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March 19, 2014

Geolocation Problems Persist with New Jersey Online Casinos

March 19, 2014

When online gambling became available to all players age 21 and older in New Jersey, the casino websites had to be able to verify that their players were only logging in from New Jersey, as per the rules set forth by the New Jersey Division of Gaming Enforcement. To ensure this, the state contracted third party geolocation services to do the job. This job is known as a Know Your Customer, or KYC, verification service.

The New Jersey Division of Gaming Enforcement licensed multiple geolocation services to serve gambling websites hosted in the state. Central Account Management System, or CAMS, xyVerify, GeoComply, and Locaid are all geolocation service providers who have been authorized to verify players’ locations.

To prove that they’re in New Jersey, all players must download a WiFi plug-in from the website where they’d like to play. This plug-in helps to verify their location by giving a stronger, directed signal right back to the geolocation service’s server. It is a piece of software that must be downloaded to the player’s computer before he or she can log into a casino website and play. This method of verification was chosen by the New Jersey Division of Gaming Enforcement because it is much more accurate than relying on cell phone service towers to locate players. In Nevada, approximating players’ locations through cell tower service works fine because its borders are very sparsely populated. This type of verification is accurate within about a mile’s space. In New Jersey, using this method would cause problems for thousands of players. Some of New Jersey’s most densely populated areas are along the New York and Pennsylvania borders. WiFi-based verification is accurate within feet of where the player’s signal is emitted from.

Geolocation Problems

This method is verification was accurate, but not foolproof. Within a day of legalized gambling, hundreds of New Jerseyans reported problems with geolocation. At first, this was about ten percent of people who tried to log into gambling websites in New Jersey – a large enough portion of the population that casinos’ profits would be significantly cut, as well as their reputations damaged, if they didn’t act fast.

What was happening was, even with the plug-in, some players’ WiFi signals were still too weak to reach the geolocation service providers’ servers. Others had a more difficult problem to fix – no WiFi. These players accessed the internet through hard ethernet cables, either by choice or because they were working on older machines that required an ethernet connection. These players were greeted with an error message stating that the website could not verify that they were in New Jersey, barring them from gambling online.

To fix this, large gambling websites like 888Poker.com, NJPartyPoker.com, and WSOP.com offered WiFi dongles, or adapters, to players who were having trouble logging in to play. These devices boosted, or in some cases, created, users’ WiFi signals, making previously-unreachable customers able to log onto gambling websites and play.

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Locking Out Players Means Losing Business

A happy player is a loyal customer, and the casino sites knew they needed to act quickly to retain the players who experienced problems. The cost incurred by the giveaway, approximately $10 per dongle, was insignificant compared to the amount of money they would have lost by alienating these players. Once the companies began giving WiFi dongles to players, reports of geolocation errors decreased. They haven’t completely been resolved, but currently, about 5% of players still report issues trying to verify their location and log into casino websites.

There is currently a buffer zone in place around New Jersey’s borders, which is where the 5% of locked-out players reside. The Division of Gaming Enforcement worked with geolocation providers to create this border, and is in the process of shrinking it until it is accurate down to the exact state line, allowing players on the New Jersey side of its borders to play. Since the initial geolocation problems were fixed, gambling revenues have grown and are expected to do so as the state works to eliminate the buffer zone completely, allowing all eligible New Jersey gamblers to log on and play for real money online.

More on Geolocation

Geolocation technology has changed the way we interact with and perceive our surroundings. Nobody uses a paper map to reach their destination anymore – just plug where you want to go into the GPS and a friendly voice will give you step-by-step directions to get there. It’s the technology at play when you check into a location on Facebook or Foursquare and how apps like Gasbuddy know the closest gas stations to suggest to you.

Because geolocation has made it possible for a website or mobile device to determine its user’s physical location, it also made it possible to restrict certain sites’ usage to people only within, or outside of, a specific area. Right now, online gambling is only legal within the borders of Nevada and New Jersey. To operate within the law’s parameters, gambling websites use geolocation technology to ensure that their players are within these states’ borders. If a website cannot prove that its users are within the area where it’s authorized to operate, it may not legally continue to do business.

How Does Geolocation Work?

Although it sounds simple, geolocation is actually a complicated process that is prone to flaws. Since online gambling became legal in New Jersey in 2013, some users reported problems with the websites verifying that they were, in fact, logging in from locations within New Jersey. Others reported being able to log in, only to have an error message interrupt them in the middle of a poker match, stating that the website could not verify that they were in New Jersey. To understand how these errors occurred, you need to know a bit about how geolocation technology works.

Smartphones and tablets have GPS chips inside them, which use satellite data to calculate their position on Earth. When the sky is clear, these satellite signals can reach mobile devices easily and accurately provide a user with her or her geographic location. When the weather’s less clear and the satellite signals can’t reach mobile devices as easily, tablets and phones use the signals from nearby cell phone service towers to approximate the device’s position. This is a slower, less accurate process, but is usually able to determine a device’s location fairly closely.

Laptop and desktop computers handle geolocation a little bit differently, though. When you use the internet on a computer, your browser is what determines your location. It does this by gathering information through your IP address and WiFi connection location. This is what’s happening when certain websites prompt you to share your location with your browser – it’s the browser’s way of locating you to be able to give you a more tailored experience with the site. For example, say you type “Chinese food” into a search engine without specifying where you’re located or where you’re looking to purchase this Chinese food. If you’ve shared your location information with your browser, your top search results will be the Chinese food restaurants that are closest to you. When a user consents to sharing his or her location with their browser, their location information is sent to Google Location Services, the database that stores the information used to produce search results like the Chinese food example above and useful tools like Google Maps. Mozilla, Safari, Internet Explorer and Chrome all share information with Google Location Services, helping to create a comprehensive map of the world.

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