Harrahs Hypocritically Eyes European Online Gamblers

Harrah's Entertainment, the US based gambling company, has taken another important step forward into the world of online gambling, with an important announcement last month. The group said that it had launched a new division, Harrah's Interactive Entertainment, to be known as HIE, that would explore ways to enter the European gambling market and also as a tool to market the group's World Series of Poker brand.

Industry analysts strongly believe that Harrah's Entertainment is set to partner with Party Gaming, the Gibraltar based group that recently settled with the US Department of Justice over charges of illegal gambling activity prior to the introduction of the Unlawful Internet Gambling Enforcement Act. This is the same act that Harrah's effectively bankrolled by giving Senator Frist huge campaign contributions just before he added UIGEA to that Port safety bill. But that was years ago when America wasn't in a recession, bricks & mortar gambling companies weren't facing bankruptcy, and Harrah's was negotiating a multi-billion dollar deal.

In fact, once UIGEA was implemented Harrah's were able to tack on an extra couple of billion dollars to their valuation, as the overseas competition were shown the door. Senator Frist retired from the senate soon after, doubtless to give him more time to fondle his money. Who here can say protectionism?

But just to show there are no hard feelings in the cutthroat gambling world Harrah's recently hired ex Party Gaming Chief Executive Officer, Mitch Gerber to head its new Harrah's Interactive Entertainment Division, who will act as CEO in his new capacity. Mitch didn't want to live his life in exile from North America so quit the Party as it would have meant jail time thanks to the company he is...now working for!

"As the world's largest gaming company, Harrah's is taking a proactive approach toward international and interactive expansion," announced the Chairman of Harrah's Entertainment, Gary Loveman, who also serves as the group's Chief Executive Officer and President. "It is important that we position ourselves to explore new markets as well as new technologies with our best in class brands."Gary could have simply said "if you can't demonize them and jail them you might as well hire them and compete with them." But we all know that the real reason these companies used to hate online gambling was for the good of the children, and because gambling (on your computer) is immoral.

Harrah's decision comes in the wake of a general downward trend in the number of gamblers who attend land based casinos in the United States. With numbers down and profits and revenues declining, it is only natural that Harrah's Entertainment, one of the greatest players in the Vegas market, seeks to expand to other markets around the world; and with the online gambling industry performing so well, this seems to be the group's obvious choice of direction.

My advice to you? Swallow your bile and buy as much Party Gaming stock on the LSE as you can. It's trading at 265p down from the glory days when it was over 1200p, you know when they still had an American market to work with, but with Harrah's now an ally they should rocket back into the black. And after all, isn't making a quick buck the real American dream come to life?

 Posted by Anonymous at 12:09 on 13 June 2009