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Wynn and PokerStars Announce Alliance

Last Thursday it was announced that PokerStars and Wynn Resorts were forming a strategic alliance joining the power of the brick and mortar casino with the largest online poker site in the world. One of the first goals of his merger is to seek passage of federal legislation that will regulate Internet gambling.

"We are convinced that the lack of regulation of Internet gaming within the US must change,” Steve Wynn, chief executive officer of Wynn Resorts, said in a statement. “We must recognize that this activity is occurring and that law enforcement does not have the tools to stop it.... It is time that the thousands of jobs created by this business and the potentially significant tax dollars come home to the U.S."

The ultimate plan for the new alliance is to create a joint venture between the two companies, called, that will provide online poker in the U.S. This ia a bold new direction for the Vegas-based casinos which had, until recently, looked at online poker as their sworn enemy and had worked hard to thwart efforts to legalize and regulate internet poker in the U.S.

Now it appears that the big brick and mortar casinos are changing their strategy and now looking for ways that they can run their own online poker rooms, if U.S. lawmakers finally pass legislation to overturn the UIGEA.

The announcement of this new alliance came on the heels of the unprecedented approval by Nevada regulators of a marketing agreement between Caesars Entertainment and 888 Holdings PLC, a Gibraltar-based company that offers online poker overseas. This was the first time the Nevada Gaming Commission had explicitly allowed a casino operator to do significant business with a foreign company that offers gambling on the Internet.

Perhaps the brick and mortar casinos, recognizing that online poker is here to stay, are taking the "if you can't beat them, join them," path of least resistance. It will be interesting to see if removing one of the major obstacles to the legalization and regulation of online poker -- opposition by the deep-pocketed casinos -- will give pending legislation in Congress to overturn the UIGEA the boost it needs.

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