Lawrence Vaughan, co-founder of Real Gaming, one of the two online poker sites running in Nevada, said he is bullish on the industry even though it’s gotten off to a slow start in the state.
Here’s some highlights on an interview Vaughan gave to Vegas Inc.
Did Ultimate Poker’s shutdown affect you?
It affected us in a positive way. People were like, “Where do we go?” and there are two options.
The bad thing is, when it’s the beginning of an industry and a company drops out, it looks bad. So the first thing people always say is: “Hey, how’s that industry going?”
Well, not spectacular initially, but that’s sort of the getting started. Also, the player pool is really small in Nevada. It would be good for Nevada to open more games sooner. Or we need more state compacts, which also would solve that problem if we’re sticking with just poker.
Were you expecting the industry to perform better when it launched?
I was expecting it to move faster. I didn’t expect Nevada to do tremendously well; I don’t think anyone did. Everyone was putting money into it expecting things like state compacts or a federal law to come much sooner. These other states are opening up, it’s just — as bureaucracy tends to go — slower than expected.
What’s the outlook for your company and the industry?
For us, it’s OK because there are only two sites, and we’re still in this interesting phase where we can assess the market and define what it’s going to be. What we launched with and what will be on the market at the end of the year and what will be on the market a year from then are completely different products.
How big can Nevada’s market become in terms of operators? Is two really all the state can handle right now?
In this form, two or three is the most. Probably in five years from now, I would venture to say there will be more than $100 million a year in interactive gaming revenue in this state. So the market’s big. Most people would think that’s nuts, but it’s not. It’s true.
Do you have strong feelings about the congressional effort to ban online gaming?
I think it’s counterproductive for the industry. There are a lot of people working really hard in this new space; there’s demand for it. It’s like music piracy in the late ’90s: It needed to be regulated, it needed to be brought out of the dark, and it was solved. You saw that evolve.
The demand is there; no one with any amount of money can shut that up. They can hurt the industry, but they can’t stop what customers want.
How big do you want Real Gaming to become?
Our goal is just to make sure we deliver the best product to the customers — a better product than what you can get somewhere else. Inevitably, the rest will work itself out. The No. 1 thing for us right now is product and being on the cutting edge of product.