Probably the most contentious issue facing the gaming industry today is internet gambling. For the last 10 years, offshore companies operating illegally in the United States have earned millions, if not billions, of dollars from players anxious to enjoy poker on the internet. We’re now at the point where governments realize it can’t be prevented so it’s time to regulate, tax and control it.

This realization has put tribes between a rock and a hard place. Some tribal governments believe internet gambling threatens their land-based casino operations. Others see the same opportunity that commercial casino companies envision. If players are going to gamble at home, they can parlay their bricks-and-mortar operations into that home-based play, retaining player loyalty—and revenue.

Complicating this quandary is the lack of a federal bill legalizing online gaming (actually, online poker, since the consensus seems to be that full online gaming would not pass in any form). Hearings before Congress have emphasized that tribes must have a role in any legal online poker industry, and the members of Congress seem to agree. But in this election year, the possibility of passing any controversial bill seems slim to none.

So, it’s left to the states to legalize intrastate online gaming/poker. Where, then, does that leave the tribes?

One of the biggest hurdles for tribal participation in online gambling is the insistence that it not impact tribal sovereignty by forcing the tribes to pay taxes on their online revenues. This is a violation of the principle that one government cannot tax another. But if commercial casinos are going to be taxed on their revenue, how do you not tax tribes that are participating in the identical activity?

Companies like Hard Rock International, owned by the Seminoles, are taxed like any other company on their profits. They enjoy no special shield against lawsuits in state or federal courts or tax increases implemented by those governments. Or how about the Mohegan Sun Casino at Pocono Downs in Pennsylvania? That facility is owned by the Mohegan tribe, but pays gaming and corporate taxes to Pennsylvania like any other casino there. So if these examples don’t threaten tribal sovereignty, why would a tribal internet gambling operation paying taxes to a government be a problem?

Tribes will have to make a determination very soon whether they want to participate in a legal online gaming industry. If so, there are other concerns.

First, is internet gambling covered by the Indian Gaming Regulatory Act of 1988? Most experts say it is not, which would require an amendment or two to IGRA. But tribes have long been resistant to amending IGRA for fear it would open a door they want to remain closed.

Second, if internet gaming is licensed by the state where the tribe is located, would you need to renegotiate the gaming compact that allows tribal gaming in that state? Like IGRA, it’s something most tribes want to avoid.

Third, just how much revenue would come out of online gaming, and how much risk are tribes taking to invest? When online gaming was legalized in Europe over the past decade, more than 90 percent of the websites launched to host online casinos and/or sports books failed. It’s not as easy at it looks.

In reality, how much of a threat is online poker? Anyone who runs a “real” casino understands that poker isn’t a huge money-maker, and it’s also limited to a small universe of players. Would the availability of online poker truly impact a land-based casino? How many slot players would rather stay home to play online poker? I’m betting that number will be very, very small.

If states take the lead, you can be sure that the state lotteries will be ready. Lottery directors are sure to ask their governor, “Why would you allow commercial casino companies or Indian tribes to operate this activity for a tax of 20 percent, when we can operate it and return all the revenue—minus our expenses—to the state?” What kind of response do you think the governor will have?

These are just a few of the questions that remain unanswered (and we didn’t even address some of the technical concerns). Yes, let’s pay attention to what’s happening on the legal landscape, but let’s not blow it out of proportion. Tribes can live, survive and prosper with whatever happens.