“Online Gambling Business Growing by Leaps and Bounds”

As Internet gambling grows more and more popular, many businesses associated with it – software companies, online payment processing companies – are also reaping the benefits. Investors are also paying close and serious attention.

The ease and convenience of being able to play from home, the resurgence of interest in the game of poker, and improved broadband and cellular technology are a few of the reasons behind the huge recent growth in online gambling. In addition, the online gambling industry has attracted whole segments of the population previously uninterested in or intimidated by conventional casinos or betting houses: the young, the affluent and the female.

Given this popularity, the upsurge in shareholder and client interest doesn’t come as a big surprise. Just as the online gambling business has many appealing features for players, it is also quite attractive to investors, even high level institutional ones. With no distribution costs, logistical problems or production, stock or storage costs, investors are seeing a lot of upsides in the online gambling industry compared to conventional businesses. Other businesses with peripheral connections to the Internet gambling world are also reaping the benefits. One such business, CryptoLogic, develops software for Internet games. Another, NETellar, is an online payment processing company.

Further proof of the phenomenal growth in this particular industry is the fact that Internet gambling companies have begun to list their companies. 888.com listed this year with a valuation of 830 million pounds (1.6 billion dollars). Credit Suisse First Boston will be preparing the floatation. Not surprisingly, many online gambling companies are choosing to list in London, as it is quite receptive to the online gambling industry. The United States, on the other hand, is doing all it can to ban online gambling activity – a curious fact given that Americans make up the majority of online gamblers!

With estimations that the online gambling market will grow to more than $10 billion a year, investors and analysts are watching closely to see what particular facets of the industry will be primarily responsible for driving that growth. At the moment, sports betting accounts for 45% of the market. 32% is comprised of other online gambling games. But by 2008, or maybe even before that, many are saying that the game of poker will overtake both segments. Internet bingo and skill games are also expected to take off, but no one’s debating the fact that poker will be the hands-down winner!