Black Friday and its aftermath have had quite an impact on the US gambling market, poker in particular. The regulations which forced some of the biggest poker sites to leave the United States caused numerous problems, financial and otherwise, for sites and players who depended on the poker income. But it also left a big gap waiting to be filled once the required regulations are passed and the climate becomes more favorable. During the last year or so, things started to change for the better from that perspective, with a couple states passing acts and regulations pertaining to the issue of online poker. These changes also meant that the big players would start their race to grab the biggest share possible before the competition. Overall, it created an interesting climate!
As things stand right now, growth possibilities seem nearly endless. The US poker market has always been a huge part of the overall poker economy, meaning that there should be many people anxiously waiting to see the ability to play online restored. But this is theory. It is somewhat different in practice, as only three states have actually signed the bills regulating online poker thus far, and even with further per-state acts, what is really needed is a federal law enabling interstate poker and, eventually, the exit to the global market.
Only Delaware, New Jersey and Nevada are offering regulated markets. Together, these three states have a combined population of over 12 million people, which represents just 1/30 of the US. Sure, there will be states that never get around to regulating online poker. But you also have places like California (38m people) that are rumored to be within a year or two of legalization. And that would be a huge boost to the internet poker economy. www.pokerus.com
Passing regulation in a state with the population of California would certainly be a huge boost to the poker rebirth in the states, and if rumors are true, we won’t have to wait long for it to happen. Big companies like PartyPoker and Caesars got their feet wet, jumping at the opportunity to get in on the ground floor and use the mainstream media to get the word out about their latest products. These investments are quite a gamble, as they are counting on the fact that the majority of states would eventually pass bills regulating online poker and enabling an interstate conjecture that would bring together millions of potential customers. Thus far, the numbers haven’t been quite impressive.
Economy in Recession
Apart from the complicated legal situation, there is another fact not working in favor of the growth, as the US economy has been in recession for some time now. A shortfall of available funds with potential players has never been a friend of the gambling industry. As Brian Miler explains in a video from bloomberg.com from April 9th, the new online casinos are, in fact, cannibalizing each other as the market is not what it used to be. Not only that, there are less and less available jobs, but in general, hourly wages have decreased, influencing the overall income and the ability of people to gamble.
Diversification of business has been successful for the land-based casinos, as they turn more towards the entertainment industry, shopping and similar. This, however, is not an option for the online casinos and, particularly, poker rooms, as the games they offer are more or less all there is. So, once again, quite big investments in setting up the necessary infrastructure as well as marketing costs could become hardly recoupable overhead.
With all this in play, PokerStars has been working relentlessly to try and enter the US market. The company seems quite determined to get in on the action before other players are able to grab the majority of customers. For Stars, once the most important online poker provider in the states, this is a worthwhile gamble, as they probably don’t mind waiting a couple of years for things to pan out if necessary. Their return has been complicated by legal matters dating back to Black Friday, but in the meantime, they are doing all the preparatory works.
While there has been no final partnership entered into, PokerStars has announced that it has a tentative partnership with some powerful gaming companies. These companies feel that past history should not prevent the poker company from participating in the US gambling market. The group of gaming companies that PokerStars may partner with are the cardrooms, Bicycle Club, Commerce, and Hawaiian Gardens, along with the Morongo Band of Mission Indians. compatiblepoker.com
Numerous parties have voiced their concerns that, should PokerStars be allowed to enter the market, they would easily push other companies aside. On the other hand, with their experience and undisputable success in the industry, it is a safe guess that they would do great things for the expansion and popularity of online poker in the market that has been deprived of it for some time now.
Down the Road
Giving a good estimate of the future development is quite a task at this point. It is nearlly impossible to compile all the relative legal, financial and other information to come up with a realistic expectation for the next year or two. As far as the poker community goes, there are those who believe that it would never be the same and that online poker will never recover from the blow it received. Some of them see a reliable Bitcoin-based room as the only solution.
Others believe that with enough initiative and activity, politicians will come to see reason and we will see a full scale regulated poker scene in the states. There is no denying that this would boost state revenues, but there are other factors in play hindering the process.
Overall, there is plenty of space and potential for growth, but there are also numerous obstacles along the road. How things will play out will depend on how all the factors mentioned here, as well as some others, come together. Every poker fan and professional would love to see the return of the United States to the global stage, but it isn’t out of the realm of possibilities for the game to become a scapegoat of political and other disagreements.
We should definitely see some growth in the near future. Regulation in California and potential interstate agreements with New Jersey, Delaware and Nevada could create a decent player pool, so that’s something to look forward to. WSOP will also bring a lot of players to Las Vegas, which should not only bring some fresh blood directly, but could potentially reignite interest for poker with all the publicity surrounding it.
Where things will go from there, we’ll just have to wait and see. Calculating odds on this one requires much more than simple math!