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19 Apr


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Social Gaming to Fill Poker Void

April 19, 2011 | By | One Comment

Image courtesy of iTechWhiz

On Friday April 15, the United States Department of Justice (DOJ) indicted 11 people on charges of fraud and money laundering.  Among those arrested were principles of poker site giants PokerStars (PS), Absolute Poker, and Full Tilt Poker (FTP).   The DOJ seized URLs and froze at least 75 bank accounts in connection with the charges.  The poker and online gambling world are going to take a large hit from these shutdowns.  These poker sites did approximately 25-40% of their business in the U.S; and continued operating even after the 2007 case against Neteller (beginning of building the current DOJ case). PS and FTP are top sponsors of poker events, TV and radio shows, and the actual players.  Loss of revenue means loss of advertising budgets and less exposure worldwide.

Many professional players are expected to move out of the country because most of their contracts with these sites pay them on a per hand played basis.  Take Aze Gallo for example; a 25 year old pro from Florida who said, “Honestly, I’m mostly thinking about it because of being disgusted about living in a country that would ban online poker. I’d rather play poker abroad than do something else in this country at this point. I feel like my country is trying to make money in the guise of holding my hand.” Keep in mind that players living outside of the U.S. are not restricted and can still play cash games on these sites.

Industry experts and players alike believe that this more of a political decision than a legal decision.    With PokerStars and Full Tilt Poker moving their operations overseas, the U.S. poker/ online gambling industry has opened a large void.

The new social gaming offerings from digital entertainment leader’s and Zynga could conceivably fill this gap.  Experts forecast these online gaming companies will team up with land based casinos and build a new online poker environment.  Although the potential gaming offerings could be good as a whole, losing these huge industry leaders will definitely impact the bottom line of the game, losing a significant amount of the $16 billion in annual wagers.  The poker world grew with its ability to reach players from all over the world, now they just hope to survive this debacle.

What do you think about government policies as they relate to the internet and gambling?  Why can these sites operate everywhere else but inside the United States?


  1. HCL

    I found this quote from a CNBC interview with poker agent Brian Balsbaugh of Poker Royalty, the most knowledgeable poker authority:

    “When Pokerstars, Full Tilt and Absolute Poker left the US market, 95 percent of the market share for US poker players absolutely disappeared and with that so did $200 million worth of marketing money and advertising money that these companies spent in order to acquire new customers. What that means is basically poker television shows like “The Big Game” on Fox and “Poker After Dark” on NBC are completely gone. So the poker landscape has changed dramatically in a very short period of time.”

    These numbers are staggering!

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