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Who controls the 'Net?
By Scott Bradner
From what I read, being addicted to gambling is not a cheap date. What I have seen in Las Vegas confirms this. If billion dollar hotels can be paid off in a few years using just the house part of the cash flow there has to be a lot of money in this picture. In the future fewer of the hotels might be needed because their patrons can telecommute.
Internet gambling is a big deal and getting bigger in spite of the efforts of a lot of people to squash it. While gambling proponents (for example Roy Cooke http://www.cardplayer.com/poker_magazine/archives/showarticle.php?a_id=14867&m_id=65568) claim that there are no federal laws that specifically outlaw Internet gambling but the US Justice Department says that the 1961 Wire Act (http://caselaw.lp.findlaw.com/casecode/uscodes/18/parts/i/chapters/50/sections/section_1084.html) applies to the Internet and outlaws Internet gambling . Not everyone agrees (see http://www.gambling-law-us.com/Federal-Laws/wire-act.htm).
But this column is not about the legality or illegality of Internet gambling in the US. Nor is it about the impact of gambling on tax revenues or society. It is about a funny battle the US has gotten into with a miniscule Caribbean nation over Internet gambling and the implications of the precedent that this battle may create.
Antigua and Barbuda (http://www.antigua-barbuda.org/), a nation comprised of a pair of Caribbean islands with a combined area about 2.5 times that of Washington DC and a population of about 68,000 decided a while back to invest in Internet casinos as a way to augment the tourist trade. Imagine their annoyance when the US government tried to prohibit US residents from partaking of their "gambling and betting services." Antigua and Barbuda did what any law-abiding country should do in cases like this, the appealed to the World Trade Organization (WTO) (http://www.wto.int/). The WTO is in the trade dispute resolution business. The WTO in April that the US could not just outlaw access to Internet gambling (http://www.wto.int/english/tratop_e/dispu_e/cases_e/ds285_e.htm) and in mid August ruled that the US has until next April to mend their ways. (http://www.wto.int/English/tratop_e/dispu_e/285arb_13_e.pdf).
The WTO basically said that the US could not block US residents from using Internet-based companies offering what was a perfectly legal service in the service provider's own country. There are some exceptions but the WTO said that Internet gambling was not one of those.
This ruling establishes that the US cannot unilaterally control what people can use the Internet for, even US residents using the Internet from within the US. This is certainly not going to go over well with those people in the government or Congress that think the US should own the Internet because "we built it."
In this case the US told the WTO that they would comply with the WTO ruling but would not "ask Congress to weaken US restrictions on Internet gambling". Seems to be a tricky balance to me.
It's not just the WTO that is telling the US that it cannot control the 'Net by itself. The final report of the UN's Working Group on Internet Governance (WGIG) (http://www.wgig.org/) does the same. This report will now go to the World Summit on the Information Society (http://www.itu.int/wsis/) later this year, which is likely to do the same. The next few months will be interesting ones on the Internet governance front and I expect to return to the topic from time to time in the future.
disclaimer: There are multiple groups at Harvard who deeply ponder Internet governance issues but the above observation is my own.