Whenever two big companies such as PokerStarsWynn.com engaged in similar business to merge, and combine their operations into a single one, it is first step to the formation of a conglomerate. It usually leads to fear among smaller companies about stifling their competitive value and eventually going into the market foe the sale of the company. Conglomerates acquire great muscle power because of their money. This muscle power is extended to the legislative field with funds for campaigning made available to senators and congressmen. This is done without any distinction of party affiliation of the persons concerned. The sole aim is to repeal laws that they consider are a drag on their business and enact new laws that will be favorable to them. Anyone opposing their steps is immediately branded socialists. President Kennedy to his Brother Robert Kennedy who was attorney general under him tried his best to break such a nexus.
The recent announcement of a partnership between two giants in the gambling field is one such measure. Wynn Resorts Ltd a leading casino operator has entered into a strategic alliance with PokerStars who are world’s biggest online poker company. the purpose of the alliance has been made very clear by Steve Wynn who is the CEO of Wynn Resorts Ltd. Online betting is illegal in the U.S.A. Steve Wynn hopes that with the muscle power by the alliance with PokerStars he will able to get legislation passed, making it quite legal in the U.S.A. The result was forth coming immediately. Legislators in Carson City have adopted a bill legalizing online poker. Whether this will be extended to other forms of online gambling is to be seen. Similarly, in Nevada, though not legalizing gambling, a relationship between two companies, one of which has branded online sites in the U.K, has been approved.
Poker Stars is a family run business (father and son), though a chief executive has been appointed recently. Mark Scheinberg, the son, has been stating that on line betting should be legalized and regulated by the Federal government. He is quoted as saying that such regulation is being done in many European countries through legislation. In an attempt to make the merger palatable to the common man who is interested in online betting, the owners of the two companies waxed eloquent of creation of thousands of jobs and millions of dollars as revenue for the government. Mark S cheinberg says European countries who have adopted these measures have benefitted greatly.
U.S. Justice Department is firmly against legalizing online gambling in the U.S.A. They have not found it easy to confront online poker companies face to face. Therefore, they have taken an indirect path trying to cripple the finances of the poker companies. In specific case money running into millions of dollars due to be paid by PokerStars and another company Fulltilt was frozen. The poker company had to look out for other sources for making payments which were due to their clients. This has been found to be a new tool to fight against illegal betting though the companies concerned have claimed that the move lacks transparency.
