There is no online gambling market more volatile, perhaps in the history of online poker, than the one that currently exists in the United States. The market has changed drastically in the last year and with regulated poker expected to come to Nevada and possibly other states by the end of the year, 2012 is likely to be another eventful year for U.S. players. In this edition of our Handicapping Series, which follows our previous discussion on Full Tilt Poker, Pokeraddict and I go over various scenarios revolving around the "Status Quo" U.S. market. Next edition will focus on how we see the U.S. "Regulated" market. Again, as is the case with our previous posts, please don't take any of these topics too seriously (or bet on the lines!). Hopefully, our discussion can result in some good food for thought for anybody reading. Odds of Merge being overtaken as top U.S. room in 2012 (with a full status quo market)? Pokeraddict's line: +800 Gonzo: +1000 Pokeraddict: I do not think there is any room in a position to overtake Merge Gaming. With more than double the traffic of their closest U.S. friendly competitor, no site can keep up. As long as Merge Gaming does not leave the U.S. market, and can offer cashouts within 2 months, I feel they are the clear winner. Gonzo: Agree 100%. Even with some of the negatives at Merge right now (lackadaisical action on certain issues, slow payment processing) Merge Gaming is doing a fair amount of things right. The next two biggest sites, Bovada and Cake, have negatives that some players find as deal breakers (Cake Poker with even slower cashout times and Bovada with their anti-reg philosophy) that are enough of an issue that I don't see them making a strong run. The one exception I see is Winning Poker because they seem to really *want* to be #1, but at 15% of Merge's size, they have a long road to the top. By the way, this question assumes that Merge Gaming is not forced out of the U.S. Odds of Bovada dumping Anoymous tables? Gonzo: +600 Pokeraddict: +800 Gonzo: The recreational player model seems to be an obsession for poker rooms that have it implemented. The rooms that have these systems feel it is the only way to the long term health of a poker room. Call it dedication or stubbornness, this mindset will not be changing any time soon. Pokeraddict: Bodog seems stuck in their ways, regardless of how they affect players or their traffic. They firmly believe that anonymous tables are the way to go to protect their sports and casino whales. While I disagree and see several issues with that, I respect their right to run their business as they see fit. I think it will take a major security scandal to break the anonymous tables. Odds of Bovada.lv Leaving the U.S. market? Pokeraddict: +350 Gonzo: +300 Pokeraddict: I feel that Bovada is here for the long haul. As we learned today, they are being cautious by leaving high risk states. As long as their processing is not completely strangled, I feel they are in the U.S. to stay. I also feel that if they should leave the market, players funds would be at little risk. Gonzo: I also think the state-by-state approach is an indication they don't plan on leaving any time soon. The Winning Poker Network illustrated that a poker room can operate after a domain name seizure so I don't see how Bovada will be any different, especially given that they have operated a sportsbook when the legality was under little question. Odds of network/room leaving the U.S. without government action during 2012 (Merge, Cake are the only ones not to have had a major incident. Winning Poker and Bodog (Bovada) have but have continued to operate after seizures): Gonzo: +200 Pokeraddict: EV Gonzo: This question is basically "will Cake or Merge Gaming leave without obvious government action." I think Merge Gaming is more likely due to their LGA license and being relatively proactive in the past (bans in 6 or 7 states where legality is more in question, temporary suspension of all new sign-ups). Pokeraddict: I think it is a coin toss. Processing is going to get harder and harder. Some rooms appear to be stressed harder than others. Any more processor failures or busts could be catastrophic to some of these rooms. Odds of there being any new major new U.S. rooms pop up (non regulated)? Pokeraddict: +5000 Gonzo: +1000 Pokeraddict: No poker room that goes to the trouble of creating a software is going to take a chance in this market. Some feel that the U.S. is on the edge of regulation. Entering the U.S. market now would be suicide for any company looking to be in the U.S. long term. I doubt players would trust any new site enough to make it a major room. Gonzo: Well said. Any NEW U.S. room NOT popping up on a major network needs to be met with extreme skepticism. Odds of payment processing improving during the year? Gonzo: +500 Pokeraddict: +200 Gonzo: I think it's very likely that payment processing for U.S. rooms will continue to be under extreme pressure, however, I don't think it's a foregone conclusion that things will get much worse from where things are now. I don't see how it can get much better, however. Pokeraddict: There are a few rooms that are having few problems with cashouts. Considering bank wires appear to be near impossible, I think that could improve in the future. I feel they can only get better for a few rooms which is why I do not see it as being as big of an underdog as Gonzo does. Odds of Everleaf Gaming paying players by the start of the World Series of Poker? Pokeraddict: +700 Gonzo: +500 Pokeraddict: I have a bad feeling about whether Everleaf Gaming will ever pay U.S. players. At the very least, 2.5 months from now is very short term. Gonzo: I share your pessimism, unfortunately, and don't see myself getting my $200 any time soon. With that said, I don't think their situation fits into any specific previous scenario. They haven't lost a huge % of their traffic like Absolute Poker/UB (only 25% or so) and can't be fairly compared to PokerStars, which clearly had a ton of cash to pay out players very quickly. Hopefully, there is a light at the end of the tunnel before the World Series. Otherwise this is going to start to feel a lot like Full Tilt. Odds of the following rooms leaving the U.S. market in the hypothetical scenario of their domains's being seized: Gonzo: Merge Gaming +100, Bodog (already happened), Cake Poker +200, Winning Poker (already happened) Pokeraddict: Merge Gaming +100, Bodog (already happened), Cake Poker +300, Winning Poker (already happened) Gonzo: Bodog and Winning Poker have been two victims of domain seizures and have continued to provide online poker to players, while Everleaf Gaming left after a payment processing seizure and a cease and desist. Merge Gaming is the more likely of the two to leave after this hypothetical scenario given their Malta license (which apparently played a role in Everleaf leaving). I could see Merge going back to Kahnawake if they wanted to stay and then just leave the states where there are laws against online poker or states that are regulated. Cake would be more likely to stay because A) they don't have a Malta license and B) they would presumably get hit much harder than Merge Gaming or Everleaf if the U.S. market were to be cut off. Pokeraddict: I see things exactly as Gonzo does. We are in a situation where I think Merge could feel some heat in the near future. They are processing many more times the payouts than Cake Poker in the U.S. so I feel they are more likely to be the target. Merge Gaming processes most of the payouts on their network while Cake Poker has many skins that process their own payments. In addition to this, Merge Gaming is triple the size. As for the rooms that have already run into trouble in the US, I feel that they are here to stay. If getting indicted and losing their domains did not affect them, nothing will. Odds the top U.S. rooms (Merge, Cake and Bovada) stop accepting U.S. players from states where there is regulation? Pokeraddict: Merge -500 Cake -200 Bovada -200 Gonzo: Merge Gaming -300, Cake Poker -200, Bodog +200, True Poker +100 Pokeraddict: I seriously doubt all of the U.S. friendly rooms will attempt to compete in Nevada or any other state where online poker becomes regulated. Few players will want to play there due to the ease of playing on regulated sites, and the penalties would be harsh for the rooms. There is little reward based on the risk. I believe there is little chance Merge gaming stays. Cake Poker and Bovada would be more likely to hang out in the markets in my opinion. Gonzo: Unless regulation is incredibly restrictive or unattractive (ridiculously high rake, few games in the case of intrastate poker in low populated states) playing on non-regulated sites in regulated states is likely to be unappealing. I think a couple poker rooms may make statements by leaving the regulated states while a couple others may continue to offer their games to players that prefer them for one reason or another. In general, regulation itself will effectively do most of the work with more attractive sites to play. Thanks for reading this edition of our Handicapping Series. Stay tuned for the next edition when we will be discussing and handicapping the regulated U.S. market.
Make no mistake about it: 2012 is looking to be a big year. Between regulatory changes -- most notably in part of Europe and the United States -- and a hopeful resolution in Full Tilt saga this year there will be plenty of new stories to follow. The drama of 2011 and Black Friday is still relatively fresh in our minds, but it's now clear that real change is on the horizon, possibly making 2012 the year when online poker officially moves into a new age (which we think will be an overall positive given the major difficulties of 2011). As a result of these truly interesting and exciting times, over the next few weeks Pokeraddict and I will be expanding our Full Tilt prop bet scenarios idea from last year to cover a variety of topics of interest to players, affiliates and industry observers. We really enjoyed putting our last post together and based on your feedback, many of you enjoyed reading it. In this edition of our Handicapping Series, we'd like to revisit our original Full Tilt Poker scenarios post with discussion of some of same questions with a couple fresh topics. As we mentioned in our previous post, we don't claim to be dug into the trenches on most of these issues, but we have spent a lot of time reading and thinking about the situation (Pokeraddict might be the only one on the planet that read the entire DOJ indictments and Nevada online regulations). We are not taking ourselves too seriously here but we hope that some of the topics and questions brought up will provoke thought that may even be helpful in your affiliate business or poker playing future. So let's get on with it... What are the odds that the GBT/Full Tilt deal will eventually come to a positive resolution (all players paid, games running again)? Pokeraddict's line: +375 (3.75:1 against or 21% chance) Gonzo: +200 Pokeraddict: There are too many variables that make me feel like there is only a small chance that FTP comes back this year, if they ever return. The latest issues with Chris Ferguson and the money that allegedly belonged to him that kept the company floating is just another problem plaguing the reorganization. Ferguson's attorney denies this news, but I feel there must at least be some truth to it. With as much money as GBT is willing to throw at this, I just cannot figure out why they do not just open their own poker room from scratch with the same marketing concept. Gonzo: You're optimism sure hasn't been lost since the last time (sarcasm). I certainly think there is reason to doubt a deal coming to fruition. But remember that all parties are much better off if a deal gets done. Ferguson and Lederer will really be able to walk into a poker room again if a deal doesn't happen, Tapie will be a hero, players will get their money and DOJ could ease some bad blood (although most of that bad blood has turned to Full Tilt ownership over recent months). Assuming it is still in line to happen, what is your projection on the o/u on when the games will be live? July 2012 Pokeraddict's line: December 31, 2012 Gonzo: August 2012 Gonzo: Last October I said that June 2012 would be the over/under. With the deal behind schedule at this point for that scenario to come to fruition, I'm moving things back to August. How ready is GBT to launch if major progress was made? Between the DOJ, the recent Chris Ferguson news and other hold-ups, it feels like a lot of red tape still needs to be cleared. Pokeraddict: The reason I answer this is because I just do not nee anything happening. If something does happen, it will take most of this year to get things organized and reopened. What is your projection on the number of real money players during peak times on the new Full Tilt one month after launching (o/u)? Pokeraddict 1,200 Gonzo: 2,500 Pokeraddict: With no US players, and the lack of players that will be willing to deposit at first, I see Full Tilt being on the lower end of most player projections. What may help the situation is a strong prop program and the help of fresh online poker pros. There is the issue of previous Full Tilt pros not being involved that may hurt the marketability of the new brand. I know I predicted three times this number before, but it seems we are still too far from an actual reopening. The brand dies slowly with each passing day. Gonzo: I agree and that is why my number has moved down by about half since last October. Still, they have a huge brand recognition and I'm sure many will forgive Full Tilt when they realize its not under old ownership. That combined with their highly acclaimed software makes me think its reasonable they will be the size of Merge one month after launching based on a September 2012 launch. As you said, things deteroriate with every passing day. What are the odds Phil Ivey takes part in the 2012 WSOP Main Event? Pokeraddict +100 Gonzo: +200 Gonzo: Phil Ivey is playing more live tournaments these days, including the Aussie Millions which he won last week. Ivey playing these events actually contributes to my relative optimism of a positive Full Tilt resolution. In regards to this question, I think these recent tournament appearances are enough to bring my line down from +350 last October to +200 now. However, I think it's one thing to play the Aussie Millions and another to play the most prestigious event in the world, where there will be a huge spotlight on him. I'm not sure the positives would outweigh the negatives for Mr. Ivey. If a Full Tilt resolution is well underway by the summer, the odds drastically improve. Pokeraddict: Considering Ivey played the Aussie Millions, I feel he will play the 2012 WSOP this year after sitting out the series in 2011. The chances increase if Full Tilt actually looks like it is going to reopen. What is a the o/u on when U.S. players will receive their money? Pokeraddict: Never +200 Gonzo: April 2013 Pokeraddict: It is hard to book a "never" bet, but I see little hope here. The goal to reopen Full Tilt was the first quarter of 2012. Full Tilt is nowhere near being able to reopen. The DOJ is nowhere near setting up a refund process, and I am not convinced that it will ever happen. If there is a refund process, it will be long and tedious. If there is a refund, players may only get a fraction of their money. Gonzo: First of all, my line assumes the August 2012 time frame for games going live. This time frame could be optimistic even with timeframe, because I don't really have a good read on how long the DOJ would take on their end to get players paid. You can be sure there would be intense pressure from players and player interests. What are the odds of affiliates being paid during 2012? Pokeraddict: +900 Gonzo: +800 Gonzo: I still think the odds of this happening are bleak, even worse than I projected last year. My guess is the extra cost of working with affiliates will be seen as too much of liability for GBT although the x factor is still that a new Full Tilt could need affiliates more than ever (which many of us think they would -- see below). Perhaps the motivation to get off to a good start with affiliates would be enough. I wouldn't bet on it, though. Pokeraddict: The only way I see affiliates getting paid in full from the old Full Tilt Poker owners is if GBT is in dire need of affiliates. Otherwise, affiliates are at the bottom of the list of people waiting to get paid. Affiliates will never see a dime unless GBT gets so desperate for affiliates that they are willing to dig deep. Affiliates may see a percentage of what they are owed, but a full payment is doubtful. Affiliates have shown too often that they are willing to put up with too much from operators. Even if affiliates do not get paid, some of them will still promote the new Full Tilt Poker. This leaves little motivation for the new Full Tilt to pay up for the old Full Tilt. What is the likelihood of the new Full Tilt working with affiliates after launch? Pokeraddict: -300 Gonzo: +100 Pokeraddict: If Full Tilt Poker reopens, they will need affiliates more than ever. I project that Full Tilt Poker would drop some of the silly deductions and try to do anything that might help bring back affiliates. The problem will be that some affiliates will expect full reimbursement of commission owed from the previous Full Tilt Poker. I do not see that happening. Affiliates have been known to forgive though and I expect to see Full Tilt on many affiliate sites should they reopen. Gonzo: Agreed. The number one "rally the troops" move would be to honor the commissions before they closed last summer. A more likely scenario would be for GBT to not honor those commissions (not sure you could blame them too much) but still work with affiliates in some capacity for the reasons mentioned. I think if this happened, for the most part affiliates would welcome Full Tilt with open arms. So that is how Pokeraddict and I see the Full Tilt Poker situation with current public information. Because of developments late last year, I look at the situation somewhat more favorably while Pokeraddict essentially feels like a deal would have been done already if it was going to happen. We hope you enjoyed reading and please share any comments you have. Stayed tuned for the next edition of our Handicapping Series where we will discuss the current U.S. market. Disclaimer: Please note the opinions expressed in this blog post do not necessary reflect ...
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