Gaining A Better Understanding Of IP Geolocation Issues

As geolocation becomes an increasingly important topic for online gambling operators the number of issues regarding IP geolocation is only likely to grow.

One important note about IP addresses is that they do not contain any geographical information, but instead contain routing information. This means that IP database providers have to map individual addresses in order to attain their location, which as stated in a paper by the University of Toronto causes, “long-term maintenance issues”.

The claims made by IP databases providers with regards to their accuracy can vary wildly from the truth. Companies often claim accuracy as high as 98% to 99%, but actual accuracy might range from anywhere between 35 – 55% on a state or city level.

However, even if accuracy is as high as some IP database providers claim, this does not mean that a casino player is actually where their IP address would indicate they are. This is because a player’s Internet Service Provider could be routing their connection through a proxy server, which provides an IP address located miles away from a player’s true location.

There have been some reports of Canadians receiving IP addresses located as far away as Kansas when using AOL as their internet service provider. If the state of Kansas was ever to pass online gambling legislation this situation could result in Kansas based operators illegally accepting Canadian players if the operators relied on IP geolocation as a stand alone system. Of course such a situation is no better for Canadian online gaming sites or Canadian players, as the former would not be permitted to accept Canadian players with US IP addresses and such players would be denied access to Canadian gaming services even though they are legally entitled to them.

The accuracy of geolocation services is paramount to online gaming operators to ensure they do not break the law or the conditions of their gaming licenses. Additionally, if location data is not reliable, geolocation services lose their value as a source of analytics information that tell operators where customers prefer to play, where they are the most likely to deposit money, and what effect location has on the type of games played.