Online gambling seems inevitable

DES MOINES - Placing virtual bets with actual cash is going to be a big part Iowa's gaming future, no matter what happens with the current proposal to allow Internet gambling.

It's been two decades since the first riverboats left their docks for state-sanctioned gaming excursions on the Mississippi River. Now, the casinos are permanently docked or on land all together. The number of licenses has grown from five to nearly 20, wagering limits have been lifted and legalized gaming has sprouted in neighboring states such as Illinois and Missouri

Present for almost all of it has been Jack Ketterer, the state's Racing and Gaming Commission administrator. Ketterer was the first person to hold the job when it was created in 1983. Except for a period between 1988 and 1993, he's kept that job.

That gives Ketterer, now 63, a unique perspective on how gaming has developed and likely will develop over the next two decades in Iowa.

“When you look at how the Internet is pervading society in all industries, I think that it's foolish not to monitor what's going on in that arena,” he said. “As Internet gambling is legalized, there will be a rush by large, publicly traded companies in the U.S. to participate in the online aspect. I think they will still have their bricks-and-mortar buildings in some places but will offer online as well.”

Different from expected

With New Jersey Gov. Chris Christie's veto of Internet gaming legislation in that state, Iowa is poised to become the first to allow legal online gambling.

And if not Iowa, then the Legislature of another state will. Or it might be the U.S. Congress that moves first to legalize it for the whole country.

It seems inevitable.

Twenty years ago, it was unimaginable.

“It was a slow process to get it started, but it has changed in ways I didn't think of,” said Sen. Wally Horn, D-Cedar Rapids.

In the early 1990s, Horn shepherded the gaming legislation through the Senate.

“I think it's done what we wanted it to do,” Horn said. “When it started, the focus was being family-friendly. The boat employees had to wear period costumes, but it evolved to the point where you see what we have today.”

Rep. Patrick Murphy, D-Dubuque, was a House member in his early 30s when gaming first passed. The former House Speaker thinks gaming was a boon for the river city he represents.

“In those 20 years, it brought in a hotel, a water park, a convention center,” Murphy said. “I would hate to see what Dubuque would be like without it.”

Nowadays, vocal opponents of gambling are harder to find than they once were.

“That train has left the station, and we have gambling … I think most (gambling opponents) recognize that,” Ketterer said. “Most people have recognized that the revenue to the state, the jobs that it's created and the other economic development through the amenities it has brought. They see those positive things.”

Murphy and Horn agree that gaming has helped the economy. Where they differ is how much more gambling there should be. Horn said there's plenty of demand for more licenses. Murphy, with two casinos in his home district, said if gaming hasn't reached its saturation point yet, “it's pretty close to it.”

Virtual casino

In 20 years, however, the need to actually go somewhere to gamble might seem as much as a throwback as needing to stay within a cord's length when talking on the phone seems today.

Ketterer thinks the only real question now is if states move first with Internet gambling or if it's the federal government.

“The companies out there, the MGMs and the Harrahs of the world, I think they would jump right in with very elaborate websites with virtual casinos,” he said. “Some of the providers … they would rather see a federal bill legalizing interstate wagering, so they can dominate the market with the number of properties they have, and then they wouldn't have to deal with each state.”

He thinks casinos can continue to run even as Internet gambling takes hold. Tracks, however, which already are under pressure to compete for gambling dollars, won't fare as well.

“Horse racing has suffered a decline in attendance and popularity over the years, and I think some of that has to do with the expansion of casino gambling,” he said. “Some of the glory years were when it had the monopoly on legalized gambling, that's not the case anymore.”

Ketterer guesses that in 20 years, the number of tracks in the country will be halved. Which ones will make it and which ones won't, he's not sure.

“Many of the tracks are only in existence because they are subsidized by casino revenues,” he said. “Clearly, there's too much horse racing in the United States.”

Ultimately, it won't be horses, the Internet or competition from other states that determines the future of Iowa's casinos. It will be all of them and a myriad of other entities that battle for the consumer entertainment dollar.

“It will be basically what the market dictates,” Ketterer said.

By Mike Wiser