Google and Yahoo, two of the most popular Internet search engines, will stop running ads for online casinos by the end of April, the New York Times reported. The new policy could significantly alter the future of online gambling.
The new policies are bound up with initiatives by the U.S. Justice Department to crack down on American companies doing business with overseas Internet casinos, the Times reported.
Federal prosecutors contend that American media outlets who run ads for such casinos are “aiding and abetting” their operations, which are illegal in the United States. Prosecutors issued subpoenas last year to companies that ran ads for online casinos.
Both Google and Yahoo declined to tell the Times if they were subpoenaed, but they did confirm that they would stop accepting advertising for online casinos.
A wrinkle in the policy is that Yahoo will ban such ads only on its American version; the popular search engine has versions for dozens of countries, and Yahoo foreign versions will continue to accept the ads. Google indicated it will prohibit online gambling ads on all of its versions, foreign or domestic.
Google spokesman David Krane said the company is changing its policy to “reflect the growth of our company and ensure we provide the best search experience for our users and advertisers,” according to the Times.
The Federal Trade Commission found, in an informal survey of Web sites conducted in 2002, that minors were exposed to ads for online gambling.
“Here’s what we learned,” the FTC said in a press release. “Online gambling and kids is a bad bet.”
As online gambling has become more popular and profitable in recent years, the U.S. government has sought ways of curbing the practice, which is illegal in the United States. Most of the online gambling sites are headquartered offshore, in places like Costa Rica and Antigua. Their physical location is virtually unimportant, however, given the worldwide nature of the Internet.
“Technology has all but trumped federal and state law,” wrote Kevin McCoy in a 2002 USAToday.com story about the popularity of online sports betting.
A Wired magazine article from 2002 echoed McCoy’s sentiment.
“Trying to prevent U.S. Internet users from accessing offshore gambling sites is basically hopeless and largely a waste of time,” the story read.
At the time, legislators were trying to deal with Internet gambling by focusing on financial institutions that accepted payments for online gambling, trying to make such transactions illegal.
Now, however, the federal government is using the “aiding and abetting” strategy to combat online gambling. Not everyone, of course, is pleased with the new policy.
“I urge these search engines and other service providers to stand up for themselves and challenge these pressure tactics by federal prosecutors,” David Carruthers, CEO of BetonSports.com, told the Times.
BetonSports.com, based in Costa Rica, is a portal for online gambling and sports betting. More than 30 million bets were placed last year by North American users—most of whom were U.S. residents, the Times reported.
While some legal experts believe that American companies are within their rights to accept ads for online casinos, large media companies seem to be acquiescing to the Justice Department’s demands. Even radio broadcasting behemoths like Clear Channel and Infinity are turning down ads for online gambling, the Times reported.
Dakota Sullivan, vice president for marketing at LookSmart, a search engine based in San Francisco, told the Times, “There’s been a general message sent to publishers from various agencies in the government that the legality of this advertising is unclear.”
“There’s been a general shift in the atmosphere,” he told the Times. “There’s a question of whether it’s legal, and, beyond that, whether it’s right.”
Questions of legality and morality are sure to remain.
“It might be argued that there’s no need for these kinds of laws,” the Wired story read. “If people want to engage in the inherently losing proposition that is gambling, let them dig their own financial graves. You can’t legislate against stupidity.”
“On the other hand,” it continued, “there are distinct consumer-protection aspects to this issue. Gambling addiction, like alcoholism, is widely recognized as a disease, and the potential for unscrupulous Internet gambling operators to fleece the vulnerable is very high, more so than in most non-Net gambling situations.”
BetonSports.com has a “responsible gaming” page on its Web site.
“For most individuals, gambling is a recreational form of entertainment,” the page says. “However, for those that may seek support and guidance, we have listed some organizations below that may be contacted for assistance.”
The page includes logos and links to gambling addiction help centers like Gamblers Anonymous and the Responsible Gambling Council.
Cliff Vaughn is culture editor for EthicsDaily.com.