| Gaming-News > Archive > 2006 > September |
28 Sep 2006
Investors in gambling online – whether it is poker or any other casino game – should be aware of how the regulatory crackdown and arrests in the US have hit the pipeline of gambling flotations. Investors might not have expected such a continued run of bad luck regarding the collapsing value of gambling companies online. It has also hit the prospects of those gambling companies hoping to profit from the tail end of the online poker craze by going public.
All of these latest investment problems have come about due to a combination of a clampdown by US regulators, high profile arrests of executives, and questions over the sustainability of the business model of online gambling companies. Gambling analysts, bankers and investors who specialize in online gambling broadly agree that the outlook for the sector is dismal. A survey by gambling consultancy MECN found nearly 80 percent of online casino industry specialists think the sector outlook is negative, and Fidelity, one of the largest investors in online gaming, has cut it position and warned companies not to float.
‘I doubt any companies will go ahead with IPOs in the near future – the US legislation is too intimidating,’ said a spokesman at MECN. Martin Oelbermann, an analyst at MECN, said a combined crackdown on online gaming by authorities in the US, France, Italy and Germany could do permanent damage to the gambling sector online. Some bankers believe their run of bad luck will change. Only time will tell how the gambling sector online will affect investors in the future.
Investors in gambling online – whether it is poker or any other casino game – should be aware of how the regulatory crackdown and arrests in the US have hit the pipeline of gambling flotations. Investors might not have expected such a continued run of bad luck regarding the collapsing value of gambling companies online. It has also hit the prospects of those gambling companies hoping to profit from the tail end of the online poker craze by going public.
All of these latest investment problems have come about due to a combination of a clampdown by US regulators, high profile arrests of executives, and questions over the sustainability of the business model of online gambling companies. Gambling analysts, bankers and investors who specialize in online gambling broadly agree that the outlook for the sector is dismal. A survey by gambling consultancy MECN found nearly 80 percent of online casino industry specialists think the sector outlook is negative, and Fidelity, one of the largest investors in online gaming, has cut it position and warned companies not to float.
‘I doubt any companies will go ahead with IPOs in the near future – the US legislation is too intimidating,’ said a spokesman at MECN. Martin Oelbermann, an analyst at MECN, said a combined crackdown on online gaming by authorities in the US, France, Italy and Germany could do permanent damage to the gambling sector online. Some bankers believe their run of bad luck will change. Only time will tell how the gambling sector online will affect investors in the future.
