Industry News

iPoker Revenue Bucks Trend

The iPoker network, owned by Israeli online gaming operator Playtech, saw revenue expand 60 percent in the third quarter of 2008 (Jul. to Sept.) to €7.6 million from €7 million in the same period of 2007. Revenue grew by 9 percent on the second quarter of 2008.

Overall in the first nine months of 2008 revenue at iPoker jumped 88 percent on the first nine months of 2007 to €21.5 million.

Playtech's overall revenue for the first nine months of 2008 was €80.1 million, up 78 percent on the same nine months of 2007. Of this, casino represented the largest proportion at €57.3 million - up 78 percent on the first nine months of the previous year.

During the third quarter of 2008 the company successfully migrated MansionPoker to the network, and launched a play money poker site on its Italian network, with a real money version of the site expected by the end of 2009. It also completed a deal with William Hill worth $250 million.

PartyPoker Feels the Pinch

Party Gaming, the publicly-quoted parent company of PartyPoker, PartyBets, PartyCasino, and PartyBingo, saw poker revenue for the third quarter 2008 decline 15 percent to $65 million from $76.3 million in the same period of 2007.
In its interim report the company explained the drop, saying the fall reflected "lower yields driven by a reduction in the number of unique active players and their frequency of play".

Several key performance indicators registered slides year-on-year during the third quarter: active players were down 12 percent to 5.9 million, daily average players fell 13 percent to 63,900, new real money sign-ups were 10 percent lower at 137,600, and average daily revenue was off 8 percent at $1.3 million.

The company said the appreciation of the U.S. dollar impacted revenues but benefited costs.

It was not all bad news for the company as its diversification into casino, bingo, and sports helped shore up total revenues which were broadly steady at $117.8 million from $118 million in the third quarter of 2007.

Tax Victory for Swedish Online Poker Player

A Swedish court has ruled an online poker player does not have to pay tax on SEK 650,000 ($80,900) he won playing poker online with an Isle of Man-based site which is operated by a Cyprus-based company.

The Swedish tax authority Skatteverket had originally demanded that Sargon Rüya pay tax on his winnings because the Isle of Man is not part of the EU, but Rüya was able to prove the company was operated by a Cypriot parent and the earnings were therefore from within the EU.

However the court went a step further and said that Skatteverket could not place the burden of proof of where foreign companies operations are based on an individual in order to collect tax.

The court awarded costs to Rüya.

Pacific Poker Reports Flat Revenue

Net gaming revenue at Pacific Poker, the online poker offering from publicly-quoted gaming operator 888.com, remained steady at $18.7 million in the third quarter of 2008, marginally higher than the third quarter 2007 figure of $18.6 million.
However, in the first three trading quarters of 2008 poker revenue dropped from $21.9 million (Q1), through $19.8 million (Q2) to the third quarter figure of $18.7 million.

The number of active players at Pacific Poker also remained broadly steady at 169,607 from 168,105 in the third quarter of 2007 while net gaming revenue per active player reflected these figures with third quarter 2008 yielding $110 compared to $111 a year earlier.

In the third quarter reporting period the company released Pacific Poker in four new languages - Russian, Latvian, Lithuanian, and Estonian with seven further languages to be released shortly; Japanese, Greek, Hungarian, Bulgarian, Romanian, Hungarian, and Czech.

Overall net gaming revenue at 888.com which includes casino and bingo was up 23 percent to $66 million from $57 million in the third quarter of 2007.

Bwin's PokerRoom and EuroPoker Underperform

Poker net gaming revenue at Austro-German online poker provider bwin grew 7 percent in the third quarter of 2008 to €19.8 million compared to the same quarter of 2007, while growth in the first nine months of 2008 was up 4 percent to €58 million.

While the number of active customers in the third quarter of 2008 fell 9 percent to 206,791 compared to 227,038 in the third quarter of 2007, the number for the first nine months of 2008 grew 23 percent to 509,910 compared to the same period in 2007.

The company said in its interim report that, "Whilst bwin poker is experiencing dynamic development, the poker labels PokerRoom and EuroPoker remained below expectations. As already announced, the various different poker labels will be merged into the bwin poker label during the course of Q1 2009. This will enable the poker segment to benefit from the strong bwin brand coupled with improved cost efficiency."

Overall bwin interactive, which also operates sportsbook, casino, and bingo, saw gross gaming revenues up 11.2 percent to €95.9 million compared to €86.2 million in the third quarter of 2007.

Everest Poker Results Mixed

GigaMedia, the publicly-quoted Asian online gaming operation, saw revenue at Everest Poker grow 7 percent, year-on-year, in the third quarter of 2008 to $23.5 million. However, compared to the previous quarter revenue fell 14 percent.

There were 176,000 active depositing players during the third quarter 2008, this was down 8 percent on the previous quarter which the company says reflects the traditionally slow third quarter of the year.

New depositing real money players expanded 8 percent from the previous quarter to 38,000.

Overall the company, which recently integrated its casino and poker platforms, saw revenues increase 16 percent to $45.7 million compared to the same quarter in 2008, but this was 7 percent lower than the second quarter of 2008.

Paradise Poker Shrinks

Online sports betting, casino, and gaming group, Sportingbet Plc, announced its first quarter results for the three months ending Oct. 31, 2008.

Its brand ParadisePoker generated rake for that period in the European region of £5.1m before bonus deductions. That figure is down 7.3 percent year-on-year.

Amounts wagered for the quarter were £364.9m, a good improvement on those reported for the first quarter of 2007 - £290.9m - with net gaming revenue (NGR) up from £30.4m in 2007, to £38.9m in 2008.

Poker however, only contributed £4.4m to both amounts wagered and NGR - it now accounts for a mere 12 percent of the company's NGR. It reportedly, "continues to struggle in the highly competitive European landscape resulting in NGR down 4 percent year-on-year."

Poker is said to remain difficult due to the competitive nature of the environment, particularly because of large U.S.-facing poker rooms targeting European customers.

CryptoLogic and Boss Media Merge Poker

CryptoLogic, the publicly-quoted online gaming software provider, has announced a strategic partnership with Boss Media which will see its poker customers merged with Boss' International Poker Network (IPN) and expected savings of $12-15 million.

The move comes in the aftermath of CryptoLogic's recent announcement that its strategic focus would shift to casino gaming. The move, which will affect online poker rooms such as InterPoker and Parbet, is planned for early 2009. CryptoLogic will continue to provide back-office services.

Online Poker Rooms on the Move

Consolidation in the online poker industry is continuing apace with the announcement by SunPoker that it is moving to the rapidly expanding iPoker network while WPT Online has closed its doors for good.

SunPoker will leave the beleaguered CryptoLogic network before the end of January 2009, migrating its players to the iPoker network while World Poker Tour Enterprises, which is shifting its strategic focus, has wound down its online poker room and has recommended its players open new accounts on CryptoLogic room InterPoker.

iPoker has been aggressively picking up online poker rooms to expand its network while CryptoLogic recently entered into a strategic partnership with Boss Media.

Elsewhere Cantor Gaming has closed its retail-facing online poker business to focus on "licensing its proprietary technology, software, content, intellectual property, and data to online casino operators and resort-based casino operators".