South Point Puts It On (the) Line

On Aug. 23, the Nevada Gaming Commission approved the South Point’s application to run a legal online poker room—the first Nevada casino to be granted such a license. We are on the cusp of writing history. So what’s really going on with the operation, which will probably start accepting real money bets on poker before Halloween?

First off, South Point Poker LLC is administratively distinct from the South Point. Its chief operating officer, Lawrence Vaughan, is a young veteran of the Web, having launched the job search site in 2008.

A Las Vegas native, Vaughan says he’s “always been into software and tech,” and saw the possibilities for poker on the Internet. “Knowing the implications of where this is going in the next few decades, that’s the exciting part,” he says. “It’s going to be a hell of a lot different.”

Vaughan started working on an online poker platform in 2010. The following year, mutual friends introduced him to South Point owner Michael Gaughan. Less than 24 hours later, they had a deal signed.

Last October, the South Point launched a free-play poker-room on the Zen Entertainment Network, but that’s more of a cul de sac than an onramp to “real” online poker; it gets real when there’s real money involved. (Once the pay site goes live, it will handle free play as well, and the current platform will go away.)

Early on, Vaughan decided to create his own software instead of partnering with an existing supplier.

“For the most part,” Vaughan explains, “most of the suppliers out there have software that’s 5 to 10 years old. We looked at it. I thought, ‘Why start with stuff that’s out of date?’ Some of the tech that’s being pitched is stupidly out of date—it’s mind-boggling. So [we] build it from scratch. We know the regulations, and we built the platform specifically to comply with them.”

True to his roots as a code-writing programmer, he’s proudest of the work his team has done to make something complex look simple.

“It’s a massive project, but it doesn’t look that way from the user’s perspective,” he says. “It’s easy to get access and start playing.”

Right now, South Point Poker has about 30 employees. Many are techies—coders, mostly—but there are also compliance officers, accountants, marketing guys and investigators. Thirty might not seem like a huge number—the average Las Vegas casino employs three times that many people in its beverage department alone—but it could be the wave of the future, as many are hopeful that Las Vegas becomes the world’s center for online gambling operators, even as visitors spend less money gambling while they’re in town.

That future’s going to start … soon. The software is on its second pass through an independent testing lab. As with much of gaming regulation, testing is a process that is more about getting it right than meeting a timeline, so it’s difficult to say how long it will be before the lab and the state give the OK to flip the switch. Vaughan is hopeful that the real-money site will go live in October.

Once that happens, players can open accounts and start playing for keeps. In the sign-up, they’ll be asked for a range of information, including their full name and Social Security number, and be asked to upload photos of their government-issued identification. There will be limits on who’s allowed to play: Players must be over 21 and reside in the state of Nevada; in addition, the site will maintain its own exclusion list, with names of people who have voluntarily banned themselves and those whom the company or gaming regulators do not want playing. South Point’s investigators will then vet the application. Most players will be approved within 30 minutes, with those who are declined seeing their deposits returned.

Betting will start at relatively low levels—50-cent/$1 or even 25-cent/50-cent tables—and the market will set the limit for higher-stakes games.

In keeping with the regulations, South Point has a dispute-resolution system should a player take issue with any aspect of game play or the site. South Point will have customer-service representatives on duty around the clock to take initial complaints, and its own internal investigation division standing by to probe deeper into cases with no easy resolution. If a player doesn’t feel he’s gotten justice, Nevada Gaming Control Board investigators will then look into the case.

Will online poker 2.0 (Nevada edition) succeed? That remains to be seen, but with so much riding on the outcome, it is clear that neither Vaughan nor regulators will be leaving much to chance.