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Industry News

by Brendan Murray |  Published: Jul 01, 2008

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UIGEA-Style Ban for Dutch
Reuters news agency reported in May that the Dutch Ministry of Justice has asked banks to stop providing financial transactions to online gaming sites in a move reminiscent of the Unlawful Internet Gambling and Enforcement Act in the U.S.

According to the report a list of up to 50 online sites was circulated to Dutch banks along with a request to stop services to these companies. A spokesperson for the ministry confirmed to Reuters that Unibet and Oranje Casino were among those being targeted. She added, "It is illegal to offer gambling services in the Netherlands without a permit. These companies know they break the law".

The Ministry said it would compile dossiers on the companies on the list and pass these to the public prosecutor to consider legal proceedings.

The Dutch parliament recently voted down a bill which would have allowed state-run Holland Casino open a legal online gaming site. The Netherlands is currently under intense scrutiny from the European Union, along with a number of other countries, for its protectionist stance on gambling. This latest move is likely to bring it to further attention in Brussels.

CryptoLogic Network Expands

A group of Scandinavia's leading Internet poker executives will launch a new online poker site, OPoker.com on the CryptoLogic network. The three-year licensing deal will see the software provider offer the online poker room customer support services, e-cash management, and business service support.

Brian Hadfield, president of publicly-traded CryptoLogic, said, "This announcement is consistent with our strategic imperative of adding liquidity and strengthening the CryptoLogic poker network within Europe, including Scandinavia. CryptoLogic's partnership with OPoker.com shows that even while we grow into other parts of the world, we're also expanding in our core European market."

Daniel Andersson, OPoker.com's CEO said, "CryptoLogic shares our vision of providing our players with top-quality poker software, tailored to local interests and cultures. Together, we will make OPoker.com a destination of choice for players across Scandinavia and beyond."

Sweden Jails Poker Organisers

Two men found guilty in a Swedish Court of organising an illegal poker tournament and have been jailed for six and eight months, respectively.

The court also fined two others the equivalent of 80 days' wages, while two more were cleared of all charges relating to the illegal tournament.

The two were sentenced by Uddevalla District Court, and the lawyer of the man who received and eight month sentence, Henrik Olsson Lilja, said an appeal was in the cards.

"We think the district court has gone too far with a prison sentence. A reasonable consequence might have been a suspended sentence coupled with community service," he told The Local.

The SEK 1 million (€106,000) tournament attracted 700 players in March 2007, according to authorities, but was broken up by police who deemed the activity illegal. Two of those charged were employed by the gaming company which sponsored the tournament and two were locally-based organisers, while the remaining two worked for the conference centre which rented out the hall for the game.

Discord at Svenska Spel
Gaming industry legal research group Gambling Compliance has reported that two more senior employees at Swedish gambling monopoly Svenska Spel have resigned in what appears to be a protest against a move away from competitiveness towards a more restrictive gaming model.

The move comes on the heels of the abdication of CEO Jesper Kärrbrink over irreconcilable management disagreements.
Elsewhere, Svenska Spel is threatening to sue UK-bookmaking giant Ladbrokes over an advertising campaign in Sweden promoting "Swedish Games, English Odds."

Swedish Games is a literal translation of Svenska Spel. The Swedish monopoly claims Ladbrokes is infringing its copyright by using its name and typeface in the ads.

iPoker Reports Record Profit
Playtech, the publicly-quoted gaming company based in Israel, has announced its revenues rose 97 percent in the first quarter of 2008 to $39 million from the same period last year.

iPoker, the poker network operated by the company, was a significant driver of growth, expanding by 161 percent in the same period to $11 million. The company said the iPoker network became the largest non-U.S. poker liquidity pool in the world during the first quarter of 2008.

"The increased liquidity has enabled iPoker to offer a record total of tournament prizes during March of more than $15 million, which included a single guaranteed tournament prize of more than $2 million," the company said in its key performance indicator statement. "The iPoker network will host the second European Championship of Online Poker on May 23, which will offer a total of $3.5 million in guaranteed prizes and involve 10 consecutive poker tournaments.

"In addition, development of the flash poker product has been completed and is under testing. Full release of the product to all poker licensees is expected to occur during Q3."

So far in 2008, the Playtech Group has added nine new licensees, including Betsson, one of the largest publicly-traded online gambling operators to the European market, and Vista Global Limited, the group behind the celebrity-endorsed Hollywood Poker brand.

888.com Confident of Strong 2008
Online gaming giant 888.com, which owns and operates Pacific Poker, has seen poker net gaming revenues grow 5 percent to $22 million in the first quarter of 2008 from $21 million in the same period of 2007. Growth also expanded by 2 percent on the fourth quarter of 2007.

The number of active customers in poker grew to 170,988, up 2 percent compared to the first quarter of 2007 and up 0.3 percent above the previous quarter.

Net gaming revenue per active customer reached $128 in the reported period, an increase of 3 percent year-on-year and up 2 percent on the final quarter of 2007.

Overall net gaming revenue across all platforms including casino and sports book was $64 million, up 38 percent on the first quarter of 2007.

CEO of 888.com, Gigi Levy, said, "We are delighted with our Q1 2008 results, especially given that we achieved further growth in the quarter well and above the unusually high Q4 2007. Our growth has continued into Q2, driven particularly by casino and bingo, and so far we have not experienced any impact of the historically quieter seasonal period. Our various business initiatives are progressing well, and we are therefore confident in delivering future growth during 2008."

Gaming VC Profits Up
Gaming VC, the online casino, sports betting, and poker operator has seen gross poker profit grow to €2.41 million in 2007, up 132 percent on 2006 when it was €1.04 million. Net revenue from poker was €3.42 million in 2007, up 55 percent on 2006.

The company launched a new poker brand PokerKings.com in December 2007.

Poker represented 8 percent of net revenues at Gaming VC in 2007. Casino contributed the largest share of revenues to the business which is marketed primarily to German speaking markets in Europe. Overall gross profit at Gaming VC increased 9.5 percent to €32.2 million in 2007.

WPT Revenues, Losses Grow
World Poker Tour Enterprises, producer of the World Poker Tour series of tournaments saw revenues up 10 percent between January and March 2008 to $5 million year-on-year. However, the company made a net loss for the quarter of $2.8 million compared to a net loss of $2.3 million in the 2007 period.

Hosting and sponsorship revenues increased by $900,000, largely as a result of international TV sponsorship revenues. In the same period, international television licensing revenues grew by 69 percent to $0.8 million as third-party distribution costs fell.

Online gaming revenues fell to $0.2 million in the quarter from $0.6 million in the same period of 2007 due to lower levels of player activity on the WPT site on the CryptoLogic network.

During the quarter, the company delivered seven episodes of season six to GSN in the U.S., which broadcasts the events, as well as continuing development of the WPT China National Traktor Poker Tour and a U.S.-based online poker site. Spanish and German-language online gaming sites are expected to launch in June 2008.

Steve Lipscomb, president and CEO of WPT Enterprises, said, "Our first-quarter results reflect the delivery of seven season six episodes, increased international television and sponsorship revenues, and moderate progress in our online gaming … businesses. We are excited about our prospects in 2008 and are confident in our ability to continue to expand the World Poker Tour brand, both in the domestic and international markets, and execute our strategic plan."
The company expects second-quarter revenues of $5.5-$6.0 million.

Everleaf Gaming Network Expands
Online poker site PokerTrillion.com has moved to the Everleaf Gaming Network. The site, which offers players 30 percent rakeback on demand and discounted live tournament entry, completed the move at the end of April.

Chief executive officer at PokerTrillion.com, Andy Pyrah, said, "It was essential that we joined a poker network that mirrored our enthusiasm and competitiveness streak as well as offering outstanding software.

Although we've moved we still fully intend on ruffling a few of our competitor's feathers by continuing to offer our hugely successful, and player rewarding promotions."

The Everleaf Gaming Network, is licensed and regulated by the Malta Lottery and Gaming Authority and was launched just under a year ago.

Spokesman Franz Gerhart said of the latest development for the network, "Month on month our network grows in terms of player traffic and new partners, attracting PokerTrillion.com has been somewhat of a coup as in the short amount of time that they've been operational they've shown that they have the potential to become a dominant force in online poker."

"Controlled Opening" for French Gaming
French Budget Minister, Eric Woerth, has told French newspapers that he plans to recommend to President Nicolas Sarkozy a "controlled opening" of the online gaming market according to press agency Reuters.

It is expected that plans for the opening up of the tightly managed state-run betting industry in France will be published before summer and that online companies could be operating there by 2010.

The country is currently under intense scrutiny from the European Union for its protectionist stance towards gaming.

Danes Move Toward Regulation
The Copenhagen Post has reported that the government in Denmark is proposing the end of state gaming operator Danske Spil's monopoly in the country in the wake of an EU Commission lawsuit against the country.

Government representative Anders Samuelsen says there is little point in continuing to protect the monopoly as it will almost certainly be lost in the face of the EU action anyway.

The newspaper reports Samuelson as saying, "Either the commission will come and take it away, or the monopoly will over time lose its footing as more players seek markets abroad. We must be able to guarantee that the money is still available and by selling licences to international gaming companies, a new source of income will be established."

Danske Spil has been the sole official gaming operator in the country since 1949.

Poland to Regulate Gambling
Poland is the latest country to consider regulating online gaming and betting with the second half of this year being targeted as the timeframe. The report comes in the wake of similar noises being made in Denmark and France over the last number of weeks.

The deputy minister for finance, Marek Kapica is working on legislative changes which he will send to the European Commission. He reportedly said, "We cannot control this process anyway and it is better that the budget at least derives some revenues from it."