According to reports, Evolution Securities issued a note projecting the environment for the online gambling industry in 2009.

The note stated that "merger and acquisition activity and industry consolidation is like to outweigh risk and regulatory uncertainly for the online gaming sector in 2009," according to gamingalerts.co.uk.

Thanks to hints of possible European regulation and PartyGaming's recent announcement that it was settling with the U.S. Department of Justice, investors are beginning to eye the online gambling industry once again.

"European regulation remains on the cards, further enhancing operators’ prospects on the Continent," reported the eGaming Review.

"However, if it happens too soon, online gaming companies would not have enough of a footprint across Europe to compete strongly with existing state monopolies and land-based operators."

Mergers, acquisitions and consolidation would lead to less competition amongst companies for customers and product promotion—Evolution cites 888 and PartyGaming as possible partners.