As the end draws to a close and the good and bad of the UIGEA has mostly played out or has progressed far enough to identify trends I thought it would be a good idea to go back over what I wrote over the last several months. Some of the things I predicted were pretty spot on and others didn’t play out as I thought they would. But I don’t like to gloss over things so let’s take a look.
First, let’s start off with the things that didn’t play out as I expected them to. I thought the fear of the DOJ would cause a bigger impact on the payment processor market. While new processors are not popping up as quickly as many expected the market still remains somewhat robust. Despite the relatively solid health of the payment processor market it does seem as if many poker rooms are turning on and off processors with a lot more frequency than they used to pre-UIGEA.
Next off, I thought the proposed rules for enforcing the UIGEA would be much more comprehensive. The US Treasury left enough loopholes in there that the teeth have been pretty much taken out of it. Granted, I was right in what was possible but I misjudged how stringent the US Treasury would be in coming up with their rules. I would blame that on the banking industry but several banks have spoken up and said they would welcome a list of banned institutions which would make things pretty harsh on the payment processor industry.
Based on how I misjudged the ability of the payment processor industry to weather the storm I was also wrong as it pertains to my thoughts that the liquidity at the US facing online sites would begin to dry up as players had trouble getting new funds into the online gaming system.
My call on consolidation seems to be proving true. Many of the US facing rooms are struggling while traffic consolidates to the bigger sites (Stars and Tilt). For instance, if we look at the numbers from Jan 2007 we see the following sites being tracked by Poker Site Scout:
PokerStars 16380
Full Tilt Poker 7420
Microgaming 2944
Ultimate Bet 3169
Bodog 3376
Absolute 2086
World Poker Exchange 420
If we look at the peak players for those same sites today we see a consolidation trend:
PokerStars 20058 (+22%)
Full Tilt Poker 8706 (+17%)
Microgaming 1963 (-33%)
Ultimate Bet 2512 (-21%)
Bodog 2062 (-39%)
Absolute 2378 (+14%)
World Poker Exchange 117 (-72%)
Stars and Tilt have certainly benefitted from the consolidation effect. Absolute seems to be the lone standout that has higher numbers than they did in Jan of 2007. There have been some new sites to sprout up that are US facing but since they don’t have numbers that can be compared I have not included them in this comparison.
I’ll accept any criticism that this isn’t a perfect comparison but I am sitting in the lobby of my hotel in Phuket and I’m not quite motivated to chew through a bunch of data for this post. I think the numbers are fair enough as a comparative tool to see general trends. If you disagree please feel free to post a comment (and maybe your own numbers so we can all benefit).
Despite some folks who took issue with my numbers I was also right that the Neteller pullout did stunt the growth of the industry. Even some of my critics later acknowledged that given how I was defining the comparison that my numbers did in fact demonstrate what I said they did. Unfortunately, I am still unaware of a better way to compare pre and post UIGEA numbers that is 100% accurate due the massive disruptive factor caused by the legislation.
As I previously commented Barney Frank (and others) has not had the impact everyone thought he would. As I argued at the time when Frank jumped on the anti-UIGEA bandwagon, it would be a long uphill battle and we should not expect to see anything major to occur for at least a year or more. Don’t get me wrong, he’s had an overall positive impact but there’s a big difference between having a positive impact and passing a pro gaming law. We’ll just need to be more patient.
Likewise the Democrats taking control of both houses of Congress has had little overall impact. Many Democrats are anti-gaming for other than religious reasons.
I also did not put too much hope in any sort of WTO ruling. Although I believed that various countries had a good case against the US I just didn’t think that it was going to be the watershed event everyone was hoping it was going to be. Things are still developing with this one though so I could still be proven wrong.
While I have no hard numbers to support this next one I think all one needs to do is look at any of the popular poker message boards to confirm that the game of online poker has gotten a lot tougher. My belief is you have two converging factors leading to this. First is that as poker becomes more popular and access to quality learning material makes its way into the mainstream players will gradually become better poker players. The second is that without the ability to aggressively market in key markets (like the US) the inflow of the super fishy players is more like a trickle than it is the fire hose it once was.
Well, I think that pretty much wraps up the major things I made predictions on in 2007 (and late 2006) in regards to the UIGEA so I’ll go ahead and close out this post with promise to continue being both right and wrong in 2008.
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| Site | Rackback | Sign Up Bonus | US |
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| Cereus Poker Network* | $7,500 | $10,000 | $10,000** |
| Cake Poker | $60,000 | ||
| Party Poker*** | $50,000 | ||
| Red Star | $23,000 | ||
| Eurobet*** | $21,000 | ||
| Players Only | $16,400 | ||
| Tower Gaming*** | $15,000 | ||
| Full Tilt Poker | $10,000 | ||
| Carbon Poker | $12,000 | ||
| Betfair Poker | $12,000 | ||
| Boss Media Network**** | $5,000 | ||
| Cellsino Poker | $5,000 | ||
| Power Poker | $5,000 | ||
| Poker Nordica | $5,000 | ||
| NoIQ | €1,500 |
* Absolute Poker and Ultimate Bet (UB) ** May not be available to all players *** Poker Heaven, Fortune Poker, InterPoker, Paradise Poker
Hi, my name is Bill Rini and this is my poker blog. I've been blogging about poker and the poker industry since around 2003-ish. Like most people I started out playing poker as entertainment in home games whenever we wanted to sit around and smoke cigars, drink beer, and eat pizza, and needed a good excuse. I started playing online shortly after the first online card rooms opened and it wasn't long before I was playing 20, 30, or even 40 hours a week or more. One day I received a phone call about a program manager position at Tiltware which was the company that consulted to Full Tilt Poker on software development and marketing. After Tiltware I spent about 2.5 years working at Party Poker where I was the poker room manager.
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