Black Friday and the aftermath: Online Poker Implications

[AlunB]

Crypto don't really do poker anymore tikay. They pulled out a while back. Let me find the release...

Ladbrokes results are just awful for poker. Especially when you contrast with Hills and 888.

Saying poker is not a priority is madness in my opinion.

[tikay]

In essence then, the market leader and a few up and coming specialists aside (cough), the online poker market remains in recession, yes?

Something like that. Not sure "remains in recession" sums it up fairly, but it would be a perfectly English form of understatement I guess.

[tikay]

Crypto don't really do poker anymore tikay. They pulled out a while back. Let me find the release...

Ladbrokes results are just awful for poker. Especially when you contrast with Hills and 888.

Saying poker is not a priority is madness in my opinion.

Yes, please do, I'd be curious, I can't quite recall the route they took.

Crypto, as they were known, were huge, but I assume they sort of disappeared when the Playtech/WmHill thing came along?

[AlunB]

http://www.marketwire.com/press-release/CryptoLogic-Forms-Strategic-Partnership-Poker-With-GTECH-Corporation-Subsidiary-Boss-919380.htm

There you go.

They stopped trying to compete essentially and focused on their casino business.

Poker software is hard. Really hard to get right.

[tikay]

Crypto don't really do poker anymore tikay. They pulled out a while back. Let me find the release...

Ladbrokes results are just awful for poker. Especially when you contrast with Hills and 888.

Saying poker is not a priority is madness in my opinion.

For clarification, Rank said that, not Laddies. To be honest, it makes perfect sense in the case of Laddies & Rank to just abandon ship as to online poker now. Things will never be the same, eh?

[AndrewT]

Saying poker is not a priority is madness in my opinion.

Not really - if you're a UK-focused company there's no growth there, and it's easier to make money in other things.

[tikay]

http://www.marketwire.com/press-release/CryptoLogic-Forms-Strategic-Partnership-Poker-With-GTECH-Corporation-Subsidiary-Boss-919380.htm

There you go.

They stopped trying to compete essentially and focused on their casino business.

Poker software is hard. Really hard to get right.

So true, & only 2 or 3 ever got it anywhere near perfect, & one of those seems to have disappeared now. But even less than optimal software gets the job done if the Marketing is right, & tightly focused.

[AlunB]

No Ladbrokes said it too. http://www.egrmagazine.com/news/1684137/long-way-to-go-admits-ladbrokes-ceo.thtml Bottom of fifth para

You're right there Andrew. But it's not like sports betting and casino are easy, and with no risk or difficulty in recruiting customers.

And poker is a guaranteed margin business in a business where there is considerable downside risk. Even in casino short term.

Also when you are Ladbrokes you HAD a poker brand. And your core business is already sports betting so you surely can afford to have another priority alongside that. So it's casino is it? Well what an exciting and dynamic business plan...

[AlunB]

To clarify my point, what I guess I am saying is people are saying it's 'not a priority' because they tried to make it work and failed.

Not because you can't make money from it.

IMO.

[AndrewT]

Thanks for posting that link Alun - I couldn't remember if I'd read that Laddies were scaling back on poker, or had heard it from within, so didn't like to post on thread if I wasn't sure where I'd got the info from.

Whilst poker is guaranteed margin (to an extent), it's thin margin if you have to use bonuses/rakeback to retain players (which you'll have to do if you're not massive like Stars).

[tikay]

To clarify my point, what I guess I am saying is people are saying it's 'not a priority' because they tried to make it work and failed.

Not because you can't make money from it.

IMO.

This.

I think the point you are making is that Online Poker is - or should be - a perfect fit with a common wallet on an integrated Gaming site, as the returns are more predictable, & steady cash flows pretty much guaranteed if eyes are not taken off the ball. A cash cow, even.

I have just realised that I omitted Unibet's numbers for the 6 months - they were down from €11.8 million to €7 million, which is a steeper fall than even Laddies & Rank. Thats falling off a cliff, & remember, Unibet Poker is a global brand, not just British. (We are talking Poker ONLY here, in all cases, the rest of the businesses are in fine shape).

[tikay]

Thanks for posting that link Alun - I couldn't remember if I'd read that Laddies were scaling back on poker, or had heard it from within, so didn't like to post on thread if I wasn't sure where I'd got the info from.

Whilst poker is guaranteed margin (to an extent), it's thin margin if you have to use bonuses/rakeback to retain players (which you'll have to do if you're not massive like Stars).

I think that's less & less the case, Andrew, the whole structure of the market is changing, & unsustainable rakeback deals will continue to gradually disappear.

[AlunB]

Thanks for posting that link Alun - I couldn't remember if I'd read that Laddies were scaling back on poker, or had heard it from within, so didn't like to post on thread if I wasn't sure where I'd got the info from.

Whilst poker is guaranteed margin (to an extent), it's thin margin if you have to use bonuses/rakeback to retain players (which you'll have to do if you're not massive like Stars).

Stars 'rakeback' is one of the most generous in the market for high rollers at least. They just don't advertise it as that.

I would say if you have to use bonuses and rakeback to retain or attract players then you're doing it wrong.

[AlunB]

Actually that's a bit simplistic. I realise it's not that easy.

But there is a paucity of imagination and innovation within poker marketing. And that is definitely partly to blame for the decline in interest.

[AndrewT]

Thanks for posting that link Alun - I couldn't remember if I'd read that Laddies were scaling back on poker, or had heard it from within, so didn't like to post on thread if I wasn't sure where I'd got the info from.

Whilst poker is guaranteed margin (to an extent), it's thin margin if you have to use bonuses/rakeback to retain players (which you'll have to do if you're not massive like Stars).

I think that's less & less the case, Andrew, the whole structure of the market is changing, & unsustainable rakeback deals will continue to gradually disappear.

If you don't have a USP as a company (Stars' software/liquidity, 888's fishpool, Sky's Help the Aged employment programme) then you're always at risk of losing your bigger players to other rooms, which is why it's the companies on networks who are suffering the most.

The reason those big rakeback deals are disappearing is because they cut margin to very thin levels, meaning you're relying on volume to make money.