Useless predictions

[StellarWind]

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Paradise Poker will differentiate based on the state of residence of the US player.

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No way IMO. Paradise is all-in and will stay until the bitter end.

They are very dependent on American business and cannot afford to give up this market. As for a state-by-state approach, that doesn't do anything when your major line of business is a sportsbook that violates the Wire Act. Legally they are beyond redemption at the Federal level anyway so why care about state law?

[Poker_Hoar]

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Nate, do you think the fact that Party Gaming is publicly traded in London will have any effect on their decisions. I guess my question is would the British authorities make them stop taking US customers.

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PartyPoker is the Walmart of the poker industry: they're all about volume, volume, volume. And an unusually high percentage of that volume is concentrated in the United States; if they cut out the United States, they're no longer the market leader. Thus, I think they'll figure "we're the captain of this ship and we're going down with it".

I do think publicly traded status is something that might encourage companies to be more careful, all else being equal, which is why I listed 888.com as the most likely to prohibit US players. They're publicly traded, BUT their player base is more heavily European, and there may be some "first-mover" advantage to the company that first abandons the US. But PartyPoker has too much to lose to do that IMO. Just my gut-feel.

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The analogy between Wal Mart and PartyPoker is true for size business compared to the rest. But the analogy ends there.

Wal Mart's philosophy is completely 'Every Day Low Prices.' Wal Mart looks at consumer promotions as 'gimmicks.' Party Poker is very focused on spending money behind promotions and advertising.

It is unlikely that Party will change it's strategy. Instead it will shift spending from the USA to other markets. Unless the liquidity generated by spending in these 'new' markets is equal to the USA the overall impact will be a contraction of the business.

[advilandy]

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Legally they are beyond redemption at the Federal level anyway so why care about state law?

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The bill states that it doesn't supercede state law that explicity states otherwise.

[AndyH69]

Paradise has a lot of European players too.

Looking at the parent company's (i.e. Sportingbet) Q3 figures, revenue across the whole business (including sports betting) is split as follows (all in £):
US - 276.1m
Europe - 149.7m
Australia - 81.5m

Figure are taken from this page: http://www.sportingbetplc.com/pages/101/Results.stm

So, Sportingbet stands to lose around half of its business, assuming the 54% split in the above Q3 figures is representative of the year's revenue.

When considered alongside PartyGaming, I would imagine that Sportingbet's loss won't look bad at all... Certainly, the business will survive, whereas PartyGaming perhaps will not.

[Canard]

Mason Malmuth's lawyer to release a two line statement on Monday confirming that he doesn't believe any legislation will be passed before the elections.

[CountingMyOuts]

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Paradise has a lot of European players too.

Looking at the parent company's (i.e. Sportingbet) Q3 figures, revenue across the whole business (including sports betting) is split as follows (all in £):
US - 276.1m
Europe - 149.7m
Australia - 81.5m

Figure are taken from this page: http://www.sportingbetplc.com/pages/101/Results.stm

So, Sportingbet stands to lose around half of its business, assuming the 54% split in the above Q3 figures is representative of the year's revenue.

When considered alongside PartyGaming, I would imagine that Sportingbet's loss won't look bad at all... Certainly, the business will survive, whereas PartyGaming perhaps will not.

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Yeah, my shareholders would be content and happy to see 54% of revenue disappear. [img]/images/graemlins/confused.gif[/img]

[AndyH69]

True [img]/images/graemlins/smirk.gif[/img]

But my point is that Party's business is more skewed towards the US.

Here are PartyGaming's revenue figures for the six months to 30 June 06 (all in $)
US - 512.1
Europe - 90.6
Canada - 43.5
Rest of the world - 15.7

You can see that the US business accounts for 77% [img]/images/graemlins/shocked.gif[/img]

(By the way, note that PartyGaming's figures are for 6 months, whereas Sportingbet's in the previous post are for 3 months.)

[Soulman]

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Mason Malmuth's lawyer to release a two line statement on Monday confirming that he doesn't believe any legislation will be passed before the elections.

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Nice.

[CountingMyOuts]

Sure, I know what you saying. [img]/images/graemlins/smile.gif[/img]

54% of revenues from US players is more than enough to compel Paradise to stay in until the bitter end, though, IMO.

[Richas]

Party to announce shift in tax and regulation to UK to demonstrate there still is a legal business to be had, to do a press conference contrasting UK attitude and Tax revenues to US no tax revenues, deliberate breach of WTO regulations and infringement of individual freedoms.

They have to bat now (and show the shareholders they have left that there is a plan to get back into the US).