During the downturn that followed the banking collapse in the US and Europe many CEOs of publically traded companies were quick to cite the global economic crisis as the reason for underperforming. Well, at least they cited it as a reason. They usually included an increasingly competitive market as a co-contributor.
But now that it seems the economy in many core markets like the US, UK, Germany, and so on is beginning to turn around, will it buoy the online poker sites or will poker rooms already on the decline continue to decline?
My guess is that rooms underperforming will continue to disappoint. I’m biased though because I’ve never believed that angle. I’ve always felt it was a convenient excuse for companies already performing poorly.
According to PokerScout the online poker market increased at a rate of 32% year over year. While more players doesn’t always translate into more revenue since you could be attracting a lot more MTT players but it sure as hell blows to hell any excuse anyone has for lower player signup numbers.
Now, I know that poker and casino customers are a different breed but when a company that has both operations reports disappointing results in poker and record profits in their casino operations you have to question whether or not that poor economic conditions excuse holds much water. Wouldn’t both be impacted since for most players they are net losers and play mostly for entertainment?
The real danger for most poker rooms is not the economy but increasing competition. It’s no coincidence that everyone and their mother seems to want to get into B2B. PartyGaming has said they want in the business, Bodog has been making news about their planned network, PaddyPower has launched a B2B arm, Bwin says it is going to focus on push B2B, and 888 has been trumpeting their Harrah’s deals as a forward direction for the company. [Note: Some of these B2B deals are casino related]
A lot if people have looked at PartyGaming’s recent moves such as purchasing the WPT and claimed this was part of their plan to return to the US market. To me it says that they’re diversifying their portfolio so they don’t have to rely as much on poker operations to make their nut.
Party’s poker revenues are never going to go to zero even if they stopped all marketing activity but if you look at everything PartyGaming is doing it’s aimed at diversifying their portfolio. Casino now represents over half of their revenue. Casino wasn’t even considered a serious product when I joined in 2006 (kudos to Dominic for building up casino). Their purchase of bingo operator Cashcade was another move to diversify their income stream away from poker.
I don’t mean to single out Party because basically it’s what everyone is doing right now. Everybody is in the same boat. As the poker business consolidates into a few large players everyone seems to be looking for a way to diversify their businesses to rely less on poker revenue.
So, even when the economy picks up, I doubt it’s going to have a huge impact. The poker market was already growing at a 32% year over year rate even during an economic downturn so there’s little reason to expect that when the economy picks up that it will radically change the fundamental shift going on in the online gaming space.
Photocred to jeremyfoo
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| Site | Rackback | Sign Up Bonus | US |
| Absolute Poker | 30% | 150% up to $500 |  |
| Ultimate Bet | 30% | 111% up to $1100 | |
| Cake Poker | 33% | 110% up to $600 | |
| PKR Poker | 30% | 100% up to $800 | |
| Paradise Poker | 30% | 200% up to €1,000 | |
| Players Only | 33% | 100% up to $650 | |
| Fortune Poker | 30% | 200% up to €1,000 | |
| Betfair | 30% | $1500 | |
| Aced | 30% | 100% up to $500 | |
| Virgin Poker | 30% | 200% up to £1000 | |
| Poker Heaven | 30% | 200% up to €1000 | |
| Poker Nordica | 30% | 100% up to $200 | |
| Carbon Poker | 30% | 150% up to $1000 | |
| Red Star Poker | 33% | 110% up to $600 | |
| True Poker | 27% | 100% up to $200 | |
| Action Poker | 35% | 100% up to $2500 | |
| Cellsino Poker | 40% | 500% up to $500 | |
| Minted Poker | 40% | 100% up to $400 | |
| Power Poker | 33% | 110% up to $600 | |
| Interpoker | 30% | 200% up to €1000 | |
| Doyles Room | 33% | 110% up to $600 | |
| Gutshot Poker | 33% | 110% up to $600 | |
| Full Tilt Poker | 27% | 100% up to $600 | |
| Fat Bet Poker | 40% | 1000% up to €500 | |
| NoiQ Poker | 30% | 100% up to €5000 |
| Site | Rake Race | Rake Chase | Freeroll |
|---|---|---|---|
| Doyle's Room | $35,000 | ||
| 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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