Publicly Traded Online Poker Stocks
Publicly traded online poker sites are increasingly commonplace and widely viewed as a great investment because of the increasing popularity of Poker Online. Some of these publicly traded poker companies' revenue comes completely from their online poker games. Other companies have online poker as just a small part of their revenue. These companies usually have other sites dedicated to online casino gaming. Online card rooms have been listed on various international stock exchanges for about a decade. They compete with privately owned companies who do not have to follow the same regulations. A public company means a company that is allowed to offer its stock and bond securities for sale to the general public, this is usually done through a stock exchange.
Most of the parent companies for online poker rooms trade on the London Stock Exchange. A few of the publicly traded poker stocks trade on the NASDAQ. A single online poker stock is traded on each of these markets, the Toronto Stock Exchange, the Stockholm Stock Exchange, and the Vienna Stock Exchange.
Recently, the United States passed the Port Act which had a big effect on all of the publicly traded poker companies. The Port Act, which was passed at midnight the day Congress adjourned for the 2006 elections, was a must pass port security bill that did not ever get debated. Included in the Port Act, was Title VIII or the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). The UIGEA prohibits money transfers from a financial institution to an Internet gambling site, except those related to fantasy sports, online lotteries, and horse racing.
The UIGEA blind sided poker rooms, causing immediate drops in share prices. For example Party Gaming's stock dropped 60 percent in 24 hours. All publicly traded poker rooms were forced to leave the United States market and most of the e-wallets (online banks) that transferred funds between the players and the sites closed their doors to the US. Because the US player base made up for a large percentage of the online poker players, these companies all suffered considerable financial losses. In the short term, privately held companies who stayed in the US market saw a huge influx of new players. Which was about to go public with an initial public offering (IPO), held off on doing so after the UIGEA passed and has since risen to the number 1 poker room in the world overtaking the publicly owned Party Poker. Recently, efforts to reverse the UIGEA are underway and it's likely the return of these companies to the US market will happen in the future with government regulations.
Publicly traded online gambling sites have the advantage of being able to raise additional capital in a short amount of time by issuing stocks and bonds. Publicly traded companies will likely use their capital for acquisitions and mergers with competitors. The size of an online poker room is its strength. Players migrate towards online poker sites that have a large player base so they can enter larger prize pool tournaments and can easily find an available cash game at the limit they want to play. One recent merger was between two top 10 online poker rooms, UltimateBet and Absolute poker. After the merger, they still operate two different rooms but have integrated their management. Another type of acquisition that may become more commonplace is online casino gambling or sporting bet sites adding online poker rooms to their product lines. For example, Sportingbet's acquisition of Paradise Poker that added a major poker room to Sportingbet's popular sports betting and casino game site.
Expect major revenue increases for publicly traded online gambling sites to be the idea of cross marketing their products. Having online casino patrons playing internet poker at their sites while having the poker players try casino games and sports betting. Publicly traded companies face pressure from investors to maximize revenue and cross marketing casino table games, sports betting, poker, slots, and more to a targeted market will satisfy investors that the gambling site is being opportunistic. For example, the struggling World Poker Tour Enterprises licenses their online poker room software from CryptoLogic, and have recently added CryptoLogic's top 10 casino games including the mega-progressive slot, Millionaire's Club, which has paid out several multi-million dollar jackpots.
Branding is very important to online poker rooms. Investors realize that the barriers to entry for start-up poker companies are relatively low and smaller companies can catch-up to the larger rooms easily by quickly attracting players through promotions and advertising. In order to attract investors, poker rooms need to show that they are not likely to lose their market share to other poker rooms. The successful companies increase brand recognition of their poker rooms through good advertising, solid reputation, and unique promotions like the Party Poker Million and Ladbrokes Million tournaments. Additionally, an improved online poker product through research and development of online poker room software that adds increased game speed, better graphics, and better game play can quickly show a return on investment when positive poker room reviews and word of mouth attract new players.
Ladbrokes Stock Analysis
A major player in the online gambling world with more then a half a million active gamblers, Ladbrokes is best known for their sports betting and for being home to one of Europe's online poker rooms, Ladbrokes Poker. Ladbrokes sports wagering is done via the internet, the telephone, or through almost 3,000 sports book stores in the United Kingdom, Belgium and Ireland. Additionally, gamblers have the option of playing in their wide selection of casino style table games. The Ladbrokes Poker room gains international recognition each year from the real life high stakes Ladbrokes Poker Million tournament.
Ladbrokes PLC claims that it is the world's leading fixed odds betting company. Before Ladbrokes PLC became the parent company, it was part of the Hilton Group which had the rights to the Hilton Hotel brand outside the US. When the American branch of the Hilton Hotel acquired the hospitality part of the company in February 2006, the remaining gambling business was renamed Ladbrokes PLC. After the sale, its listing on the London Stock Exchange dropped from the FTSE 100 Index (100 largest companies on the exchange) to the FTSE 250 (top 250 companies on the exchange). The financial data for 2005 showed earnings of 195 British Pounds amounting to around 12.3 British Pence per share.
With the main competitor within the United Kingdom being William Hill which essentially offers the same products and services, Ladbrokes has begun expanding its other interests like partnering with the Chineses government to create the first Chinese lottery. The Safe Port Act did not really effect Ladbrokes as their online poker room never allowed US players.
Ladbrokes Company Information
Address: Imperial House, Imperial Drive, Rayners Lane, Harrow
HA2 7JW, United Kingdom
Phone Number: +44-20-8868-8899
Fax Number: +44-20-8868-8767
|Company Type||Public Pink Sheets: LDBKY[ADR]; London: LAD|
|End of Fiscal Year||December|
|2005 Sales (millions)||$19,788.7|
|Sales Growth (1 Year)||(13.6%)|
|2005 Net Income (millions)||$569.5|
|Net Income Growth (1 Year)||13.4%|
|Employee Growth (1 Year)||(1.7%)|
Ladbrokes Poker Online Poker Room Review
As far as European online poker rooms go, Ladbrokes Poker is relatively small. The Ladbrokes Poker room does have some popularity within Europe especially within the UK, and receives a considerable amount of international exposure from the real life annual poker tournament the Ladbrokes Poker Million. The poker room is part of the well established British sports bookmaker, Ladbrokes, but because of its lack of high volume traffic the games offered give patrons few choices. For example, because of the popularity of no limit an pot limit in Europe, the limit poker tables are rarely used even during peak hours.
Ladbrokes regular poker tournaments are normally multi-table rebuy tournaments that range in buy-ins from a few dollars to the big $100 daily $30,000 guarantee. With only about 100-200 players per tournament, you do have a better chance to win but the prize pools are significantly less to other online poker rooms. Sit and go action at the lower buy-ins run regularly, but as the buy-ins get greater then $10 they occur infrequently. Only No limit Holdem and Limit Holdem tournaments are run, except in the sit and go area where you can find Pot Limit Omaha as well.
Generally speaking, for the most part the most popular action on the site occurs at the short handed no limit holdem cash game tables. The games offered by Ladbrokes Poker are Texas Hold'em, Omaha, Omaha hi-lo, 7-stud, and 5-stud.
On the bright side, the Microgaming designed software which is used throughout the Prima Poker network runs well and is user friendly. Furthermore, since Ladbrokes never allowed US players to play in its online poker room, the Safe Port Act passed by the United States Congress did not effect the traffic to the site.
Party Gaming Stock Analysis
Party Gaming is one of the most dominating online gaming giants within the very competitive online gambling industry. Party Gaming operates the second largest online poker company in the world, Party Poker, and has used its success there to launch other lucrative online gambling businesses like Party Casino, Party Bingo, PartyBets, Gamebookers, and Party Gammon. The online casino business allows players to wager on many different table games, and in conjunction with accepting bets for sports, Bingo, poker and backgammon, Party Gaming has diversified itself throughout the gaming market. To reach more customers, Party Gaming offers their services in 12 different languages.
Though Party Gaming lost a considerable amount of revenue when they closed their real money games to the US market, they wisely kept a presence in the US through their sister site PartyPoker.net that allows players to play for free.
The early years of PartyGaming were plagued by a few things. The previous company's name, iGlobalMedia, suffered from a poor reputation because they were caught using casino table game software that was not random. Furthermore, negative publicity from the media surrounded the company's co-founder Ruth Parasol because of her earlier involvement with adult businesses. The later very successful Party Poker Million cruise was also involved is some early controversy, as the first tournament in 2002 guaranteed a million dollar prize pool and with less then the number of players buy-ins needed to cover the guarantee, Party Poker lost several hundred thousand dollars. This loss was a blessing in disguise, as the positive publicity they received for making good on their promise gave them a lot of exposure.
Exposure to the Party Poker brand was increased dramatically during the first season of the World Poker Tour when the spokesman for Party Poker Mike Sexton hosted the shows. Party Poker was the only online poker room to advertise during the first few months of the highly rated first season, attracting thousands of new players to their site. Their market share skyrocketed and they became the world's largest poker room. Since then, they have fallen to second after being forced to pull out of the US market. When the UIGEA was passed in the US, the stock price fell by 60% within the first 24 hours. During the IPO of Party Gaming on the London Stock Exchange in the summer of 2005, market cap was just under 9 million dollars, and putting it amongst the 100 biggest companies on the London Stock Exchange. However, after leaving the US market, the market cap of Party Gaming fell to about 3 billion dollars. Profits fell from more then 1 million a day to less then half a million a day. On the bright side, Party Gaming headquarters are in the gambling friendly Gibraltar, where it is subject to a 1% gaming tax.
The future for Party Gaming is still very positive, as their name brand recognition is still strong and their diversified gaming income has helped them increase their revenue. Party Gaming is also uniquely positioned amongst other publicly traded online gaming sites to capitalize on reentering the US market when it is allowed to because of their ongoing presence allowing US players to play free at PartyPoker.net.
Party Gaming Company Information
Address: 711 Europort
Phone Number: +350-78700
Fax Number: +350-78790
|Company Type||Public (London: PRTY)|
|End of Fiscal Year||December|
|2006 Sales (millions)||$1,104.9|
|Sales Growth (1 Year)||13.0%|
|2006 Net Income (millions)||$128.4|
|Net Income Growth (1 Year)||(56.2%)|
|Employee Growth (1 Year)||(7.7%)|
Party Poker Room Review
was once the biggest and best online poker room in the world. They suffered a huge decrease in traffic after pulling out of the US market when the UIGEA was passed in 2006. They have since rebounded and continue to hold onto the number 2 spot in online poker traffic. Their multi-table tournaments and single table tournaments are some of the best you can find anywhere. Players continue to play here because Party Poker offers some of the best action games, special events, great bonus offers, bonus for referring new players, free roll tournaments, and a frequent player point program where you can exchange the points you earn for merchandise and entries into multiple-table tournaments. Party Poker hosts the annual Party Poker Million cruise and offers satellite tournaments so players can win their entry into this prestigious tournament. The host of the World Poker Tour Mike Sexton is the spokesman for Party Poker.
Party Poker Software is available for both PC, Macintosh, and Linux systems making it a leader in the industry to be able to offer online poker on all the widely used computer platforms. Party Poker's easy to use software and game speed also rank at the top of the online poker industry. Multi-tabling games is simple as the tables are all able to be sized to fit nicely on whatever monitor your using. Tournament's have a deal making function built in, and other tools like player notes, stats, and hand histories are all easily accessible to every player. Bad beat jackpot and high hand bonus tables are offered for players who want to play for these types of rewards. 60,000 to 70,000 tournament players are active during peak hours and cash games have about 10,000 players during peak hours making Party Poker one of the most played at online poker rooms in the world.
Party Poker is a piece of the larger Party Gaming empire which hosts other casino games like Party Casino's blackjack, roulette, and craps along with Party Backgammon, Party Bingo. Party Poker players can easily play the different games offered by Party Gaming. The poker room has Limit, Pot-Limit, and No-Limit offerings in most poker variations, including Texas Holdem, Omaha, Omaha hi/low, Seven Card Stud, and Stud hi/low. Multi-table tournaments, sit and gos, satellites and cash games occur 24 hours 7 days a week because of their large player base.
Sporting Bet Stock Analysis
Sporting Bet is home to the one of the first online poker room, Paradise Poker. However, Paradise Poker is not their only source of revenue, in fact the online poker room accounts for just a small percentage. The diversified Sporting Bet offers gamblers the "gaming supermarket" of choices on how to wager their money. These choices include sports betting, casino table games, and some skilled based games like poker. Sporting Bet was the first English company to offer tax free sports betting, now operates globally online to more then one million regular customers from 100 countries in about 25 different languages. to its nearly 1 million active customers in more than 100 countries and some 25 languages. After the UIGEA was passed in the US, Sporting Bet sold off most of its US gaming operations to Jazette Enterprises from Antigua, but still hold about 20% of their stock.
Sportingbet acquired Paradise Poker for $300 million in the fall of 2004, and immediately saw a huge spike in its stock value. Already trading on the London Stock Exchange's Alternative Investment Market for around 100 British Pence, a year and a half later it was at 400 British Pence and had a market cap over $3 billion. Profits rose from 14 million British Pounds to over 100 million British Pounds and the company expanded from a couple hundred people to over a thousand employees. However, the anti-gaming law passed in the US in October of 2006 crippled Sportingbet's stock price as it fell to about 35 British Pounds.
Sporting Bet Company Information
Address: 6th Fl., Transworld House, 82-100 City Rd.
EC1Y 2BJ, United Kingdom
Phone Number: +44-20-7251-7260
Fax Number: +44-20-7251-7270
|Company Type||Public (London AIM: SBT)|
|End of Fiscal Year||July|
|2006 Sales (millions)||$3,844.9|
|Sales Growth (1 Year)||43.3%|
|2006 Net Income (millions)||$129.9|
|Net Income Growth (1 Year)||85.2%|
|Employee Growth (1 Year)||29.1%|
Paradise Poker Online Poker Room Review
Though technically not the original online poker room, Paradise Poker was the first to offer stable software within a secure environment. As the pioneer for online poker in the middle of the 1990's, paradise went through a few phases. For a long time before Party Poker took over the title, Paradise was the largest online poker room in the world and at one point they had an 85% market share. Their dominance continued during the turn of the century, but with greater competition from Party Poker, Pokerstars, and others combined with players questioning the integrity of their games they lost considerable market share.
Since then, Paradise Poker has improved greatly while still keeping to their easy going style where you get to still play at a table set on the beach. One major improvement has been Paradise Poker moving into the Boss Media network which connected it to some other large online poker rooms. This move was intended to boost the size of their tournaments and increase the cash game action, both of which Paradise has seen considerable success. Furthermore, the Boss Media Network's software improvements have given Paradise the cutting edge look they lacked. These enhanced graphics make the playing experience more enjoyable and add increased functionality while also improving the game speed.
Though Paradise Poker is no longer one of the top poker rooms by size, any type of game you are interested in playing is always available. More improvements are needed however, as the game lobby is not nearly as player friendly as it should be. So finding a table takes some time getting used to, but once you have sat down you will see that the competition is much easier to play against. If you have any concerns or need help, the customer service is pretty good at answering emails.
888 Holdings Stock Analysis
The home to one of the fastest growing poker rooms, Pacific Poker, 888 also has the online casinos Casino-on-Net, 888.com and Betmate. Beginning in 1996, 888 Holdings went public on the London Stock Exchange in 2005 after having over 20 million customers and is a member of the FTSE 250. Much of the company is owned by the Shaked Shares Trust (25%) and the Ben-Yitzhak Family Shares Trust (17%). After the UIGEA was passed, 888 holdings and its Pacific Poker brand took a hit, but has since made considerable strides to increase its market share.
The market cap peaked at $1.4 billion but has fallen to around $500 million after the Safe Port Act was passed in October of 2006. Fortunately, the 888 Holdings' headquarters are wisely located in the gaming friendly Gibraltar, having to only pay a one percent gaming tax. The Casino-on-Net brand, which has had over 13 million blackjack, video poker, craps, slots, baccarat, keno, and roulette players since 1996, was originally the strongest online gaming brand in the world before the rise of internet poker giants like Paradise Poker, Party Poker, and Pokerstars.
With about 40% of income from 888 Holdings coming from poker, the company was set back from the Safe Port Act passing in 2006, however, because only about half of their player base were Americans their online poker operations continued and their market share is once again climbing because of their online advertisements, positive reviews from players, and cross marketing to their casino patrons.
The future for this firm is likely to be a positive one, mainly because their poker brand is gaining widespread positive reviews from players and its casino operations contributing to its diversified income source.
888 Holdings Company Information
Address: 601-701 Europort
Phone Number: +350-49800
Fax Number : +350-48280
|Company Type||Public (London: 888)|
|End of Fiscal Year||December|
|2005 Sales (millions)||$271.0|
|Sales Growth (1 Year)||52.3%|
|2005 Net Income (millions)||$48.0|
|Net Income Growth (1 Year)||17.1%|
Pacific Poker Room Review
Pacific Poker is home to a lot of gambling type players. This is because Pacific Poker is part of the 888 Holdings group that also controls the biggest online casino, Casino-on-Net, in the world. With poker games like Texas Hold'em, Omaha, Omaha Hi-Lo, Seven-Card Stud and Seven-Card Stud Hi-Lo, players have many options to choice from. Furthermore, certain games are offered as no limit, pot limit and fixed limit. Full table games, shorthanded, heads-up, satellites, sit and gos, and multi-table tournaments are available to players.
Pacific Poker has steadily been increasing their market share of online poker players because of its reputation of loose games and great promotions. These loose games are most notable in the No Limit Holdem and Pot Limit Omaha cash games. The traffic on the site has gained considerably because of widespread positive poker room reviews and Pacific Poker advertising campaign that announces money-added tournaments, satellites to live events and plenty of freeroll tournaments. Statistics for November 2007 show 1,800 ring game players and about 7,500 tournament players during peak hours.
Recent upgrades to the Pacific Poker software has given players a much improved graphical interface that includes avatars that look three Dimensional. Further improvements like a better layout and an easier to use search has given Pacific Poker positive reviews. Pacific Poker allows players to use keyboard shortcuts like pressing 'c' to call, 'r' to raise, and 'f' to fold which is unique within the online poker industry. Plus players can play multiple tables up to four at a time and have access to casino games like Bingo, blackjack, and slots. Similar to Full Tilt Poker's graphical hand history, Pacific Poker allows user to easily see previous hands. Pacific Poker is licensed by the Government of Gibraltar.
William Hill Stock Analysis
The William Hill Company finds itself as a leading gambling option for Europeans and especially the United Kingdom. Trailing behind only the gambling monster Ladbrokes in the highly lucrative United Kingdom market, William Hill operates over 2,200 betting shops located in the United Kingdom, Ireland and the Isle of Man.. These betting shops allow customers to wager on nearly every type of sporting contest such as golf, rugby, soccer, football, horse racing, cricket, American sports, elections, and much more. Over 200,000 active betting account regularly place wagers by telephone. One of their biggest revenue generators comes from their online gambling presence that includes a sportsbook, casino games, and the William Hill Poker Room.
The name William Hill has been since 1934 when it was founded and the William Hill brand is well known seeing that it is the second leading bookmaker in the UK. William Hill PLC is traded on the London Stock Exchange and belongs to the very exclusive FTSE 250 which makes it one of the 250 largest companies on the exchange. The company states that its online operations that started in 1998 are more profitable then its top competitor, Ladbrokes.
William Hill's earnings from online poker increased 44% in the first 6 months of 2006 compared to the first half of 2005. However, poker revenue accounts for only a small percentage of the company's profits. As the most popular member of the Cryptologic network, the William Hill Poker Room has built up its brand through quality software and name recognition. The William Hill poker room is a poker room skin for the Cryptologic network. The poker room no longer accepts United States players because of the Safe Port Act.
The profits for William Hill in 2005 were £111 million, a significant setback from the £148.3 they made in 2004. However, profits for the first half of 2006 rebounded and were up 30% over 2005. Compared to US betting companies who saw huge stock price drops after the UIGEA was passed, the William Hill stock was trading at its 2005 high of 650p during the fourth quarter of 2006. William Hill's earnings per share for 2005 were 28.5p. Fidelity and Barclays combined own over 25% of William Hill shares.
William Hill Company Information
Address: Greenside House, 50 Station Rd., Wood Green
N22 7TP, England
Phone Number: +44-20-8918-3600
Fax Number: +44-20-8918-3775
|Company Type||Public (London: WMH)|
|End of Fiscal Year||December|
|2005 Sales (millions)||$18,487.6|
|Sales Growth (1 Year)||15.8%|
|Employee Growth (1 Year)||17.4%|
William Hill Poker Room Review
As the most popular member of the CryptoLogic network, William Hill Poker is a major player in the online poker industry. Very popular within Europe, and England in particular, its tournaments and cash games get a huge boost from being part of the network which combines other major CrytoLogic poker rooms like Interpoker and Sun Poker. This network allows for players to easily play casino table games so there is a lot of overflow from the casino players into the poker room, making the games loose and soft. Talented players can easily make decent profit regularly because of the better action at William Hill then you might find at some other sites.
For the entire CryptoLogic network, including William Hill Poker, the period of tremendous growth from 2004-2005 was seriously setback after the ban on players from the United States. The entire network has since rebounded because it has added some new poker rooms and remains a major contender in the online poker market, consistently ranked in the top 10 largest online poker networks.
William Hill Poker continues to retain its players and attract new ones by offering money added tournaments and other special promotions to make it an attractive place to play. Furthermore, the software graphics enhance the playing experience and finding the right game to play has gotten a lot easier with the redesigned lobby layout.
All of the normal poker variations are offered at William Hill Poker including Texas Holdem, Omaha, Omaha Hi-Lo, Seven Card Stud and Seven Card Stud Hi-Lo. Fixed Limit, Pot Limit, and No Limit varieties of the games and the cash game tables give the player the option to play at full 9 handed tables, a short handed tables, or even heads up tables. William Hill's multi-table tournaments attract a good amount of players with up to 10,000 players during peak hours. Their cash games have nearly 2,000 players during the peak hours, which is around dinner time in Europe.
Bet and Win Stock Analysis
BetandWin.com also known as bWin acquired Ongame eSolutions the owners of PokerRoom.com at the beginning of 2006. Originally focused mainly on sports betting, in 2000 bWin went public on the Vienna Stock Exchange (Wiener Börse). Founded in 1999 by Simon Bold, the company has increased its annual earnings from 2 million British Pounds to nearly 200 million British Pounds. The player base before acquiring Casino Room and Poker Room from Swedish owned Ongame, was nearly 1 million players. After the acquisition, bWin has begun plans for launching an online race book for horse betting enthusiasts and has started aggressive marketing strategies that involve advertising at major international sporting events like tennis, golf, and soccer.
The acquisition of PokerRoom also opened the door for bWin to begin mobile gaming. The future potential for allowing players to place wagers from their mobile devices is the next gaming revolution. PokerRoom was the first online poker room to incorporate mobile devices, and through this acquisition allows bWin to add their sportsbook and casino games to the mobile market. With a lot of competition for American players, bWin intelligently focused much of their online gaming advertisements to attract players from Europe and Eastern Europe and getting them to become customers by offering over the software in 20 different languages including many of the Easter bloc like Polish and Czech. This European positioning benefited bWin when they lost almost 40% of their US market revenue following the Safe Port Act, which was a smaller percentage then many of their publicly traded online poker competitors.
Bet and Win/bWin Company Information
Address: Klarabergsviadukten 82
Phone Number: +46-856247000
|Company Type||Public (Vienna: SBT)|
Poker Room Review
is an exceptional online poker room. Many first time online poker players smartly begin playing at this site because of the great customer service and easy to use software that makes the learning process enjoyable. The games offered are all the basic poker variations of Texas Holdem, Omaha, and Stud. No Limit Texas Holdem, the most popular game in the world is available.
The software is very smooth and is offered in a Macintosh friendly no download or the normal download version that gives the player a few extra features. An extra feature like being able to take notes about other players right on the player for future reference is a valuable tool. One of the first online poker rooms, Poker Room has a unique state of the art graphics interface and a player friendly layout for the controls. Finding the right game is simple as the lobby is easily to sort to allow users to find exactly what they are looking for.
The Poker Room community is also a highlight of the site. Players can openly discuss anything in the lobby's chat room. Player traffic at Poker Room is very good, because players enjoy playing on this online poker room site keeping player loyalty high and the great domain name of Poker Room is one the easiest for new players to find. Unfortunately, they do not accept United States players so they miss out on the huge player traffic from the US.
Customer service is one of the priorities of Poker Room, so they offer email, live chat, and telephone ways for players to contact them.
World Poker Tour Enterprises Stock Analysis
The World Poker Tour believes that the popularity of televised poker will continue to grow. As the producers of the World Poker Tour TV series on the Travel Channel, WPT Enterprises has placed a lot of their eggs in that one basket. The show is based on 18 high stakes poker tournaments that are played in casinos worldwide, including Las Vegas, Monte Carlo, Aruba, and Paris. Anyone is eligible to play in the tournaments, as long as they pay the buy-in which can range from $5,000 to $25,000, with $10,000 being the norm. WPT Enterprises collects fees for filming the events from the host casino, but also has other income streams through their licensed WPT brand apparel and consumer products like chips and poker tables.
WPTE has a small WPT online poker room that does not accept US players. The WPT online poker room uses the award winning CryptoLogic software. Recently the poker room has been paired with a casino, from CrytoLogic's most popular games. Initially starting with 10 award winning games like the Marvel comics jackpot slots, Cubis and Bejeweled colorful slots, and the mega-progressive jackpot slot, Millionaire's Club, which has recently been hit for $4 million and $8 million.
Steven Lipscomb, President, Founder and CEO of WPTE stated "For WPT, it was important to offer a superior casino experience with integrity and innovation - and CryptoLogic was the natural fit...CryptoLogic's poker software has been extremely popular with our customers, and by adding some of the Internet's most popular casino games, the player's experience at WPT will be second to none."
WPTE has three divisions, the WPT Studios, the WPT Consumer Products, and the WPT Corporate Alliances. After going public in August 2004, WPT stock traded over $20 throughout 2005 during the peak of the poker craze. Unfortunately, the stock shares have fallen considerably to around $2 with little expectation that they will return to their previous highs. WPT is not a profitable company, they continue to operate without a profit year after year and the few stock analysts that watch it suggest this pattern will continue. The casino management company, Lakes Entertainment, controls over 60% of the available stock of WPTE. World Poker Tour's top competitor is the Harrah's owned World Series of Poker. The WSOP brand is stronger and more recognizable, and most poker players would rather have a bracelet from the WSOP then a WPT title. Furthermore, the WSOP has the backing of a major casino chain in Harrah's while the WPT has to work out partnerships with casinos to host their tournaments. Though poker makes for great television because of the use of hole card cameras and interesting personalities, the WSOP receives much more exposure on the cable sports giant ESPN then the WPT gets on the Travel Channel.
World Poker Tour Company Information
Address: 5700 Wilshire Blvd., Ste. 350
Los Angeles, CA 90036
Phone Number: 323-330-9900
Fax Number: 323-330-9902
|Company Type||Public (NASDAQ (GM): WPTE|
|End of Fiscal Year||December|
|2006 Sales (millions)||$29.3|
|Sales Growth (1 Year)||62.0%|
|2006 Net Income (millions)||$7.8|
|Employee Growth (1 Year)||45.6%|
CryptoLogic Stock Analysis
CryptoLogic engages in the development and supply of online gaming solution, in other words they are responsible for creating gaming software for some of the biggest online casino companies in the world. As the leading supplier of the software and systems used by many of the giants of the online gaming world, CryptoLogic has a strong hold on its market and a great reputation. The gaming software CryptoLogic produces includes over 200 casino games, table games, slots, and online poker. Furthermore, CryptoLogic develops secure payment software which allows funds to transfer safely between the online gamblers and the online gaming sites. CryptoLogic gaming software is licensed through one of its subsidiaries, WagerLogic, to such companies like Ladbrokes for use in their William Hill online Poker Room. WagerLogic online gaming operations include the following Casinos in their network:
|CryptoLogic Casino Name|
|William Hill Casino|
|The Sands of the Caribbean|
|The Ritz Club London Casino|
|1 On1 Casino|
|3 Diamonds Casino|
|UK Betting Casino|
|Total Bet Casino|
InterCasino is CryptoLogic's own online poker room, which was forced to leave the US market after the UIGEA was passed in 2006.
Recently, CryptoLogic has added one of the top poker brands, the World Poker Tour Enterprises to its collection of companies that license its software. The WPT had been using the CryptoLogic poker software for some time, and WPT has recently added CryptoLogic's top casino games as well including mega-jackpot slots. The view by A.J. Slivinski, Managing Director of WagerLogic, was that "By providing a 'mini-casino' of our top-performing games, we're helping customers build player loyalty - and profitability. The combination of top quality games from CryptoLogic -- and rapid deployment by WagerLogic -- is yet another competitive advantage for our customers, and our business."
Essentially, the high tech quality software and speed with which it can implement the software makes CryptoLogic a dominant leader of electronic gaming. CryptoLogic has a solid business plan that will certainly help it to continue to succeed in delivering the high demand innovative gaming products to the ever-expanding gaming industry. CryptoLogic won the Top Casino Software award from Online Gambling Magazine the past two years. In the gaming software industry, the award is the biggest honor a company can receive. Furthermore, the voters for the Top Casino Software award are from the most important people, the magazine readers, players and website visitors.
CryptoLogic Company Information
Address: Alexandra House, The Sweepstakes
Dublin, 4, Ireland
Phone Number: +353-16-31-9000
Listing date June 11, 2007
|Company Type||Public (NASDAQ (GS): CRYP; Toronto: CRY)|
|End of Fiscal Year||December|
|2006 Sales (millions)||$104.0|
|Sales Growth (1 Year)||20.5%|
|2006 Net Income (millions)||$25.6|
|Net Income Growth (1 Year)||24.9%|
Boss Media Stock Analysis
The big competitor to Cryptologic's software, Boss Media is a major supplier of internet gaming software systems to online gaming industry. Boss Media's software comes customized and branded for its online casino operator clients, and allows these clients to offer online gaming for their customers over the internet or by cell phone. The excellent software includes a variety of gaming options including blackjack, roulette, craps, video poker, poker, Bingo, and lottery tickets. Boss Media licenses its Interactive Video Terminal (IVT) system that allows online casino operators to set up operations anywhere their is an Internet or local/wide area network.
Boss Media Company Information
Address: Honnörsgatan 2
Phone Number: +46-470-70-30-00
Fax Number : +46-470-70-30-50
|Company Type||Public (Stockholm: BOSS)|
|End of Fiscal Year||December|
|2006 Sales (millions)||$46.7|
|Sales Growth (1 Year)||51.1%|
|2006 Net Income (millions)||$9.4|
|Net Income Growth (1 Year)||824.1%|
|Employee Growth (1 Year)||1.9%|
Privately Owned Online Poker Companies
The big difference between privately held online poker rooms and their publicly owned counterparts is that private companies do not have to follow the laws of the United States. What this means to the privately held companies is that they did not have to leave the US market when the UIGEA was passed in 2006, and therefore benefited from an increase in player traffic as Americans transferred to their poker sites. With this movement of players to just a few sites their cash games and tournament prize pools exploded attracting players from outside the US to these rooms.
The major privately held online poker rooms are:
Probably benefited the most from the transfer of traffic after the US offshore gaming regulations were changed. Full Tilt Poker tag line is that they are The Home of the Pros, where you can learn, chat, and play with the pros. Full Tilt Poker hosts the annual FTOPS, one of the largest online poker series. They offer a very generous sign up bonus for new players
The current #1 of online poker rooms. Nobody is bigger and nobody offers better customer service. In fact, Pokerstars is one of the few companies who regularly read poker forums like 2+2 and listening to players in an effort to improve the playing experience for their customers. The site's popularity exploded after having back to back World Series of Poker main event champions Chris Moneymaker and Greg Raymer originate from playing inexpensive satellites on their site offers new players
The home to the legendary Doyle Brunson, winner of 10 World Series of Poker titles including back to back main event wins in the 1970's. The site prides itself on player security punctuated by Doyle guaranteeing himself player's money on the site. What the software lacks in graphics, it more then makes up for in speed. The pioneer of online poker bounty tournaments, in which you get a bonus for knocking out certain players, is a great place for beginners and intermediate low limit players to play. First time players receive a on their first deposit,
UltimateBet: After merging with Absolute Poker, UltimateBet is now facing a considerable backlash from the huge Absolute Poker cheating scandal that took place from August-November of 2007. With WSOP legend Phil Hellmuth as the face of the company the site was making considerable traffic gains until recent allegations of Poker Software Bots being used by players and the ease to which players can multi-account at the same table.
Absolute Poker: This site is under investigation after management was caught cheating their own players by using a super-account which allowed the management AJ Green and Scott Tom to see their opponents hole cards. After initially denying reports, poker forums lit up with hand history evidence that made left little doubt that the cheaters could see their opponents hole cards.
Regulating Publicly Traded Online Poker Companies
Internet poker regulation is conducted through different commissions and a few governments of countries where the headquarters are located. The three big commissions are the Kahnawake Gambling Commission, the Gambling Commission of Great Britain, and the Isle of Man Gambling Control Commission. A few governments play a role in regulating online poker as well, including Gibraltar where many of the online poker operators make their headquarters mainly because of the generous tax laws on gambling. In fact, Gibraltar only charges a 1% tax on gaming operations with a minimum of $150,000 and a maximum of $750,000 total tax paid. Another location for online poker rooms is the very relaxed Costa Rica, which does virtually no regulation at all once you have obtained an easy to obtain business license. Often times the small Caribbean country of Antigua is mentioned with regards to internet poker regulations because it won a landmark World Trade Organization (WTO) decision against the United States. That 2005 ruling the US law which made online betting illegal violated international law and therefore was not enforceable. However, the US continues to pick and choose which WTO rulings it will follow and this one they have ignored.
The Kahnawake Gambling Commission is probably the best known of the gaming commissions, mostly because of the recent publicity that the Absolute Poker cheating scandal brought to it. In the summer of 1996, the Kahnawake Mohawk Territory near Montreal, Canada established the Kahnawake Gaming Commission to license and regulate gambling activities including the poker and casino companies who were using the Kahnawake Indian Tribe's computer servers.
Kahnawake Gaming Commission regulates gaming activities based on three ideas. The first is "That only suitable persons and entities are permitted to operate" meaning that the gaming companies must be legitimate and approved by the Commission. The second is "That the games offered are fair to the player" meaning players shall not be cheated in anyway including that there should be no corruption within the management or unfair games. The final principle is "That winners are paid" meaning that an operator must always have the funds available to pay out to the winning players. The Commission does background checks on all applicants, conducts audits regularly of those operating, and offers other support to the online businesses it regulates. Most of the powerhouse online poker rooms have been granted licenses such as Pokarstars, Paradise Poker, PokerRoom, and UltimateBet. The Commission also conducted the investigation into the Absolute Poker cheating scandal in which two top level management Scott Tom and were using a super user account that could see all opponents cards to cheat players out of nearly $1 million dollars.
The Gambling Commission of Great Britain was formed after British Parliament passed the Gaming Control Act of 2005. This Act is the first step for the UK to regulate online gambling, covering everything except the National Lottery and spread betting. The objectives of the Commission are to prevent gambling from being a source of crime or disorder, ensuring that gambling is conducted in a fair and open way, and to protect children and other vulnerable persons from being harmed. The Commission has just begun regulating with its duties being increased over time, and most of the online poker rooms which it will govern are in the application process.
The Isle of Man Gambling Control Commission, based in a small island territory off the coast of the United Kingdom, has become a small player in the internet gambling regulating business including being responsible for the largest online poker room, Pokerstars. The nation has actively pursued companies to locate there with very lenient tax laws and incentives, especially for high tech companies. Under the 2001 Online Gambling Regulation Act the Isle of Man has aimed its focus at regulating the online gambling market to make it free of crime, protect those that need protecting, fair gaming practices, and that winnings should always be paid out. In general they say that "A well regulated gaming industry serves the best interests of all involved" meaning the player, the operator, and the Gaming Control Commission. The Commission has measures in place that protect the players, such as the mandatory independent testing of gaming software. Pokerstars is their best known client.
The United States does not regulate internet poker at the current time. The near future will probably change that. Many of the large brick and mortar casinos like Harrah's and MGM felt threatened by the online poker industry that they were not a part of and lobbied hard to have it taken away. They nearly got what they wished for with the UIGEA, but because the private poker rooms did not follow the Act online poker survived. Ideally, these casino giants will also become part of the internet poker industry adding their brand strength to their respective sites while being regulated by the United States.
UNLAWFUL INTERNET GAMBLING ENFORCEMENT ACT
The UIGEA which was added to the end of the Port Act at midnight before the US Congress went on break for the 2006 elections. Below is the UIGEA part of the Port Act. The Act did not make online gambling illegal to US citizens, instead it aimed to make it more difficult for US citizens to gamble online. The Act pushed by Kentucky Republican, Bill Frist, made it illegal for financial institutions like banks and e-wallets to make funds transfers to any online gambling site. What resulted was the closing of doors for US customers from any publicly traded company while private companies with operations outside the US jurisdictions figured the law does not apply to them and have continued operations with the added benefit of new patrons who transferred from those rooms that left the US market.
The future of online poker is very bright, and these companies who have positioned themselves well and have gained good reputations will benefit for a long time. Those Online Poker Rooms that have poor reputations because of security issues will never fully recover. Eventually, the US market will reopen to publicly held companies either via the UIGEA getting totally reversed or changes made to force all online casinos to become regulated and taxed.