the poker world. The 2004 World Series featured triple the number of players over the 2003 turnout. Like Moneymaker, the 2004 winner, Greg "Fossilman" Raymer, also won his entry at the Poker Stars (http://www.pokerstars.com) online cardroom.
In December 2003 it was reported that online poker revenues stood at around $34m per month, and were growing by 27% per month. At peak times over 40,000 people are playing for real money at the various cardrooms, with a like number playing free games.
Legality
According to Professor I. Nelson Rose, one of the world's leading authorities on gambling law: "no United States federal statute or regulation explicitly prohibits Internet gambling, either domestically or abroad." Additionally, in February 2001, a New Orleans US District Court ruled: "'in plain language' [the US Federal Wire Act] does not prohibit Internet gambling 'on a game of chance.'" This ruling was subsequently upheld by the US Fifth Circuit Federal Appeals Court. Unlike merely playing, owning such an operation is more likely to be considered illegal. Some states have specific laws against online gambling or gambling of any kind. Furthermore, no one can operate a gambling venture for profit in the United States without a license, and no states are currently granting online poker licenses.
The government of the island nation Antigua, which licenses Internet gambling entities, made a complaint to the World Trade Organisation about United States actions to impede gambling online. The Caribbean country won a preliminary ruling but the US government is expected to appeal.
In April 2004, Google and Yahoo!, the two world's largest search engines announced that they were removing online gambling advertising from their sites, and that this included poker. The move followed the United States Justice Department's announcement that it intended to apply legislation from 1961 Wire Communications Act relating to telephone betting to the Internet in order to crack down on online gambling advertising. It says gambling is open to fraud. Critics of the Justice Department's move say that they have no legal basis for pressuring companies to remove advertisements and that the advertisements are protected by the First Amendment.
While online poker's legal status in the United States is unclear, it is legal and regulated in other countries. For example, playing online poker is considered legal in the United Kingdom.
Selected popular online poker sites (external links)
References
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