Today’s NY Times article about PartyGaming is pretty interesting.
A giant in the online gambling business, PartyGaming is an often-overlooked megasurvivor from the dot-com crash of the late 1990's. As hundreds of profitless commercial sites disappeared into the digital ether, PartyGaming's popular gambling sites - like PartyPoker.com - soared, with revenues and profits growing exponentially year after year.
This week, the company will go public in what is expected to be the largest offering in years on the London Stock Exchange, one that will make billionaires out of its ragtag assortment of founders and major stockholders - including a California lawyer who earned her first fortune in online pornography and phone-sex lines. All told, as much as $9 billion is expected to be raised, with all of the cash going to private shareholders selling portions of their stakes.
But there will be no Wall Street investment houses lapping up fees in the giant deal, no victory dances in the offices of American corporate lawyers. That is because PartyGaming, based in Gibraltar, has no assets in the United States, and its officers or directors could risk being served with a civil suit - or an arrest warrant - if they came to the United States on business.
This article demonstrates two points:
(1) You can make lots of money by providing people with a service that they want, and people really want to gamble.
(2) The old laws don’t work so well in the new internet age, but our lawmakers have yet to wise up to that fact. Just as law enforcement is unable to prevent people from downloading music files, they are unable to prevent people from playing online poker.
This is an often overlooked aspect of globalization, the globalization of moral standards.
Just as people in Southern rural communities and the Arab world can watch cable TV and view internet porn sites, and are upset by the “immorality” they see there, Americans can access internet gambling sites in foreign countries that have more lenient views on gambling. There is a huge divide in moral standards between the Arab world, where the most conservative want women covered from head to foot, to European beaches, where women are routinely topless. With satellite TV and the internet, countries have been only partially successful in imposing local moral standards. This is one of the reason they hate America, because they view America entertainment as morally corrupt.
In the short term is would seem there is little that can be done about this. There are child porn sites operating out of Russia that take credit cards, because child porn is not illegal in Russia (perhaps the age of consent is just much lower, I’m not sure). The US has not been able to get these sites shut down or block access to them by Americans.
The drive to globalize moral standards is going to be a major source of world conflict for the next generation at least.
Posted by: mikeca | June 27, 2005 at 02:32 PM
mikeca, excellent point!
Posted by: Half Sigma | June 27, 2005 at 03:29 PM