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Lyle Berman and Howard Greenbaum

by Roy Cooke |  Published: Mar 22, 2005


Once upon a time, the World Series of Poker belonged to Benny Binion. It was his. He could do whatever he wanted, and he answered to no one. Then it was Jack's, and then Becky's. As the leaders of privately held family businesses, they too could do whatever they wanted. But then, the WSOP became the asset of Harrah's, a publicly traded major corporation. This meant that a corporate official – presently, Howard Greenbaum, director of poker operations – became Mr. WSOP. But Greenbaum answers to the officers above him in the corporation, and they answer to a board of directors. And they all operate under the auspices of the Securities and Exchange Commission.

Lyle Berman is the man behind Lakes Entertainment Inc., a Nasdaq company that owns the majority of the World Poker Tour. Lakes spun off the WPT as World Poker Tour Enterprises LLC in September 2004. As the top man, Berman doesn't have to answer to a chain of command the way that Greenbaum does, but he does have to deal with the SEC.

Regardless of corporate and governmental issues, however, Greenbaum and Berman effectively control the two most well-known brands in poker: theWorld Series of Poker and the World Poker Tour, respectively. They make the rules for their events, everything from how much the buy-ins are to what you can wear. They effectively have complete and total control, and any changes are theirs to make or not make as they see fit.

The companies of Berman and Greenbaum get to keep all the money their poker events make. They can use these events as they see fit; they can attempt to parlay them into other profit centers, or tie them in with their other properties. Berman's company derives all the economic benefit from the product he created; Greenbaum's employer derives all the economic benefit from the product they bought.

They have total control over their products and get to keep all the money they make, so why on earth should either of them (let alone both) give any of that up to participate in a national poker association? The thinking of many in the poker world is that these guys stand to gain little or nothing by participating in the creation of something that might require them to give up some of their profits or control. However, I believe both Berman and Greenbaum can see beyond that.

When the American League and National League, the AFL and NFL, and the ABA and NBA merged, the amount of money the owners and players made increased substantially: The whole was significantly greater than the sum of the parts. I think both Greenbaum and Berman can see the potential for a powerful poker league, with a centralized management negotiating contracts with television interests and sponsors. Does that mean they would have to share their money with each other and other participants in a national venture? Yes, it does. But, it also creates the potential for substantially larger amounts of money to be in play. Such a move could, should, and would result in more money not only for the companies of Greenbaum and Berman, but for the players, as well!

I have written before – and will at greater length in future columns – about the impact of the Black Sox scandal on baseball and the quiz show scandals on television. Both WPTE and Harrah's face a substantial risk related to integrity issues. It wouldn't take much more than a rogue dealer or a couple of smart scammers to create a poker scandal that would result in intense media attention and likely governmental intervention. (I have written extensively, and will again, about the impact of government on poker.) Furthermore, in the event of such a thing happening, the persons whose tournament results were negatively affected would likely seek redress through litigation.

By getting together with others in the industry to create an association, Berman and Greenbaum can shift the liability and responsibility relative to integrity issues to an impartial, neutral, self-regulating third party. This would minimize litigation risks, potential criminal issues involving the Justice Department, and oversight by securities regulators. This is one of the greatest things a national poker association has to offer Harrah's and WPTE.

But more money and risk management are not the only reasons for Berman and Greenbaum to cooperate in the creation of a national poker voice. There are economies of scale, whereby functions currently performed in-house at their expense could be shifted to the association, particularly in light of the fact that many functions are redundantly performed at both places. Marketing all of poker to all of America (and eventually the world) will yield a significantly greater return than individual marketing efforts.

Poker negotiating as a single entity with television networks and other entertainment vehicles, and with prospective sponsors, will generate more money at a lower cost.

There is significant momentum among other poker forces for a national association. By being part of its beginning, Harrah's and WPTE can ensure a paradigm that will protect their present interests and maximize their potential for future revenues.

Furthermore, by moving forward boldly now, they can pre-empt prospective competitors. By cooperating with other major players in Las Vegas, California, Mississippi, the East Coast, and so on, and of course the Internet, Berman and Greenbaum can reduce the risk of future competition. Bringing forces who might join against you down the road into your fold is the most effective means of dealing with them.

By working together, the poker world can substantially increase its market. I'm sure that both Berman and Greenbaum are familiar with the basic fundamentals of the poker economy. Live money busts out and dries up. Solid players and the expenses of the game suck cash out of the game. There always needs to be a steady stream of new players to support any given level of poker activity. Poker has historically been a boom or bust industry. We're going through the biggest boom ever now, but that doesn't mean there is no potential for a bust. By participating in a national association, Greenbaum and Berman can help ensure that the money continues to flow to all poker venues through the presentation of a unified marketing front with extensive reach.

I wrote once before about the fact that scuba diving is essentially unregulated at the state and federal level, because of the lobbying efforts of its national associations. Major League Baseball has its antitrust exemption. Football stadiums enjoy tax breaks across the country. They operate in a favorable environment vis-a-vis state and federal governments because they speak as an industry, not as a private entity. By banding together with others, Berman and Greenbaum can maximize the potential for a regulatory environment that favors their businesses.

The biggest reason for a national association that includes Berman and Greenbaum is that it's good for poker. And what's good for poker is good for them.

There are other arguments for the case that the WPT and WSOP are better served as part of an industry whole than continuing to operate on their own, but that's a pretty convincing list for starters. Yes, there is a cost to these companies to take this step, and they lose some control. They have to share the pie – a bigger pie. What there is to be gained far outweighs what there is to be lost.

I'm sure you can think of other benefits to the WPT and WSOP of helping to create a national poker voice. Send them to me at and I'll try to work them into a future column.

And if you happen to know somebody who knows somebody who knows either of these fine gentlemen, maybe you can slip them a copy of this column. And Mr. Berman and Mr. Greenbaum, if you happen to see this, thanks so much for helping us get where we are today. Here's hoping you'll be a part of making us even better tomorrow. spades

Roy Cooke played winning professional poker for more than 16 years. He is a successful real estate broker/salesperson in Las Vegas. If you would like to ask Roy poker-related questions, you may do so online at His longtime collaborator, John Bond, is a free-lance writer in South Florida.