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Chips are down for online poker sites
Published: 2005-09-23
 by Jason Walsh
After a year of flush profits, online poker sites are beginning to see the lustre come off their profits. Is what seemed like a solid bet just a year ago set to fold, and will 2006 be the beginning of the end for online poker?
The profits are high, but the stakes even higher. Recent activity has indicated a potential downturn in the online poker market with PartyGaming, the world's biggest online poker company, losing 33 percent of its share value in early September. The online gambling firm cited a decline in the online poker market as the reason for its poor performance.
PartyGaming floated on the London stock exchange this year and has seen its value rise to STG6.34 billion. Despite its high-profile decline in recent weeks the Gibraltar-based firm is due to enter the blue-chip FTSE100 in September.
In the meantime, rival 888.com cut its proposed flotation price on 15 September as a result of investor scepticism towards online gambling. 888.com is seeking a market capitalisation of between STG546 million and STG715 million, down from an initial valuation of STG800 million.
Despite the downturn and lowered figures, the number of online poker players remains huge. Industry sources claim the online gambling audience in the UK has increased by 45 percent over this time last year, with 3.2 million people visiting a gambling site in February 2005. Most online casinos put part of their success down to the fact that a "poker face" -- the ability to hide one's emotions while playing -- is not necessary when your adversaries are unable to see you. Less frequently mentioned is that, for some people, gambling remains a taboo, even in countries like Ireland where it is relatively common.
Punters in the UK have embraced online gambling and the media has been quick to cash in on the boom. The Racing Post has seen circulation soar and Sky Digital hosts a dedicated poker channel. The Poker Channel is clearly targeting online players, featuring practical programmes such as the Poker Godfather: "Each week we send a poker professional (the poker Godfather) to an online poker player's home and turn their poker game upside down."
Meanwhile, Ireland is not far behind in the online poker stakes and Irish firms have been keen to cash in on the gambling boom at home and abroad. Belfast-based AVA Leisure recently launched, in association with Paradigm New Media in Comber, Co. Down, DV8Poker.com, licensed by the Kahnawake Gaming Commission in Quebec.
When it comes to competing with established brands, DV8Poker.com's strategy is to make the most of advertising: "We do pay-per-click advertising and that's a great leveller," said Sherril McCahon, a partner in the business. Despite being based in Northern Ireland the company is eyeing international markets.
"We've had our splash page translated into Far Eastern languages. If you look at [search engine] Alexa, the biggest traffic drivers to 888.com are Far Eastern sites," said McCahon. "At the moment, with the growth, there seems to be enough business out there for everyone."
Meanwhile, Irish bookmaker Paddy Power has seen its online profits outstrip its traditional business. Non-retail businesses accounted for 63 percent of its EUR17.8 million profits in the six months ending 30 June. In the first half of 2005, Paddy Power.com had 47,000 sterling customers and 27,000 euro customers.
Paddy Power, head of communications at the bookmaker said: "I've no doubt that it'll settle down [but at the minute] poker is such a sexy word. There's been a lot of media attention."
For its Irish customers, name recognition is an issue: "In Ireland everyone's heard of Paddy Power, they've seen our bricks and mortar shops and they know that we'll not be gone in the morning," Power explained.
But despite the media flush, all is not well in the world of online poker. Inside Edge, a UK gambling magazine was launched by Dennis Publishing in 2004 with a target circulation of 30,000 copies. However, ABC figures from 2005 show the magazine sells a mere 15,112. It seems that the amount of chips in the pot does not translate directly to sales of gambling related media. Despite the disappointing performance, Dennis has pushed ahead with the launch of Total Gambler. The 22 September will see Dennis launch another title, Poker Player.
The situation in the US is heating up at the moment. While online gambling has not been legalised in the US, a number of gambling sites exist but these are operated from offshore or overseas locations and have been deemed legal.
There have been moves of late to have a nationwide ban on internet gambling in the US. On 15 September the US Senate rejected an attempt by Republican, Jon Kyl, to ban internet gambling across the country. Kyl remains determined to pass the legislation, which was overturned in a technical manoeuvre.
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Al Ardebili Captures World Poker Tour Title at Borgata Poker Open
Published: 2005-09-23
 ATLANTIC CITY, NJ -- (MARKET WIRE) -- 09/23/2005 -- Six players entered the Borgata Event Center last night, one left a champion. The marquee event of the 2005 Borgata Poker Open lived up to its hype and supplied spectators with some of the most intriguing poker play on the WPT to date.
Jersey City's Al Ardebili captured the title and first-place prize of $1,498,650 after he beat Margate, N.J.'s Richard Festejo in the final hand. Both New Jersey natives won their buy-ins into the WPT finals via Borgata Super Satellite tournaments earlier this month, after participating in $300 and $1000 events respectively. Taking an enormous chance, Festejo risked his chip stack on a bluff with only a seven and eight of hearts and was quickly rebuffed when Ardebili called with his ace of hearts and nine of spades. Unfortunately for Festejo, who had started the final table with the shortest stack, neither the flop, turn, or river offered any help and Ardebili eliminated him with only ace high. Festejo earned $799,280 for finishing second.
Kathy Liebert reached the highest spot for the ladies, finishing third and collecting a cool $427,115. She was joined in the money by fellow female standouts Evelyn Ng, who finished 11, and Clonie Gowen, who finished 31.
Celebrities, poker stars, and local "home-game heros," all saw action on a level playing field at the 2005 Borgata Poker Open, as players came from all over the world for a chance at the WPT title.
WPT announcer and star player in his own right, Mike Sexton, applauded Borgata and explained that the property has the key ingredients to make the perfect mix of atmosphere and great game play that has become the calling card of Borgata. "Borgata is the perfect fit for the WPT because a: it's a very classy and elegant casino property, b: it's the finest property in Atlantic City, and c: the WPT truly has the greatest venues in the game and it's only fitting that our East Coast stop here in Atlantic City is Borgata."
With almost double the players of last year's series, the 2005 Borgata Poker Open broke attendance records and rewarded more money than previous Borgata Poker Open events. The WPT main event, featuring a prize pool of over $5 million, was the biggest tournament in Atlantic City's history. The series also featured a 500-player Ladies Only event. Next year's Borgata Poker Open will be held in the casino-hotel's expanded 85-table poker room, part of a $200 million expansion project which will provide guests more gaming space, dining options and entertainment experiences, expected to debut in spring of 2006.
About Borgata Hotel Casino & Spa
Located at Renaissance Pointe in Atlantic City, it features 2,000 guest rooms and suites, 125,000 square feet of gaming, 11 destination restaurants, 11 retail boutiques, a 50,000-square-foot spa, 70,000 square feet of event space, and parking for 7,100 cars.
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