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World Poker Tour Bets on Web Gambling

"They were never going to make a ton of money producing World Poker Tour shows and selling those," says Clinton Morrison, an analyst with Feltl & Co. "That was really an effort to establish a presence in a valuable brand. The place to really leverage that brand is in the online market."

One issue WPT faces with its new online site is that the company will not accept bets from U.S. gamblers because of the murky legality. The U.S. Justice Department has said that online gambling is illegal in the U.S. Some companies dispute this notion, but WPT isn't taking any chances. Neither is Playboy (PLA), which recently announced it would launch an online gambling room but not allow U.S.-based play.

Estimates from analysts and online gambling companies say about 50% of online gaming bets come from U.S. consumers.

Thus, in essence, WPT's new Web site is missing out on half of the total market. But if the company can get just a small piece of that market, the growth could be impressive, proponents of the stock say.

Last year, the online gaming market made $13 billion, according to Global Betting and Gaming Consultants. Assuming half of that originates from the U.S., that leaves about $6.5 billion that WPT could capture.

"Everyone believes that the biggest growth opportunities are in the international market," says Steve Lipscomb, founder and CEO of WPT Enterprises. "The market is very ripe for branded sites to have a significant piece of the market."

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