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Delaware and Nevada team up to expand online gambling

Delaware officials hope a new partner will raise the stakes - and revenue - associated with online gaming.

Nevada Gov. Brian Sandoval (R-Nevada) joined Gov. Jack Markell (D-Delaware) in Wilmington Tuesday morning to sign a first in the nation multi-state internet gaming agreement.

Under the agreement, players will still log on to the respective online casinos in their state and be governed by their state’s gambling laws, but will be allowed to play poker against each other and compete for combined pots.

While players will benefit from a larger playing pool and potentially bigger pots, Governor Sandoval says the states will also benefit.

"The states from which the players play keep the revenue," said Sandoval. "There is an opportunity for us to have more players which makes it more attractive, but at the same time the states will exclusively benefit from this."

The agreement also establishes the Multi-State Internet Gaming Association, a newly established Delaware L.L.C., which not only regulates online play, but has the authority to add new games and rules.

Today's agreement set the legal framework. Now the states have to develop a technical platform that does what the agreement promises. No date has been set for rolling out multi-state play, but state officials suggest it could happen by the end of the year

"The good news is that we both use the same [technology] providers, so I think that is helpful," said Markell. "It's really a matter now of making sure we have agreement on what it ought to look like when they log on. Now, I think it is in everybody's interest to push as quickly as we can."

While some critics believe that this could possibly take business away from Delaware’s struggling brick and mortar casinos, Governor Markell disagrees.

“Anybody who wants to participate from Delaware actually logs on to one of the websites of the casinos," said Markell. "We are hopeful that over time it helps the casinos develop additional relationships with customers and of course they continue to offer attractive things within their physical venues as well, so we’re hopeful that it is additive.”

Currently the agreement is only between Delaware and Nevada who have less than 4 million citizens combined. However, the agreement is designed so that more states can join.

“That’s the whole point of this, to have more players and to set this example so that other states will see there is a great opportunity to join this agreement," said Sandoval. "We are two small states but we are two proud states and we are two states with that have a long record of success and I think that really sets a shining example for other states that are looking to do this.”

Sandoval admits that the process is of adding other states is still in the works. Currently, New Jersey is the only other state that has legalized online gaming, but an handful of others, including Pennsylvania, are considering it.

"For us, it worked out extremely well because we have some of the same entities that have the platforms," said Sandoval. "There are other states that are exploring this and we'll take it on a case by case basis."

Even though both states are confident that the agreement will be profitable, they say that it is too early to quantify expectations.

"This is a brand new concept," said Markell. "It certainly ought to be additive because it means that there will be more liquidity and it will be more interesting for Delaware players when there are more players to participate with but I think it is a bit premature to put a dollar figure out."