Poker Business News From Europe

Greek Poker Players to Pay Tax on Winnings
All Greek gambling winnings, including poker, will be subject to a 10 percent tax from September 21.

The decision was made by the Ministry of Economy and Finances, against a backdrop of opposition from the business community — even lottery wins over €1 will be subject to the levy.

The issue of taxation of gambling has been to the fore during the current recession with many governments desperate to raise revenue from lucrative sources.

Ladbrokes and William Hill recently announced their online businesses were moving from the UK to Gibraltar due to lower tax rates.

bwin Poker Continues to Boom
bwin Interactive Entertainment has announced its financial results for the second quarter and the first half of 2009, ending on June 30, 2009, and things are looking good for its poker business, a trend which has continued since its last interim report.

Net poker revenues rose 12.3 percent from €17.9 million in the second quarter of 2008 to €20.2 million in the second quarter of 2009. Also, the first half of 2009 has seen poker net revenues increase by 25.4 percent to €47.9 million from €38.2 million in the same period of 2008. This is largely due to the growth of the poker business in Italy, successful cross-selling, and greater awareness of the bwin brand, the company said.

Overall, all the products have grown. Turnover from betting, poker, casino, and games operations rose by 2.2 percent when comparing the second quarters of 2008 and 2009, and by 6.1 percent in the first half of 2009, compared to the first half of 2008.

Customer bonuses of €13.8 million were granted in the second quarter of 2009 (compared to the €11.6 million granted in the second quarter of 2008). This increase is due to reactivation measures, and also the active migration of the various poker labels to the site.

The number of active customers for poker is up from 287,446 in the second quarter of 2008, to 385,601 in the same period of 2009.

Europe to get New Poker Network
Europe will have a new white label poker network before the end of the year according to a statement from Swedish mobile gaming and entertainment group, Aspiro.

Aspiro’s subsidiary, Miles Ahead, has signed an agreement with its first European poker site — which remains unnamed at the moment — on a revenue share basis. The Maltese company says its new product will offer a “revolutionary head-to-head experience” and, perhaps more revolutionary, will be available on the iPhone.

The site is currently undergoing beta-testing and Gunnar Sellæg, chief executive officer of Aspiro, said, “This partner agreement is our first step forward in our efforts in the gambling technology area. When a well-known poker site chooses to go with Miles Ahead, we see it as a sign that we are on the right track.”

PokerStars Clarifies U.S. Market Share
PokerStars.com recently attempted to clarify details about its market share in America. It did this because of so much speculation and controversy over its status and finances, and what many saw as its dominating success due to its continued operations in the U.S..

The company said that aside from the U.S. market, its liquidity and revenues are still more than twice that of other online poker sites as the U.S. market only accounts for less than 50 percent of its business, in terms of player liquidity and revenue.

The company also said that it continues to operate in America based on legal advice.

Entraction Network Continues to Grow
Entraction network, the publicly-quoted Swedish poker network which is home to popular online poker rooms such as DevilfishPoker.com, today announced net sales for poker up 45 percent in the first half of 2009.

Poker net sales, defined as rake less cashback and bonuses, for the first half year amounted to SEK159.4 million (€15.4 million), compared to SEK110.3 million a year earlier.

Poker net sales amounted to SEK75 million for the second quarter 2009 compared to SEK51.9 million for the same period in 2008, an increase of 44 percent. Rake from integrated partners does not appear in the net sales figure, but is reported as a royalty income.

This royalty income for the first half year totaled SEK18 million compared to SEK8.4 million in the first half of 2008, an increase of 113 percent. The increase is mainly attributable to new partners, the company said.

Royalty income was up 109 percent to SEK8.9 million in the second quarter of 2009 from SEK4.3 million in the second quarter of 2008.

Eurolinx and BetOnBet Go Into Liquidation
The Linx Media Group which operates online poker rooms Eurolinx and BetonBet has announced it has ceased trading and is now putting its sites into liquidation. These sites, plus Linx Casino, were members of the Microgaming Network, but software license agreements have since been terminated.

Liquidators have yet to be appointed, according to a statement released on Eurolinx.com, but for now all player funds are being held. A company spokesperson from the Group said, “It is with great regret that we make this announcement. I appreciate the concern and frustration that this will inflict on the Eurolinx, BetOnBet, and Linx Casino player community.

“Affected account holders are those individuals who have agreed to a contractual relationship with the Linx Media Group through Eurolinx, BetOnBet and Linx Casino. All available player funds are held by these businesses. As soon as we have information on how to lodge claims with the liquidators, we will communicate this via Eurolinx.com, BetOnBet.com, and Linxcasino.com.”
Microgaming has experienced similar circumstances before, when it terminated its license with Tusk Investment Corporation last year. Tusk operated more than 25 online poker sites before going broke.

PartyPoker Results Disappoint
PartyGaming has been in the headlines recently for its new deal with World Poker Tour Enterprises to buy the World Poker Tour. Against this backdrop it recently published its half-year financial results for the six months ending June 30, 2009.

The first result, which appears quite strikingly, is its net revenue for poker. Standing last year at $153.9 million, it has now dropped to $102.6 million. Clean EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) for poker for the half-year 2009 is $25.7 million, but last year it was $36 million, meaning a loss of more than $10 million.

Chief executive officer, Jim Ryan, said, “While poker continues to face competitive challenges from the U.S.-facing sites, the launch of our Italian poker network and a much improved loyalty programme and retention process has seen poker numbers stabilising in the second quarter with unique active players five percent ahead of the first quarter, despite the second quarter being a seasonally quiet period.”

Centrebet Poker Revenue Down
Centrebet, the publicly-quoted Australian bookmaker, recently issued its full year 2009 financial report which shows poker revenue fell 17 percent to AUS$3.8 million (€1.5 million) in the year to June 30, 2009.

The company said this was consistent with international online gaming industry trends. “Poker is an important retention tool for wagering and casino clients and Centrebet is focusing on maintaining current revenue levels via improved acquisition and retention initiative,” the report said.

Last year poker revenue grew in real terms but was negatively impacted by the U.S.$/AUS$ exchange rate.

Overall the company saw strong online growth with casino revenue increasing 10 percent to $13.8 million, driven by massive growth in instant casino products which expanded by 119 percent to $4.5 million.

The company made a net profit after tax of $11 million on the back of solid growth in Australian online revenue, which was up 23 percent to $32.9 million.