Wilkie's online gambling problem

Andrew Wilkie and Nick Xenophon may continue their push on pokies, but the internet will soon ensure their efforts are largely irrelevant.

Andrew Wilkie and Nick Xenophon needn’t worry: the pokie barns will soon be deserted because the customers will be at home gambling on their computers or online TVs or iPads or smartphones.

Gambling is one of the industries being disrupted and/or ruined by the internet, joining a long list: photographs, encyclopedias, books, newspapers, film, music, retailing, postage etc.

So, unfortunately, by the time squirming politicians get around to doing something about problem gambling in 2016, the problem will have been solved for them. Those whom Messrs Wilkie and Xenophon, ably supported by the Productivity Commission, are trying to protect will have quietly gone home to hand over their money to foreign bookies and thieves in private.

The Productivity Commission’s detailed report into Australia’s gambling industries in June 2010 was a shocking indictment of a nasty, predatory industry and, by implication, the lazy politicians and bureaucrats who use it to tax the poor and vulnerable.

It said gamblers lost an average of $1500 each in 2008-09 (it’s no doubt a fair bit more now), that 600,000 people play the pokies at least weekly and that 15 per cent of them lose 40 per cent of the money because they’re addicted to it. In a passionate departure from its usual focus on business and market efficiency, the PC recommended some sort of pre-commitment regime as well as an upper limit of $1 per bet to help the addicts control their problem.

As a direct result of that, the independent Member for Denison, Andrew Wilkie, went into the negotiations in August of 2010 following the election of a hung parliament demanding implementation of both the PC’s recommendations in return for his vote in parliament. The eventual Prime Minister, Julia Gillard, agreed to do pre-commitment but not $1 bets.

Now, following ferocious lobbying from those who harvest the gamblers’ losses – including state governments – she is squirming. Pre-commitment will now be studied, not just introduced. Wilkie hasn’t got what he asked for, but is the delay sufficient for him to bring down a government? Probably not, so he’s in a difficult spot. Xenophon, meanwhile, has switched to demanding $1 bet limits, but he’s in the Senate and doesn’t have a casting vote.

Meanwhile, Southern Cross University’s Dr Sally Gainsbury yesterday produced research showing that the use of internet gambling has accelerated in the past two years – that is, since the Productivity Commission collected data for its 2010 study.

Gainsbury and a group of other researchers surveyed 6680 people, of which 2270 – a third - were internet gamblers. Of them, 450, or 20 per cent, called themselves ‘problem gamblers’. Their losses averaged $825 a month.

Nick Xenophon, among others, is now calling for the government to "do something” about online gambling, but what? Online poker and casino games could be banned in Australia, but players have access to any number of sites based overseas.

In any case, online wagering is allowed and as a result, sport betting in general is exploding and disrupting the traditional off-line operators and totes.

This morning Wikipedia is still blacked out in protest against the ‘Stop Online Piracy Act’ and the ‘Protect Intellectual Property Act’ (known as SOPA and PIPA), which the editors of Wikipedia say represent an unacceptable intrusion into the freedom of the internet.

That legislation is an attempt by a group of 42 US legislators to prevent some of the internet’s disruptive powers. President Obama has never supported it, and yesterday, in the face of Wikipedia’s blackout, three of the bills’ sponsors made their excuses and backed out.

China’s Communist Party does pretty well at controlling the internet. When I was there last year, I could not get access to YouTube, Twitter or Facebook as soon as I crossed the border. There were ways around the blocks through virtual private networks, and social media sites are popping up within China, but the Commies are showing you can control it.

But I’d say it won’t be controlled in the west, and that the internet walls will eventually come down in China, thus adding the Chinese Communist Party to the list of industries being disrupted by the internet.

That means online gambling won’t be controlled, and the clubs, companies, politicians and other vultures that harvest the cash of those who currently have to show up at venues to lose money, will lose their prey – not to Andrew Wilkie and Nick Xenophon, but to rather more shady characters in Nigeria and Russia.

Follow @AlanKohler on Twitter

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