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It has been partly responsible for a huge increase in the number of poker players worldwide. Also, brick and mortar casinos are reluctant to promote poker because it is difficult for them to profit from it.

Though the rake , or time charge, of traditional casinos is often high, the opportunity costs of running a poker room are even higher.

Online venues, by contrast, are dramatically cheaper because they have much smaller overhead costs. For example, adding another table does not take up valuable space like it would for a brick and mortar casino.

Online venues may be more vulnerable to certain types of fraud , especially collusion between players.

However, they have collusion detection abilities that do not exist in brick and mortar casinos.

For example, online poker room security employees can look at the hand history of the cards previously played by any player on the site, making patterns of behavior easier to detect than in a casino where colluding players can simply fold their hands without anyone ever knowing the strength of their holding.

Online poker rooms also check players' IP addresses in order to prevent players at the same household or at known open proxy servers from playing on the same tables.

Digital device fingerprinting also allows poker sites to recognize and block players who create new accounts in attempts to circumvent prior account bans, restrictions and closures.

Free poker online was played as early as the late s in the form of IRC poker. Planet Poker was the first online card room to offer real money games in The first real money poker game was dealt on January 1, The major online poker sites offer varying features to entice new players.

One common feature is to offer tournaments called satellites by which the winners gain entry to real-life poker tournaments.

He went on to win the main event, causing shock in the poker world, and beginning the poker boom. The World Series featured three times as many players as in At least four players in the WSOP final table won their entry through an online cardroom.

In October , Sportingbet , at the time the world's largest publicly traded online gaming company SBT. L , announced the acquisition of ParadisePoker.

Since then, several other card room parent companies have gone public. In early , PartyGaming moved to acquire EmpirePoker. Later in the year, bwin , an Austrian-based online gambling company, acquired PokerRoom.

Other poker rooms such as PokerStars that were rumored to be exploring initial public offerings have postponed them. As of March , there are fewer than forty stand-alone cardrooms and poker networks with detectable levels of traffic.

There are however more than independent doorways or 'skins' into the group of network sites. As of February , there are approximately online poker websites.

The year is known as the infamous year of Black Friday, when the U. From a legal perspective, online poker may differ in some ways from online casino gambling.

However, many of the same issues do apply. For a discussion of the legality of online gambling in general, see online gambling. Online poker is legal and regulated in many countries including several nations in and around the Caribbean Sea , and most notably the United Kingdom.

In the United States, the North Dakota House of Representatives passed a bill in February to legalize and regulate online poker and online poker card room operators in the state.

The legislation required that online poker operations would have to physically locate their entire operations in the state. The measure, however, was defeated by the State Senate in March after the U.

Department of Justice sent a letter to North Dakota attorney general Wayne Stenehjem stating that online gaming "may" be illegal, and that the pending legislation "might" violate the federal Wire Act.

However, many legal experts dispute the DOJ's claim. In response to this and other claims by the DOJ regarding the legality of online poker, many of the major online poker sites stopped advertising their "dot-com" sites in American media.

Instead, they created "dot-net" sites that are virtually identical but offer no real money wagering. The sites advertise as poker schools or ways to learn the game for free, and feature words to the effect of "this is not a gambling website.

According to the UIGEA, "unlawful internet gambling" means to place, receive, or otherwise knowingly transmit a bet or wager by means of the internet where such bet is unlawful under any law in the State in which the bet is initiated, received, or otherwise made.

As a result of the bill, several large publicly traded poker gaming sites such as PartyPoker , PacificPoker and bwin closed down their US facing operations.

Part of the PPA's mission is to protect and to advocate for the right of poker players to play online. D'Amato's responsibilities include Congressional lobbying.

In April , the PPA claimed over 1,, members. Other grassroots organizations, including the Safe and Secure Internet Gambling Initiative , have formed in opposition to UIGEA, to promote the freedom of individuals to gamble online with the proper safeguards to protect consumers and ensure the integrity of financial transactions.

The move blocks regulations to implement the legislation which requires the financial services sector to comply with ambiguous and burdensome rules in an attempt to prevent unlawful Internet gambling transactions.

The bill would legalize and regulate online poker in the United States. In September , the Washington State Supreme Court upheld a law making playing poker online a felony.

On April 15, , in U. A grand jury charged 11 defendants, including the founders of the poker sites, with bank fraud, money laundering, and violating gambling laws.

The prosecutors claim the individuals tricked or influenced U. He asserts that, "Online poker is not a crime and should not be treated as such.

On September 20, , in response to guidance requested by the states of Illinois and New York regarding the sale of lottery tickets online, the Department of Justice issued a memorandum opinion stating that the Wire Act does not prohibit lottery sales over the internet because it deals solely with wagering on sporting contests.

While this opinion does not address online poker specifically, the reasoning employed interprets the Wire Act in such a way that its provisions don't apply to the game of poker.

On August 21, , a federal judge in New York ruled that poker is not gambling under federal law because it is primarily a game of skill, not chance.

The ruling resulted in the dismissal of a federal criminal indictment against a man convicted of conspiring to operate an illegal underground poker club.

The judge relied in his decision largely on findings by a defense expert who analyzed Internet poker games.

On April 30, , Nevada became the first U. In late October, Delaware launched its regulated online gambling market. Controlled by the Delaware Lottery, the state offers online casino games in addition to online poker.

On November 21, , New Jersey became the third - and the largest state population-wise - to offer legal real money online gambling to residents and visitors.

The industry in the Garden State launched in "soft launch" mode on November 21 with a full-scale launch occurring five days later on November 26, On February 25, , Nevada Governor Brian Sandoval and Delaware Governor Jack Markell signed the first interstate poker compact, an agreement that will allow online poker players from Nevada to play for real money against players located in Delaware.

The compact is limited to online poker only, as that is the only game currently permitted under Nevada law. Should more states enter into the agreement, something that is provided for under the terms of the compact, more games could be offered.

Following an agreement between Nevada, Delaware, and New Jersey governments to allow player pooling between all three states, a 3-state online poker compact went live on May 1, Typically, online poker rooms generate the bulk of their revenue via four methods.

First, there is the rake. Similar to the vig paid to a bookie , the rake is a fee paid to the house for hosting the game.

Rake is collected from most real money ring game pots. The rake is normally calculated as a percentage of the pot based on a sliding scale and capped at some maximum fee.

Each online poker room determines its own rake structure. Since the expenses for running an online poker table are smaller than those for running a live poker table, rake in most online poker rooms is much smaller than its brick and mortar counterpart.

Second, hands played in pre-scheduled multi-table and impromptu sit-and-go tournaments are not raked, but rather an entry fee around five to ten percent of the tournament buy-in is added to the entry cost of the tournament.

These two are usually specified in the tournament details as, e. Unlike real casino tournaments, online tournaments do not deduct dealer tips and other expenses from the prize pool.

Third, some online poker sites also offer side games like blackjack , roulettes , or side bets on poker hands where the player plays against "the house" for real money.

Some sites go as far as getting affiliated with online casinos , or even integrating them into the poker room software. Fourth, like almost all institutions that hold money, online poker sites invest the money that players deposit.

Regulations in most jurisdictions exist in an effort to limit the sort of risks sites can take with their clients' money.

However, since the sites do not have to pay interest on players' bankrolls even low-risk investments can be a significant source of revenue.

Many critics question whether the operators of such games - especially those located in jurisdictions separate from most of their players - might be engaging in fraud themselves.

Internet discussion forums are rife with allegations of non-random card dealing, possibly to favour house-employed players or " bots " poker-playing software disguised as a human opponent , or to give multiple players good hands thus increasing the bets and the rake, or simply to prevent new players from losing so quickly that they become discouraged.

However, despite anecdotal evidence to support such claims, others argue that the rake is sufficiently large that such abuses would be unnecessary and foolish.

Attempts at manipulative dealing could face a risk of third party detection due to increasingly sophisticated tracking software that could be used to detect any number of unusual patterns, though such analyses are not generally available in the public domain.

Many players claim to see lots of "bad beats" with large hands pitted against others all too often at a rate that seems to be a lot more common than in live games.

However, this could be caused by the higher hands per hour at on-line cardrooms. Since online players get to see more hands, their likelihood of seeing more improbable bad beats or randomly large pots is similarly increased.

Many online poker sites are certified by major auditing firms like PricewaterhouseCoopers to review the fairness of the random number generator , shuffle , and payouts for some sites.

Insider cheating can occur when a person with trusted access to the system e. This could be done without the knowledge of the site managers.

Perhaps the first known major case came to light in October , when Absolute Poker acknowledged that its integrity had been breached by an employee, who had been able to play at high stakes while viewing his opponents' hidden "hole" cards.

In , UltimateBet became embroiled in a similar scandal, with former employees accused of using a software backdoor to see opponents' cards.

UltimateBet confirmed the allegations on May More mundane cheating involves collusion between players, or the use of multiple accounts by a single player.

Collusion is not limited to online play but can occur in any poker game with three or more players. So what are you waiting for?

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