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Zynga Confirms Withdrawal of Nevada Online Gambling License

Zynga has withdrawn its application for a licence to provide real-money online poker in the US state of Nevada for reasons that are not yet fully clear.

It comes almost ten months after the company applied for a licence to launch a real-money online poker site in Nevada. However, there were indications that Zynga had changed their tune on operating an online poker service in the US as far back as July.

That was when the company’s second quarter earnings report was released and it stated that Zynga was aiming to put a stop on its previous plans to pursue any real-money online poker operation in the Silver State.

Those intentions appear to have come to fruition as it was discovered that an entry on an upcoming Nevada Gaming Control Board agenda stated that Zynga has placed a “request to withdraw application.”

Zynga CEO and co-founder Mark Pincus stepped down from the company’s top job in July and was replaced by tech gaming guru Don Mattrick. The 49-year-old is known more for the arcade side of gaming, having previously worked at Microsoft, where he oversaw the company’s Xbox 360 and PC gaming businesses.

That may have sealed the company’s ultimate decision to withdraw their application to offer a real-money online poker service in Nevada. It may also be a sign that the company may aim to focus its resources on enhancing the quality of its existing free-to-play entertainment games instead of pursuing real-money gaming.

The change of heart by Zynga comes during tough financial times at the company. Zynga reported revenues of $231 million in the second quarter of this year, a massive 31 percent decrease year on year and net losses of $16 million.

Zynga also announced a number of cost-cutting measures in the middle of the year, including slashing around 20 percent of its staff. Other cost-cutting measures include the closure of at least eleven games by the company, along with the removal of a number of its other games from app stores.

Nevada is a small state in terms of population, which could have also influenced the move to not pursue a poker service there. The two sites that currently operate in the state, WSOP.com and Ultimate Poker, average a combined total of just over 200 users, which shows that the player pool in Nevada is small.

It is an investment that may not have been worthwhile for Zynga during a time when it seeks to find ways to turn its recently dwindling fortunes around.

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