by Sandra Rosenzweig

Place your virtual bets. by the year 2000, according to conservative estimates, online gambling will be an $8-$10 billion business. About 20 sites already offer live, online betting on casino games, sporting events, and lotteries. This is big business, and it's only going to get bigger. Craig Fields, the former head of the government agency that developed the Internet, now sits on the board of Alliance Gaming, a publicly traded Las Vegas gambling equipment manufacturer and developer of online gambling applications. "I think [online gambling] is going to be received as an entirely new form of entertainment," he told the New York Times in 1995. "The prospects are not modest."

It makes sense. Gambling is a perfect online fit. Buying a lottery ticket online, for example, will be roughly the same as going into a liquor store to buy one, except you won't have to step over the winos. Video poker should also prove popular on the World Wide Web; it's already one of the most lucrative games at a majority of the country's Indian and high-stakes casinos. You like it because you're shy about playing at the tables. Or you like it because you grew up with Nintendo's Super Mario Brothers and Sega's Sonic the Hedgehog. How much different will it be to play it at home?

A few impediments do exist, though. For instance, how do you know a fix isn't in? What guarantees do you have that the virtual blackjack deck was shuffled fairly? How do you know the virtual dice aren't virtually shaved? And even if the games are honest, how do you know you'll see your winnings?

Because the legal status of Internet gambling in the United States isn't clear yet, heavily regulated corporate gambling houses such as Hilton Hotels and Harrah's haven't dared enter the fray. If they are caught committing even one illegal act, they risk losing their licenses permanently. So the online field is populated by start-ups -- unknown, unregulated, unfettered, and usually offshore. To become a virtual casino operator, all it takes is a room with a closet big enough to hold a server, a router, and a T-1 line.

Where operators set up shop is another question. Gambling laws, largely under the purview of the states, vary across the country. But thanks to the Web, bettors may simply take online trips out of state to avoid local prohibitions and lay down the wager of their choice.

(Continued)

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