The hotel and gaming company established , PlayMGMmirage.com in September 2001, promising that its business model would block money laundering while providing customers with the same exciting game content found in Las Vegas.
"We set out to prove that on-line casino gaming could be implemented with the same high standards of regulatory integrity as land-based operations," said Terry Lanni, CEO of MGM Mirage, yesterday.
The company took bets only from those jurisdictions where on-line wagering was permitted, meaning the doors were closed to customers from the US and other disapproving jurisdictions.
Lanni observed:
"Unfortunately, even in light of a successful working model, the legal and political climate in the US and several countries around the world remains unclear. The fact is that millions of US citizens currently participate in on-line gaming in an unregulated environment. We believe that a more sound and realistic public policy would be to regulate the activity and hold operators to the highest standards of probity and integrity."
The regulation of internet gambling is varied and politically sensitive. Some countries permit it, others do not. Some credit card companies process payments to gambling sites, others do not. Earlier this week, the US House of Representatives dropped a piece of legislation designed to stop on-line gaming by US citizens. A lobbying war has now broken out.
However, the restrictions that MGM Mirage had placed on itself may have been its undoing.
Sebastian Sinclair, president of Christensen Capital Advisers, a casino consultant company, told the International Herald Tribune that the strategy of not accepting customers from the US placed it at a disadvantage compared to unregulated sites. "They were running in a race with a big weight tied round their leg," said Sinclair.
While rival on-line casinos may benefit from MGM Mirage's withdrawal from the market, they may suffer in another way. For the brand of MGM Mirage was one of the most respected players and its leaving the table will do the industry's image few favours among the lawmakers.
