[ QUOTE ]
http://www.china-embassy.org/eng/xw/t180602.htm
http://news.777.com/2007-01/china-bu...gambling-cases
They are deadly serious about shutting down any site that isn't owned by the government.
They are however, investigating the potential of licensing operators in Macao (which basically give most of their profits to the Chinese government) to allow online gambling in China.
See here:
http://news.com.com/2061-12572_3-6115701.html
[/ QUOTE ]
I spoke with the News.com reporter at the ThinkEquity Growth Conference in San Francisco before he interviewed the executives of GigaMedia and PacificNet for the article.
Getting a LEGAL license to operate online gaming anywhere within "Greater China" (mainland China, Macau, Hong Kong, Taiwan) will NOT be a straight-forward process.
1. Online gaming already exists in Macau, with Stanley Ho's SJM operating internet betting websites for Macau residents to bet on horse racing and greyhound racing taking place at SJM's race tracks in Macau.
However, it is unlikely in my opinion for any of the 6 gaming licensees or sublicensees in Macau will get an online gaming license from Macau that will allow any of them to operate anywhere else besides Macau.
2. In Hong Kong, the law of the land is very simple: with the exception of neighborhood Mahjong "schools", the Hong Kong Jockey Club (HKJC) has a TOTAL MONOPOLY on legalized betting. Any person who is physically in Hong Kong who is caught making a bet with any entity other than the HKJC is subject to criminal penalties. Because the HKJC contributes way too much in tax revenue to the Hong Kong government, there is no way the Hong Kong legislature will want to break the HKJC monopoly in the forseeable future.
The likes of PartyGaming, which does want the Hong Kong market, has no choice but to negotiate with the HKJC for a "partnership". Obviously, the likes of Playtech and Cryptologic are also pitching their software to the HKJC. As far as I know, neither PokerStars nor FullTilt have approached the HKJC at this time.
In other words, the HKJC holds ALL the "aces" when it comes to ever allowing online Texas Hold'em to be available legally in Hong Kong.
3. The law of the land in Taiwan is also very simple: the Ministry of Finance (MoF) has a TOTAL MONOPOLY on all forms of legalized gaming with the exception of horse racing. The MoF, which licenses ONE and ONLY ONE bank to run the Taiwan National "Welfare" Lottery (to raise money to run various charities), recently awarded a new 5-year contract to ChinaTrust Financial.
Again, the MoF in Taiwan holds ALL the "ace" cards when it comes to offering legal online Texas Hold'em in Taiwan. Any outfit (PartyGaming, GigaMedia/EverestPoker, Cryptologic, Playtech, etc.) who wants to offer its online Texas Hold'em software to a monopoly gaming licensee (i.e. whichever bank that holds the national lottery license) in Taiwan will have to negotiate with the MoF.
4. Mainland China is similar to Taiwan with its own Ministry of Finance (MoF), which has a national "welfare" lottery agency supervising various regional "welfare" lottery commissions. (The national lottery agency also runs the Beijing regional lottery.)
Mainland China does have one thing that Taiwan does NOT have, the "Great Firewall of China", which is managed by the Ministry of Information Industry (MoII)
The MoII can and will block any offshore online gaming outfit that attempts to do any kind of marketing in Mainland China.
888.com was one of the offshore sites that was recently blocked by the MoII after 888.com signed 19-year-old Chinese snooker sensation Ding Junhui (who lives and competes in the United Kingdom) to a sponsorship contract.
PartyGaming had to voluntarily block all IP addresses originating from China while it negotiates with the MoF and various regional lottery systems for partnerships.
As far as I know, neither PokerStars nor FullTilt have begun negotiations with the MoF in China, though both outfits obviously would like to be able to do business in China sometime in the future.
--
"Greater China" is obviously the "next frontier", and some would say the "last frontier" for Texas Hold'em. How everything will play out in the next 3 to 5 years is still anyone's guess at this point. One thing is for certain: there will be a big buy-in televised Texas Hold'em tournament in Macau sometime within the next 24 months simply because there is too much TV money for various promoters (i.e. WSOP and WPT) NOT to do something in Macau, which has already surpassed Las Vegas as the #1 gambling market in the world in terms of gaming revenue.
(The WPT in particular can't wait for the MGM Grand Macau to open by the end of 2007 or early 2008.)
--
I would also expect Vietnam, a much smaller market compared to China, to play itself out within the next 3 to 5 years. (Vietnam also has a Ministry of Finance running its own national welfare lottery agency.) The Vietnamese poker contingent in the U.S. is obviously drooling at the prospect of being able to land in Vietnam as "rock stars" and be able to endorse products in their own homeland.