When midfielder Tomáš Rosický blasted a shot past Norwegian goalie Thomas Myhre in the pivotal Nov. 16 World Cup playoff soccer game between the Czech Republic and Norway, Radek Šilhan, an employee of one of the country's largest betting chains, jumped in the air.

"It was spontaneous, I couldn't help it," Šilhan said. "I was joyful despite the fact that I knew the goal would cost our company millions of crowns."

Rosický's goal might have secured the win over Norway and the Czech team's advancement to the World Cup in Germany next summer, but it also meant an immediate loss for Šilhan's company, Fortuna. Betters had so much faith in the Czech team, Šilhan said, that the company had to pay out millions of crowns more than it took in from placed bets.

"When it comes to major games, the Czechs tend to be patriotic, so every success costs us a lot of money," said Šilhan, who is Fortuna's spokesman.

Yet Šilhan has reason to smile. The Czech team's advancement to the World Cup should make 2006 a lucrative year for the betting industry. Fortuna and other betting chains, however, will have to compete with online gambling firms to get a piece of the action in a year crowded with major sporting events.

Online threat

Next year will be the first time in 16 years that a Czech team will play in the World Cup. The team's advancement will no doubt be good for the betting industry, but local betting firms know they'll need to fight for clients.

Internet betting firms are persuading more and more gamblers to place their bets online. That such betting is illegal in the Czech Republic doesn't seem to dampen business visibly.

"The market cannot grow much more in this country, but Internet firms are illegally taking a big bite out of it," said Vratislav Randa, director of Tipsport, the country's largest betting chain.

Last year, Czechs placed more than 10.6 billion Kč ($42.2 million) in bets. Foreign online betting firms such as Sportingbet, Betandwin, Worldbet, Betsson or Eurobet, which launched their Czech-language Web sites only last year, already control around one-tenth of the market.

They've been able to gain market shares by offering punters higher returns on bets. This is possible because Internet betting firms have lower maintenance costs than regular betting shops.

Tipsport suffered from the competition last year, with revenues falling 3.3 percent, Randa said. "We lost about 600 million Kč in revenues as a result of illegal competition," he said.

Kateřina Luisa Daňhelová, general director of Synot Holding, which runs 600 betting shops in this country, said that either Internet betting firms should be forced out of the market or all gaming companies should be allowed to launch online betting.

"A change in the law should end illegal practices, including advertising for these services," Daňhelová said. "Otherwise, the market should be liberalized so that all Czech betting firms can offer Internet betting."

Toothless defense

The state has repeatedly found itself on the losing side of the fight against online betting. Foreign firms continue to target the market despite the Czech government's stance.

The government decided to take a harder line in spring 2004 after British firm Betsson not only expanded its international portfolio by adding Czech to its Web site but also launched an advertising campaign here. The government sent an official appeal to Betsson, requesting the betting house remove the Czech language option from its Web site.

Martin Bunge Meyer, Betsson's communications director, said Betsson is aware that online betting is illegal here. But, Bunge Meyer said, Betsson operates on a British business license so the company doesn't have to comply with the Czech government's appeal.

Besides, he said, citing the hazy concept of physical location on the Internet, "Our response to that appeal is that we are not present in the Czech Republic."

In the government's most recent attempt to force foreign Internet firms out of this country, Finance Minister Bohuslav Sobotka initiated an investigation Nov. 2 by the Supreme State Attorney's Office into the legality of the firms' operations.