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How To Start Your Own Online Casino & Poker Room Gaming Business (Page 1 of 2)
Date: June 7, 2007
Dear Entrepreneur,
Did you know that online gambling business is currently one of the fastest growing business categories in the world? In fact, the gambling industry in the United States alone generates more annual revenues, than the Hollywood movie industry, music industry and video game industry sales combined! Americans spend over $54 billion on gambling annually. The popularity of online gaming is increasing rapidly and this year has seen significant growth in Europe and Asia. In China and Malaysia, there are twice as many online gamers as there are Internet shoppers. Around 43% of Chinese Internet users play games online, while just 16% report that they shop online.
Revenues in online gaming business rose from only $800 million to over $2 billion in 1999! By year 2006, it is estimated that online gambling industry will top over $14 billion in revenues! London-based Merrill Lynch analyst Andrew Burnett says online gambling could generate more than $150 billion in revenues by 2015. The potential of online gaming business is too big to ignore. Now is the perfect time to get onboard.
Until recently small entrepreneurs had no chance of getting into the gambling industry, because of huge capital investments, gaming license acquisitions and legal red tape. The internet eliminated all the obstacles. You can now own and promote your own online casino, sportsbook and multiplayer poker room gaming business and generate revenues you’ve only dreamt about.
There are 3 ways to start an online gaming business:
1) Most Expensive – Design and implement all gaming software for an online casino, sportsbook and multiplayer poker room which could cost you millions of US Dollars. You will also need to obtain a gaming license to run your online gaming business, which requires approval from most governments. However, you will have full control of your gaming site, and full knowledge of the source code of your gaming software. In addition, no royalties are paid out to a gaming software development company.
2) Average – Become a Licensee of an Online Gambling Software Provider. This is a far less expensive option and the client receives all the gambling software and sometimes even the equipment necessary. It is also the most popular option for both licensed land-based establishments as well as entrepreneurs. Costs range from $30,000 to $350,000. The average licensing fees are around $150,000 (this usually includes marketing costs). In most cases a royalty is paid to the gaming software provider as a percentage of the monthly “take” or “drop” (gross profit). Usually the gaming software provider has payment processing (merchant account providers) already set up for a fully turnkey operation.
3) Most Affordable – Become a Sublicensee of an existing Licensee. This is the least expensive option to start an online gaming business. Costs range from $5,000 to $60,000. The sublicensee is responsible for all the marketing and receives a smaller percentage than a full licensee (2), because royalties paid to the licensee are much higher.
Online Popularity, Internet Fraud And The E-Gaming Provider
The e-gaming market is worth billions and whats more, the returns from this global market are growing all the time. The e-gaming provider today has a great opportunity to construct a profitable business and generate revenue for profit and for good causes. However, with a great opportunity comes some risk. The e-gaming provider does have to consider the growing problem of internet fraud. As the online gaming industry grows, so too will the market for criminals and fraudsters.
The online gaming market is worth more than $15 billion and millions of people around the world spend many hours playing every day. The popularity of e-gaming is divided pretty evenly between the genders. Both women and men take part in online games and gaming.
Online poker is one of the most popular e-gaming experiences. Players compete against each other in Texas hold ’em, seven-card stud and Omaha and the games are commonly offered as tournaments and as ring games. Players can play for free while they develop their skills but to win money they need to pay tournament fees or pay-to-play each game.
Another popular e-gaming activity is the online casino, where a number of traditional casino games such as roulette and blackjack are offered from individuals computers. Players also bet on sports online, from football and soccer to horse racing and hockey. Players have a variety of ways and reasons to bet on the Internet. Online lotteries are popular outflows from government-run lottery programs and provide customers with another way to play.
Betting takes place by credit card and winnings have typically been paid to the credit card or by wire transfer. However, regulations prohibiting players from using US credit cards for online gaming restrict this method of winning money. Many authorities are concerned about unsupervised electronic transfers that could be a cover for money laundering operations. Fraud is also a problem with criminals hacking into individuals accounts for the purpose of removing money, gaining access to personal details such as credit card numbers, and making unauthorized transactions with the details.
An increasing number of people now play on their cell phone or mobile devices. This development in the e-gaming industry is making more games available and enabling people to play in different ways. As the industry develops, phone and mobile devices could provide the main means of e-gaming for many people. There is a need to create extremely secure online gaming platforms, to protect users from the negative side of e-gaming. When customers are assured that their financial and personal details are safe, however they access the e-gaming site, they can pay and play with more confidence.
Genera Networks provides products, services and technology to the global lottery industry. Genera Networks acts for the e-gaming provider to provide information and advice on developing a better business. Find out more at http://generanetworks.com/