Barrington teen's summer job ends up an Internet gaming sensation

When Judy Gerber of Barrington told her teenage son Alex to get a job, she never imagined he'd create a Web site that now boasts more than 70,000 users.

When she learned the site was for gambling and purportedly legal, well, that gave her pause on both fronts.

The legal part sounded "too good to be true," she acknowledged. But then again, she reasoned that "it seemed quite harmless compared to what teenagers could be doing these days in the summer."

Inspired by his own love of cards and a similar Web site for sports betting, Alex launched his Internet poker enterprise last summer.

The result, centpoker.com, allows users to play poker online and win real money - without betting any of their own. Alex said that's how it's able to operate legally, despite laws that ban Internet gambling.

Now 17, Alex has seen the number of users grow steadily and, in late June, unveiled a more sophisticated version of the site with a new design.

Judy Gerber said her son's love of cards started with his father, who died five years ago. The two were close and often played cards together.

"That's why to me I think I understood it," she said. "I realize the innocence and the significance of it."

Alex, who'll be a senior at Barrington High School in the fall, had already been playing online poker with friends. He thinks it's more challenging than face-to-face games.

"It's interesting because you can't see the other person on the other side, so you have to try to figure out what they're going to do," he said.

Inspired by sports site

Victor Palmer, the creator of centsports.com, a similar site that hosts free betting on sports games, helped Alex strategize and provided him with codes to add features. Alex's cousin, Andy Norbeck, lent ideas and helped create graphics for the site.

Palmer, a child prodigy who earned a college math degree at 16, told The Eagle of College Station, Tex., last year he expected his site to make $500,000 to $1 million by the end of 2008.

Wil Schobeiri, who now runs centsports.com, said he and Palmer had already thought of using their model for a poker Web site, but when Alex contacted them with the same idea, they were happy to have him give it a go.

Schobeiri said centpoker.com hasn't taken off as quickly as centsports.com, which has gained more than a half million users since launching in late 2007.

But "considering what is, I would say (centpoker.com's performance) is pretty good," said Schobeiri, who's just 21 himself. "Alex has the mentality to make it happen. ... He has a lot of potential."

Alex's earnings have humble so far, with ad revenue generating $4,000 to $5,000, he said. So far, the payouts have also been modest, with the highest-paid winner on centpoker.com receiving just $144.

In addition to the community pot, revenue goes toward operating costs. Alex does earn a profit and said he considers centpoker.com a part-time job.

Several months ago, he added a twice-monthly tournament to the site in hopes of drawing new members. It worked, and he said he continues to add 10,000 new users a month.

His interest in computers is nothing new. He taught himself to use applications on a laptop he received in eighth grade and, for several summers, attended computer camp. He's built Web sites for family members before but had never before managed his own.

Legality is murky

Alex says one reason he decided to start the site was because he and his friend chafed at Internet gambling being banned.

The question of the legality of such non-wagering sites, though, appears to remain a somewhat murky one.

Lt. Luis Gutierrez of the Illinois State Police, which has an Internet Crimes Unit, said the department doesn't consider the Web site illegal because it's for entertainment purposes and users aren't spending money. He said players are essentially getting paid to view ads.

But University of Illinois Professor of Business Administration John Kindt, while declining to judge Alex's site specifically, said the legality of similar ones has been successfully challenged in court.

Kindt, an outspoken critic of gambling mainly because of what he sees as its negative economic impact, said federal authorities have added regulations to the law and continue to modify it. He noted there's a long history of Congress banning various types of "wire" gambling, going back to telephone gambling.

"It would be unwise for a student to challenge this trend by claiming some kind of, quote-unquote, gray area," Kindt said.

Moral questions?

Legality is one thing; morality can be quite another.

Alex says self-professed gambling addicts have told him his site allows them to safely feed their habit because they don't risk their own money.

Anita Bedell, director of Illinois Church Action on Alcohol and Addiction Problems, isn't convinced that it's such a good idea for recovering addicts to use the site. She said players will become comfortable gambling, become overconfident, and turn to a Web site where they can win more money.

"It's like a training ground," she said.

Alex did say younger people - high school and college kids - are centpoker.com's main users.

Bedell said that's dangerous because gambling among teens is on the rise. She cited findings from the 10-year-old National Gambling Impact Study Commission report's finding that 1.1 million minors aged 12 and 18 were gambling, more than any other age group.

"It's very easy for young people to become addicted because nobody is watching," Bedell said.

A steppingstone

Whatever the impact on its users, centpoker.com has "actually blossomed into a very good learning experience" for Alex, his mother said.

She said creating and running the site has given her son experience with negotiating and developing relationships with partners. As a manager of the site, he has to answer user questions and deal with technical difficulties.

Alex said he wants to study the Internet and computers in college, with the hope of working for a company like Google or Microsoft. He plans on running the site as long as he can.

Judy Gerber hopes it will help him get into a better college next year by allowing him to stand out from other applicants.

"I'm in awe," she said. "I'm really amazed."

<p class="factboxheadblack">Why centpoker.com is - apparently - legal</p> <p class="News">• The Unlawful Internet Gambling Enforcement Act of 2006 made transactions between financial institutions and gambling sites illegal, effectively banning online gaming. Many such sites were shut down or stopped operating in the U.S. University of Illinois Business Professor John Kindt said the law was intended to strengthen one enacted almost 50 years ago to keep gambling off the wires and phone lines, a practice then often associated with organized crime. Centpoker.com purports to be legal because users don't put up their own money - a claim backed by Illinois State Police. But Kindt said it's a murky area of law and that similar sites have been successfully challenged in court.</p> <p class="breakhead">How centpoker.com works </p> <p class="News">• Users of centpoker.com, created by Alex Gerber of Barrington, play Texas Hold 'Em. </p> <p class="News">• Each new player is granted 100 chips, worth about 3 cents total, and uses those to place bets. </p> <p class="News">• Once a player earns $10, he or she can cash out and keep that money. </p> <p class="News">• Players who lose all their chips are simply granted 100 more.</p> <p class="News">• All the money used for payouts comes from advertising on the site. Alex works with PastTimer Media, which helps startups find advertisers and opportunities, and a Google program provides him with additional ads. </p> <p class="News">• The site's current pot is about $2,100, with more than $1,500 cashed out to date</p> <p class="News">• The highest paid player has received just $144.</p>