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Industry News

by Brendan Murray |  Published: Nov 01, 2010

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888 Holdings, the Israeli-owned gaming operator, which owns 888 Poker, has reported first half 2010 poker revenue down 25.2 percent to $19.6 million. This compares to $26.2 million in the first half of 2009. No other key performance indicators were reported by 888 but the company said, “Trading in August has been significantly stronger than in July, with a double digit daily revenue increase especially in casino and poker. Boosted by the release of the new platform, Poker has seen an increase of more than 15 percent in revenue in August.” Gigi Levy, chief executive officer of 888, said, “Our business experienced a difficult first half against the backdrop of a challenging economic environment, with trading impacted by a number of factors including general online poker weakness, adverse F/X movements and, in relation to Poker and Casino in Q2, the FIFA World Cup.” The first half of 2010 was a busy year for 888 in the poker market as it re-coded its poker client, opened an online loyalty store, received a license to operate in France, and acquired social gaming studio Mytopia. Total operating income at 888, which also operates bingo, casino, sportsbook, and a business-to-business unit, was up to $130.2 million in the first half of the year from $117.9 million a year earlier, while profit before tax was down to $8.4 million from $14.9 million.

Entraction Poker Revenue Down 31 Percent
Poker revenue at Swedish network, Entraction (described as gaming surplus in its accounts) fell 31 percent to SEK72 million (€7.64 million) in the second quarter of 2010 compared to SEK104.8 million (€11.12 million) in the same period of 2009. Poker net sales for the quarter were SEK47.8 million, a decline of 36 percent compared to SEK75 million in the second quarter of 2009. Net sales for the first half of 2010 amounted to SEK111.1 million, down 30 percent on the SEK159.4 million achieved a year earlier. Expressed in euro and taking into account the closure of Cardroom2 on the network, net sales for the half-year fell by 23 percent compared with the previous year. The company described the conditions responsible for the various declines in its latest financial statement, saying, “In addition to the seasonal decline, the economic situation in Europe has also caused a general decline in the number of active poker players. The FIFA World Cup also meant a certain shift in sales from other products to betting. “Our royalty income from poker is increasing steadily and we see continuing positive development for our business model as supplier of technology for poker. We are maintaining good liquidity in our poker network and see many opportunities to achieve growth in the number of players. “The number of active players on the network has increased compared with the same quarter the previous year, although there has been a decline in player yield. An activation programme has therefore been implemented in order to boost the number of active players and the yield per player.”

Blanca Games Takes Over Cereus Poker Network
Blanca Games, Inc. has announced the acquisition of the Cereus Poker Network which includes Absolute Poker and UB.com. The terms of the acquisition have not been released, but the Kahnawake Gaming Commission has given Blanca the green light to complete the deal and begin operating the Cereus Poker Network. Chief executive officer of Blanca Games, Stuart Gordon, said, “From our perspective, we have acquired a large, sophisticated online gaming operation with state-of-the art capabilities, ranging from compliance to business intelligence to online marketing to customer service. We see a tremendous growth opportunity in this deal and beyond, as Blanca seeks additional acquisitions in the market. “We expect no changes in the playing experience on the Cereus sites, except for the improvements that will likely be the long-term result of this transaction… We intend to leverage the existing strengths of the Cereus Poker Network, particularly in the areas of security and customer service. Although we are impressed with many of the new security features on the Network today, security is and will remain our top priority. “We’re also pleased with the efficiency and the player-friendly approach of Cereus’s customer service operation, but we will always be seeking to improve in this area.”

PokerStars Signs Sponsorship Deal With French TV
PokerStars.com has signed a sponsorship deal with French TV channel Canal+. The company recently moved into the newly regulated and licenced French online poker market and began its sponsorship of select sports coverage on the TV station with the Basketball World Championships, which took place in Turkey in August. In May, PokerStars announced its sponsorship of the Spanish national basketball team who were taking part in the tournament. The deal will also see the poker room focus heavily on sponsoring tennis coverage including the U.S. Open, and London and Shanghai Masters.

Poker Revenue Falls Eight Percent at Playtech
Playtech, the Israeli-based owner of the iPoker network, saw poker revenue decline eight percent to €15.8 million in the first half of 2010 compared to the same period of 2009 when it was €17.3 million. The most recent figure is also down 5 percent on the previous six months, July to December 2009, when it stood at €16.6 million. Poker makes up 18 percent of Playtech’s gross income compared to 56 percent for casino, five percent bingo, William Hill Online 17 percent, and other sources four percent. The company, which also operates casino and bingo products, saw gross income up 31 percent to €87.9 million. The first half of 2010 saw the company launched its poker product in the newly regulated French market and last year poker revenue increased 12 percent.

Dutch Commission Urges Online Poker Regulation
A commission set up by Dutch Justice Minister Ernst Hirsch Ballin to review the country’s position on online poker has urged the government to “give up its barely-enforced monopoly and licence a small number of online poker companies”. The move would prevent non-Dutch online poker companies from targeting players in the country, and Internet service providers would have to block access to their websites, according to the report from the commission. Earlier this year a Dutch court ruled that live poker tournaments could take place at venues other than those casinos owned by Holland Casinos.
It now remains to be seen whether the minster who convened the commission will accept its recommendations.

Online Poker Banned In South Africa
A South African high court has ruled all forms of online gambling, including poker, are illegal in South Africa. As a result of the North Gauteng high court ruling the Gauteng Gambling Board said online casinos and poker rooms offering services in the country are now open to prosecution. Head of legal services for the board, Lucky Lukhwareni, said, “… we approached the media to alert them of the judgement which makes online casino operations illegal, and if they continue we will have them arrested and fight for conviction.” Online gambling operators and players in South Africa could now face fines of up to R10 million, 10 years in jail, or both.

PokerStars Moves Into Estonia
PokerStars.com has been granted a license to operate an online poker site in Estonia. The Estonian Tax and Customs Board has issued the license after a period of due diligence, and the company is among the first operators to receive a licence in the newly regulated market. PokerStars has recently been active in Estonia hosting the European Poker Tour Tallinn as well as sponsoring the country’s national volleyball team. Tomas Larsson, PokerStars Baltics country manager, said, “Applying for a license is always a complicated process and I am therefore very happy that PokerStars has successfully met all the necessary criteria to obtain an activity license in Estonia. “In addition to Estonia having excellent players and tournament organisers, Tallinn is also a new and truly attractive destination for many top players.”

bwin Poker Revenue Saved By Italian Market
bwin Interactive, parent company of bwin poker and the Ongame poker network, saw gross gaming revenue from poker jump 21.1 percent in the second quarter of 2010 to €32.5 million compared to €26.9 million in the same period of 2009. However, the figure includes revenue for Italy’s Gioco Digitale, which the company bought last year. If figures for the Italian market are stripped out, poker fared less well at bwin, dropping 14.5 percent to €23 million. For the first six months of 2010, gross gaming revenue in the poker segment grew by 21.8 percent to €70.6 million compared to €58.0 million in the first half of 2009. Again, excluding Gioco Digitale, revenue fell 16 percent to €48.7 million. The company said, “Amongst other things, this decline was attributable to the Soccer World Cup, which channeled customer interest strongly towards sports betting, and continued stiff competition, particularly from poker providers still offering real money gaming to US customers. Due to the large number of US poker players, they have significant benefits in size with respect to player liquidity as well as financial advantage.”