WSJ Predicts Big Future for US Gambling

Venture-backed online gambling start-ups are set to benefit in a big way if the US Congress legalizes certain types on online gambling, a prominent Wall Street Journal blogger has predicted.

In an article published on the same day as two government agencies announced a delay in the implementation of the 2006 Unlawful Internet Gambling Enforcement Act, Ty McMahan wrote that most start-ups believe new laws on gambling won't be enacted until at least the end of 2010, and are using the time to plan accordingly for the future.

He gave GameLogic Inc. as an example of one such company, describing it as a bridge between brick-and-mortar and online gambling that "could easily flip a switch to offer a full-blown online gaming system to its customers."

As McMahan describes it, the Massachusetts-based company offers free games including slot games, card games, bingo, trivia and puzzles that are loaded on online casinos to attract potential customers.

Another example McMahan gives to back up his argument is that of Zynga Inc., creator of the Texas Hold'Em games used on social network websites such as Facebook.

Industry experts estimate the business has been worth between $100 million to $200 million in revenue in the past year alone, according to McMahan, but he predicts that a legal online version of the same games would prove to be significant given that players would then be permitted to actually win money from the activity.