Europe Unleashes Online Gambling to Fill Coffers

Across Europe, cash-strapped governments looking for ways to reduce yawning budget gaps are embracing online gambling, a source of revenue they once viewed with wary skepticism.

While U.S. opposition to Internet betting has centered on concerns about gambling addiction, European politicians previously objected for a different reason: liberalizing the practice, they feared, would undermine state-sponsored lottery monopolies and gambling operators. But more and more gamblers are spurning land-based casinos anyway, and logging on to Internet poker and sports betting sites — many of them based in places that are out of reach of tax collectors. As public finances worsen, governments are trying to bring this once-shadowy business into the mainstream of Europe's digital economy, where it can be regulated and taxed.

"What's happened is a realization that you can't uninvent the Internet," said David Trunkfield, a consultant at PricewaterhouseCoopers. "People are gaming online. You either try to regulate and tax it, or people are going to go to the offshore operators, where you don't get any revenue."