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Poker club's anger at U. goes public
Published: 2005-02-01
 Poker club's anger at U. goes public
Deseret News (Salt Lake City), February, 2005 by Linda Thomson
Two brothers who run poker tournaments from a converted warehouse just west of I-15 in Sandy have raised the stakes in their fight with Utah's largest public university.
Matt and Ryan Nadeau took their complaints about the University of Utah to media Wednesday in a news conference about their lawsuit against the university. They charged university administrators gave them little notice when they canceled an alleged agreement to hold a Texas Hold'Em-style tournament at the student union Tuesday and Wednesday.
University of Utah administrators said they canceled near to the tournament's start date because that's when they found out about it.
"A number of us in the administration and myself included, in consultation with the students, just felt the idea of a commercial poker game for U. students was a bad idea on the face of it and we shouldn't be promoting poker on campus as a student event," said Fred Esplin, university spokesman. "Frankly, it was a mistake that it got as far as it did."
Poker club members had negotiated with the ASUU presenter's office, which runs many events on campus, and the student union before the issue made its way "well into the process" to the university administration, Esplin said.
The Nadeaus planned on charging students $20 to join the tournament, but they also wanted to raffle prizes as an incentive to participate. They could not award monetary prizes for game winners because Utah law prohibits gambling, which is defined as risking something of value in a game of chance to win something of value. Take away one of those elements -- such as prizes for winners -- and it isn't gambling, Ryan Nadeau said.
Big SLC Poker Club is seeking $350,000 in damages, including compensation for its loss of customers, trade, business and reputation at the event that club members anticipated would have drawn between 3,000 and 5,000 students, according to the civil lawsuit filed in 3rd District Court on Tuesday.
The suit states the university had five months to negotiate terms for renting a ballroom in the Student Union Building on Feb. 22-23 as well as other arrangements, but the university told the club on Feb. 16 that the event was off.
The suit alleges that by that time the club had arranged for workers, sponsors, ballroom use, advertising, food service and prizes redeemable at the University Bookstore, as well as a one- semester scholarship.
"In five months, literally, at any time they could have said they didn't want it," Matt Nadeau said Wednesday morning at his club. "The most frustrating thing is the timing."
Esplin said he's aware the club has claimed it was damaged by the university's actions.
"We did offer to reimburse them for their direct costs and their advertising. We offered it and they sued us," he said. "In fairness, they placed some ads in the (Daily Utah) Chronicle and placed some posters, and we felt it was not unreasonable to" reimburse the costs.
It is unusual for outside businesses to come to the university and charge students to participate in activities, said Emily Justice, director of the ASUU Presenter's Office. Justice worked with the Nadeaus on the tournament.
"When I found out about the event, I didn't think it was something we wanted to support, having an outside vendor come onto campus and walk away with the money and getting a discounted rate for rental of the student union," said Alex Lowe, ASUU president. "If students want to gamble that's their choice, but it's not something we want to promote."
The Nadeaus started their club in July 2004. The cavernous room it occupies includes folding tables and chairs for games, a big screen television and two couches. They run tournaments Thursdays through Mondays almost every week, Ryan Nadeau said.
The club received an "illegal use of land" ticket last week from Sandy city for running tournaments in its leased space in an area zoned for industrial uses, according to Nick Duerksen, the city's assistant community development director.
Duerksen said the club's business license and the area's zoning permits retail sales of gaming equipment but not poker tournaments.
E-mail: kswinyard@desnews.com; lindat@desnews.com
Copyright C 2005 Deseret News Publishing Co.
Provided by ProQuest Information and Learning Company. All rights Reserved.
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How poker websites hold a winning hand Evening Standard (London)
Published: 2005-02-01
 How poker websites hold a winning hand
Evening Standard (London), February, 2005 by ANGUS MCCRONE
EDWARD G ROBINSON outwitted Steve McQueen in The Cincinnati Kid with a hand of the eight, nine, 10, jack and queen of diamonds. Through a dense cloud of cigarette smoke, Robinson's character, Lancey Howard, drawled: "You're good, kid, but as long as I'm around, you're second best."
Few activities have stayed as popular, and yet changed as radically, as poker in the 40 years since that classic film was made. For a start, poker is now big business. It has moved to the verge of the top division of the quoted company arena, at least in London, and is making huge profits for its organisers - not just for a few top players.
The game itself has also undergone a metamorphosis. The five- card stud favoured in The Cincinnati Kid has been superseded by more flexible variants such as Texas Hold 'Em, and poker has become an even bigger pastime online. A smoke-filled room and sweaty spectators are no longer necessary.
The question facing analysts and investors is whether this boom is part of a long-term growth trend, whether it will soon give way to a plateau or whether it will be exposed as a temporary craze.
The statistics are striking: according to independent website Pokerpulse.com, the number of people playing online poker worldwide was 1.78 million in January, and is growing by 10% a month. In the past two years, the industry has grown 15-fold.
Dennis Boyko, chief executive of Pokerpulse, says: "We can't expect to see 1400% growth over two years ever again, but I think there are a few more doublings left.
There are two million active online poker players but 100 million people who have played conventional poker at some time."
Providers of the online game make their money with a small "rake" from the pot in each game plus, to a lesser extent, tournament fees. This has powered hefty increases in sales and profits.
Paradise Poker, the US-focused firm bought for Pounds 169 million by Britain's Sportingbet last autumn, had turnover of $37.2 million (Pounds 19.7 million) in the seven months to July 2004, and profits of $21.3 million.
PartyGaming, the sector leader with a share estimated at 50% of the overall market for its Partypoker offshoot, is believed to have made profits before interest, tax, depreciation and amortisation of more than $350 million in 2004. If it floats on the London Stock Exchange, as it is considering, it would be likely to command a market value of more than Pounds 2 billion and be a candidate for inclusion in the FTSE 100 index.
Online poker is already represented on the UK stock market through Sportingbet, William Hill and Hilton, owner of Ladbrokes, the second-largest poker-room operator in Europe. It had 33,000 active customers last summer and Hilton says profits doubled in the year to June 2004.
Another British firm now moving in aggressively is Betfair, the privately owned, Fulhambased betting exchange.
Ben Fried, head of poker at Betfair, says: "Online poker is a skill game, rather than a luck game, and that attracts many players.
People also like the fact that it is anonymous, not face-to- face. You don't have to look like Steve McQueen."
Interest is building on the back of American TV coverage of conventional poker matches and publicity about the millions bagged by tournament winners in Las Vegas. Closer to home, Fried says one notable win was an Irish scaffolder's $26,000 prize in a tournament last autumn.
The reality, of course, is that there are more losers than winners. Still, the industry's growth has enabled a small number of people to try to earn their living out of online poker. One of these is Russell Cowley, a 33-yearold former sales and marketing man who learnt the game playing in pubs and clubs in his late teens.
His poker name is Ariston, because at one tournament, he talked on and on and on.
He says: "The online version is very different from face-to- face. It is much faster and you have to play more mathematically. However, it is not just about judging the probabilities - you can keep notes on other players and how they play, and use that to help you decide when to make What do the sceptics say about internet poker? Many thought Sportingbet overpaid for Paradise Poker last autumn, but the conventional wisdom now is that it got a good deal. Its shares have surged from 100p to 269p in the four months since.
But there are risks. One is that US law is at best ambiguous, and at worst hostile, to online gambling and it is impossible to rule out a clampdown by authorities. All the main poker providers are careful to base their operations outside America. Betfair even refuses to accept US-based clients.
A second risk could yet be negative publicity, perhaps over addiction.
Mark Griffiths, professor of gambling studies at Nottingham Trent University, says: "With online poker, you can in theory play all day every day. You are gambling with electronic money and that is a potential worry because people tend to be bolder with that than with real cash."
But he adds: "The genie is out of the bottle and will not go back in. Most responsible operators will do their best to make the product as safe as possible for their customers."
Another potential risk for investors is a price war, with new operators offering free or almost free poker rooms.
City fans will hope, however, that critical mass, the power of the brand and the lure of tournaments will keep customers loyal to the established firms.
Spawning a new breed of game
THE most popular species of poker online, Texas Hold 'Em, can involve any number of players from two to 22, although somewhere between eight and 11 is normal.
The main difference compared with the old-fashioned game is that it ends up with five open cards on the table usable by everyone - a "flop" of three cards, plus two others called Fourth Street and Fifth Street.
All players receive just two additional, hidden cards and make their bets on the basis of these two plus three from the "flop", one hidden card plus four from the table, or even all five from the table.
The faces making a name for themselves
MIKE SEXTON is the poker face. Let's rephrase that: Mike Sexton is the face of poker. A former professional player and commentator, he is now the grinning, tuxedo-clad frontman for PartyPoker.com, the world's biggest online provider.
His fame and omnipresence - one source describes him as the Gary Lineker of the card game - contrasts with the low profile of the other key individuals at Party Gaming, the parent company of PartyPoker.com.
The firm was founded by Ruth Parasol, an American lawyer, and Anurag Dikshit, a software specialist from India. Parasol remains a shareholder but is no longer involved on an executive basis.
Now the Gibraltar-based firm is run by chief executive Richard Segal, a British executive best-known for spearheading the sale of Odeon cinemas to German bank WestLB in March 2003, for Pounds 431 million.
Given the unfriendly attitude of the US authorities to online gambling, the firms are often based in exotic locations such as Costa Rica - in the case of Poker Stars, the second-largest firm, and Paradise Poker. Their servers are often based in even more bizarre places: Paradise hardware runs from the Kahnawake Mohawk Indian reservation in Canada.
Paradise was bought by Sportingbet of the UK for Pounds 169 million last October without revealing the identity of its owners, who got 56 million shares as part of the deal. This shyness is quite typical among the privately owned firms in the industry.
Most companies, however, have wellknown names with job titles such as poker room manager. This role, at Poker Stars, is taken by Lee Jones, a former computer engineer who became a professional poker player and is author of a book called Winning Low-Limit Hold 'Em.
Europe's biggest poker room, apart from PartyPoker, is run by Ladbrokes, the gambling subsidiary of the publicly quoted Hilton Group headed by chief executive David Michels.
Ladbrokes sponsors a professional poker player, Roy "The Boy" Brindley. The company says: "In this role, he provides consultancy advice to the Ladbrokes poker managers, as well as playing regularly under his own name."
Finally, the most important question: who is the world's top poker player?
There are so many events that several players probably have claims to this title, but the 2004 World Series of Poker champion was Greg "Fossilman" Raymer.
The burly patent attorney from Stonington, Connecticut, won $5 million at the event at Binion's Horseshoe Casino, Las Vegas, last April.
The top-placed Brit was Londoner Gary Jones who collected $175,000 just for finishing 17th.
(c)2005. Associated Newspapers Ltd.. Provided by ProQuest Information and Learning Company. All rights Reserved.
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