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Online Gambling Sites Allege Google And Yahoo! Are Caving To Feds
Only weeks after the World Trade Organization (WTO)
ruled in favor of protecting the online gambling industry, the industry
took a hit via Google and Yahoo!’s decisions to eliminate gambling ads
from their networks. Some online gambling providers blame the U.S.
Department of Justice (DOJ) for meddling in the matter and putting undue
pressure on media companies as part of an anti-gambling effort.
On March 24, the WTO, in a complaint by the island of Antigua and
Barbuda against the United States, ruled that any U.S. legislation that
criminalizes online wagering is in violation of global trade pacts.
While the WTO’s final ruling on the matter will not be issued until
May, it seemed that online gambling was receiving some much-needed
However, an April 2 announcement by Google and Yahoo’s! Overture that
the power brands will remove all gambling advertising by the end of this
month may indicate that the DOJ is attempting to exert pressure on
Google and Overture to steer clear of accepting the ads.
"The one thing we want to find out is whether this [decision] is
coming from government pressure," said Haden Ware, managing director of
World Wide Sports Exchange, an online gambling site.
"I can draw no other conclusion than that," said David Carruthers,
chief executive officer of BetonSports.com. In fact, according to
Michael Kulstad, a spokesperson for the Justice Department, letters were
recently issued to all major media companies reminding them that
Internet gambling is a violation of federal law. "There is concern that
gambling advertising may create the impression among the public that
these activities are legal, when in fact they are not," Kulstad said.
"It’s an ‘aiding and abetting’ sort of thing," he added.
Not surprisingly, online gambling providers see the matter
differently: "They have said it’s about ‘aiding and abetting,’" said
World Wide Sports Exchange’s Ware. "We find that to be outrageous."
BetonSports.com’s Carruthers puts in even more strongly: "I think
this flies in the face of the long tradition of commercial free speech
in America. This is a misplaced, misguided tactic."
The Justice Department’s Kulstad declined to comment on any pending
Carruthers maintains that the Justice Department’s actions reek of
desperation. "It’s like a boxer who knows he is going to lose on
points," he said. "He has to throw a curve ball."
Yahoo!, while citing a business reason behind its decision, has
implied that the current market is too risky to continue to carry
gambling advertising. "There are two things going on here," said
Jennifer Stephens, senior director of communications, Yahoo!’s Overture
Services. "Number one, we’re looking for consistency in the Yahoo!
product, and there is a lack of clarity in the environment," she said.
Yahoo! removed all casino-related banner ads in 2002–however, Overture,
which Yahoo! acquired last year, had still accepted such ads.
Google cited a desire to improve user experience by eliminating
online gambling ads from its network. "This change was made as a part of
Google’s ongoing commitment to enhancing our advertising policies to
ensure that we provide the best search and advertising experience to our
users," said David Krane, director of corporate communications.
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