The History of Online Gambling
The internet is arguably one of the top innovations in human history. Bringing instant access to information, entertainment and money making opportunities for everyone with access to a computer or mobile device, the internet has undoubtedly changed the way we live our lives.
One area of society that's benefited massively from the internet is the online gambling world. In fact, if there's one industry that's been at the forefront of the latest advances in virtual technology, it's the internet gambling world.
Although online gambling history has been somewhat checkered, the industry has still managed to thrive over the last decade and, heading into 2020, it's expected that things will continue to flourish.
The Roots of Online Gambling
The first internet gambling websites went live in the mid ‘90s. However, these were a long way away from the top platforms in operation today. Initially the best online gambling sites began operating out of Antigua and Barbuda because of the islands’ Free Trade and Processing Act. This bill gave the small Caribbean nation the right to grant licenses to those businesses interested in starting online casinos and, essentially, spawned a new industry.
Around the same time, one of the industry's largest software providers, Microgaming, was first coming to prominence. In the history of online gambling, Microgaming has become known as one of the leading lights and a company that's virtually revolutionized gambling online.
In fact, even now, Microgaming is still considered to be one of the most trusted software providers to the internet gaming industry. Their software currently supports all types of online gaming sites from casinos to poker rooms and everything in between.
Online Gambling: A Gaming Revelation
Another major development in the history of online gambling came after the Kahnawake Gaming Commission was formed in 1996. Owned and operated by a Mohawk Indian tribe based in Canada, the commission was established with the aim of issue gaming licenses.
The formation of the Kahnawake Gaming Commission coincided with the appearance of the first online gambling sites, though which site came first is up for debate. Online gambling history is often littered with inaccuracies and, while some sources suggest InterCasino was the first virtual platform, others will state that Microgaming's offering came first. GamingClub, built by Microgaming), beat them to the punch by opening in late 1995.
Following this initial birth, the online gambling industry saw huge growth. By the end of 1996 there were approximately 15 internet gambling sites in operation. Moreover, by the close of 1997 the industry had exploded and there were more than 200 online casinos, poker sites and sportsbooks available across the world with annual revenues approaching $1 billion.
Online Gambling History: The Rise of Sports Betting
The natural progression from virtual casino and poker sites was naturally to online sportsbooks. In 1996 InterTops became the first platform to offer a new way for fans to wager on their favorite teams. The initial success of InterTops was followed by rapid expansion and within two years some of the world's top bookmakers, including William Hill and Ladbrokes, had opened their own online gambling sites.
Initially, these websites gave punters huge bonuses and cash back offers as an incentive to gamble online. As the market has matured these deals have gradually decreased. However, the modern online gambling climate is still very much a Mecca for bonuses if you know where to look (and fortunately we do).
The Curious Case of Betfair
Another interesting trend in online sports betting developed in the year 2000 after Betfair entered the market. This internet gambling site took sports betting to a new level with the invention of peer-to-peer wagering. Almost unique in the industry, this system basically allowed players to make bets between themselves while the site took commission from each wager.
Two years after the formation of Betfair, in-play sports betting provided the online industry with another boom. Taking internet technology to its limits, live sports betting has proven to be immensely popular and one of the most exciting new sports wagering option on the market today thanks to its compatibility with both desktop and mobile devices.
The Rise of Online Poker
Planet Poker is generally considered to have been the first online gambling site to offer poker. Formed back in 1998, this platform quickly attracted a large number of players, including WSOP bracelet winner Chris "Jesus" Ferguson.
Unfortunately, the site was plagued by a number of technical problems and other glitches. Back in those days, a large number of people were still using dial-up internet services, which created a number of speed and downloading issues.
However, the failure of Planet Poker led to the rise of new poker sites such as Paradise Poker, partypoker and, eventually, PokerStars. Paradise was launched in 1999 from a base in Costa Rica and quickly became the biggest player in the market. Thanks to a more advanced platform than Planet Poker, Paradise was able to cram thousands of players onto its platform on a daily basis.
Partypoker and Poker Stars were formed just two years after Paradise Poker in 2001 and soon became the top two internet gambling sites in the world. In fact PokerStars is partly responsible for the global poker boom thanks to its online tournament satellites.
Chris Moneymaker famously qualified for the $10,000 WSOP Main Event after winning a $40 satellite on PokerStars. From here the amateur player managed to win the 2003 for more than $2 million and inspire a generation in the process.
Online Gambling History: Internet Gaming and UIGEA
Although online poker was hugely popular in the United States, Congressional lawmakers decided to pull the rug out from under players in 1996. Despite the industry's popularity, US politicians passed the Unlawful Internet Gaming Enforcement Act (UIGEA) which basically made it illegal to deposit and withdraw funds to and from an online gambling site. This move led to a huge amount of confusion regarding the legality of not only internet poker, but also online gambling within the US in general. Many poker and other online gambling sites were forced to shut down or else close their doors to US players.
The really interesting thing about the UIGEA is the fact that it didn't actually make gambling online illegal. Instead, it attacked the payment processing companies, making it illegal to process payments for gambling activities for anyone residing in the US. Unfortunately, this led to a lot of confusion and many sites and online gambling businesses saw this as a big gray area. Many of the major sites decided to stop doing business with US customers, devastating their revenues in a number of cases.
Several sites did try to stick it out and continued accepting US players. These sites included PokerStars, Full Tilt Poker and Absolute Poker. Sadly, in 2011, the US government cracked down and seized their websites, essentially shutting these three (and other) companies down to anyone residing in the US. This event became known as 'Black Friday' in the online poker community.
Although legal online poker is still a gray area in the US, there is some hope for the future. A number of legislators have begun attempting to reinterpret the legal foundations upon which the UIGEA was based. This has led to several US States, including New Jersey, Nevada and Delaware, to allow online poker again, although with additional regulations. There are also a number of other States that are looking into and / or thinking about allowing online poker, attracted by the revenue it might bring to sagging state coffers.
Online Poker's Future
Although online gambling, especially online poker, has had its ups and its downs over the years, there is renewed hope for the future. Europe has already recognized internet gambling as the right of every legal adult and it seems as if the US is starting to adopt the same mindset. In fact, the top online gambling sites are now working hard to lobby US politicians and many are predicting that the coming years could see a renewed boom for the virtual gambling industry.