Business Matters

Figures Up, But Game Off

Hilton chief David Michels was in top form when pre­senting the group's [which includes Ladbrokes] results last month.

Michels normally insists on delivering his profit numbers at the crack of dawn on a Thursday, after a late-night poker session with friends. But this time around, his weekly poker game was cancelled for the first time in 17 years!

His announcement included news that Ladbrokespoker.com now has more than 64,000 active players, representing an increase of 156 percent over the previous year.

Still Growing
Recent estimates from the Vancouver-based outfit Pokerpulse indicate more than $190 million is bet in online poker games every day, up from $11 million two years ago. During that period, the number of active players has grown from about 83,000 to nearly 1.9 million.



Meanwhile, figures compiled by investment bank DKW show online gambling is worth $9.2 billion (£4.8 billion) a year. In 2004, gamblers worldwide, online and off, lost $237 billion. It is estimated that the amount that Britons are gambling over the Internet has increased more than sixfold in the past year.



Software Profits, Logically

Internet gambling software group Cryptologic, whose customers include William Hill and the Ritz Casino Club, has reported a 44 percent surge in revenues over 2004.



Income for the year was $63.7 million, with pretax profits up 55 percent to $16.5 million. Cryptologic plans to invest in poker technology after a 165 percent increase in fees generated from poker, which accounted for 20 percent of its revenues in the last quarter of 2004.



NET Profit

In another sign of interest in the industry, NETELLER, an online money-transfer service that derives 80 percent of its business from facilitating payments for gaming and betting sites, has seen its share price triple since it listed in London in April.



North Dakota the First U.S. State to Allow Internet Gaming?
Two pieces of legislation that would allow companies to set up Internet poker (and gaming) sites in the American state of North Dakota have been tabled.



House Bill 1509, which passed with a vote of 49-43, sets up the guidelines for the sites, while House Concurrent Resolution 3035, which has been heard in committee, allows people to vote to change the state constitution to allow Internet poker sites.



Should both pieces of legislation pass, companies would be regulated and taxed by the state. It could result in millions of dollars in income and make North Dakota the Las Vegas of cyberspace gaming.



However, many believe the federal government would strike down the law, but not Patrick O'Brien, an attorney who represents clients in the Internet poker and gaming industry. He doubts the federal government could stop North Dakota from allowing the sites.



"Gambling has always been a states' rights issue," O'Brien stated. "If North Dakota legalizes it, then it's legal."



Leeson Still Gambling

Ten years have passed since Nick Leeson gambled away £862 million and ruined the 230-year-old merchant and royal banker Barings.



But it seems that old habits die hard, as the "Rogue Trader" is now an avid poker player and a regular at Celebpoker.com, where he is joined by actors Joaquim De Almeida, Lou Diamond Phillips, and Gareth Hunt, radio presenter Chris Brooks, comedian Norman Pacecricketer Ed Giddins, football manager Harry Redknapp, snooker's Ken Doherty and Mark Williams, rugby player Lawrence Dallaglio, and a host of soccer players.



The site was founded by David Donovan to enable the public to play poker against their favourite celebrities online, and is said to be "the first and only online poker site in the world to bring together celebrities and the general public to play the most realistic poker experience on the Internet."



Interestingly, Celeb Poker recently announced plans for a betting exchange, multiplayer bingo, and celebrity auction.



Oddschecker Launch

Leading odds comparison website oddschecker.com has spread its wings by launching two new sites to cater to the online casino and poker markets.



The aim of the site, bought by UKbetting in December 2003, is to monitor the latest jackpots, tournaments, and bonuses being offered amongst gaming sites.



Hill Both Cancels and Makes Plans

William Hill has cancelled its plans to enter the land-based casino business, returning £453 million to its shareholders in the process.



The cash-generative bookmaker said the government's decision to restrict new casinos to 24 reduced the scope for acquisitions or mergers between bookies and casino operators.



However, online poker has proved popular with Hill, and it has been revealed that William Hill's Channel 425 will soon introduce a poker magazine programme, followed by a $1 million tournament at the end of the year.



When contacted by Card Player Europe, David Hood, a spokesman for William Hill, declined to make further comment, but said a full announcement on the Leeds-based company's plans for televised poker would be made shortly.



ParadisePoker Share Value Increases

Sportingbet, which splashed out £163 million (then $315 million) for the Costa Rican-based ParadisePoker in October 2004, has ­announced its pretax profits were up 117 percent at £18.3 million ($34.9 million).



In the period ending in January, the company's accounts show Paradise chipped in £8m ($15.3 million) of Sportingbet's £26 million ($49.7 million) operating profits.



The hike was helped by an above-target performance by ParadisePoker, which has seen its customer numbers increase by nearly 100,000 to 837,000 since its acquisition by the online bookmaker. Furthermore, the number of games played on the Paradise site has reportedly leapt 61 percent compared to the same time last year.



Many thought Sportingbet overpaid for ParadisePoker last autumn, but the conventional wisdom now is that it got an extremely good deal. Its shares have surged from 100p to beyond 300p since.



Analysts say the dramatic increase in value is equally attributed to the results of increasing profits in a rapidly growing market and investors' interest due to speculation that the Hilton Group (owners of bookmakers Ladbrokes, who already operates the UK's biggest poker site) is planning a takeover bid, a move nonsensed by the hotel chain.



Regardless, an understandably upbeat Nigel Payne, Sportingbet's CEO, said ParadisePoker's performance was "well ahead of expectations," and added, "we believe there are around 80 million poker players in the world, and online every day there are about 1.5 million. This is a huge market, and not very many of them are yet going online."



Bookkeeping and share value apart, Scott Wilson, director of poker operations for Sportingbet, added, "We're delighted with the growth we've been seeing at ParadisePoker as of late.



"Players have been flocking to Paradise over the past six weeks to secure their spot in our upcoming Paradise Masters tournament, which has a $1 million-guaranteed prize pool.



"As well, with our inclusion in the Sportingbet Group, we're seeing some great crossover between sportsbook players and poker players, and vice versa. When you walk into Bellagio in Las Vegas, the sportsbook is right beside the poker room – and that's for good reason!"



Conceding that it is tough to quantify, Wilson said there are other reasons for Paradise's growth. "With all the new sites popping up out there that are spending marketing dollars to introduce newcomers to our great game, I think a lot of players try online poker for the first time, wooed by deposit bonuses and other promotions designed to help a fledgling site gain critical mass.



"As this new customer gains familiarity with online poker as a product, he looks to see what else is available to him. A good number of these new and curious players end up at our site for one reason or another.



"We've got a great reputation for customer service, our software is unique to all others, and we're one of the most established sites out there, having dealt our first real-money hand back in 1999.



"As one of the larger sites, we are able to offer our players a nice range of action, as well. In addition to a huge variety of cash games to choose from, we also have a nightly $50,000-guaranteed tournament, chances to win seats in World Poker Tour events, and, of course, we'll be sending a large number of players to this year's World Series of Poker through our supersatellites." ´