iGaming
The first reports of the recently merged
Bwin.party may have uncovered further
synergies, but the company recognises there’s still a lot of work to do.
Bwin.party prepared for regulatory landscape
JIM RYAN: ‘WE’RE ACTIVELY WORKING ON INTEGRATING OUR TWO PAYMENTS PLATFORMS’
iGAMINGBRIEFS
PROFITABLE YEAR FOR NETPLAY
MERGER B
win.party is pre- pared for the changing regula- tory nature in Europe as the
continent’s various coun- tries all gear up to tackle the online gambling industry in a myriad different ways. Speaking as part of his
firm’s interim financial results, co-CEO Norbert Teufelgberger said that it has been preparing for the devel- opments for ‘many, many years’ and said that the newly merged firm had changed its operating philosophy. He added: “We are also adapting our technology platforms continuously and we have a clear goal here; to demand a market share of at least 15 per cent off each of our product verticals in every regulated market. We are also encouraged by the fact that governments across Europe especially look more and more for a commercially viable struc-
ture by allowing more and more products and by being more reasonable in terms of the tax rates applied. “We are taking a long- term view here. It may well be that in certain countries, certain products may not be allowed right away. It may also be that the tax initially is too high. But again, fol- lowing the example of Italy which over the years have adjusted their product range and also brought the taxes down, we would expect it to happen in all other countries as well.” The firm is also going to take a local approach to branding, although it plans to make the most of its two biggest names post-merger, according to Teufelberger. “We clearly repositioned bwin as a sports and Party- Poker as a poker brand with very distinct and clear mes- saging. Furthermore, what is very important to under- stand is that both brands will
still carry all of the products on their sites. For casino and bingo we are going for a dif- ferent strategy, namely by choosing a regionally diverse and more adjusted approach and it will differ from market to market.”
Bwin.party is also antici- pating a ‘significant oppor- tunity with mobile’ according to co-CEO Jim Ryan. Citing a Gartner report forecasting mobile gaming will be worth $11.4bn (£7.0bn) by 2014, Ryan said that the firm had been making ‘significant investments in this particu- lar area’.
“So what do we have today that we can boast of?” he asked. “I think unlike any other competitor in the mar- ketplace we have our own mobile platform. So we build our own products, it’s integrated into our back office, single wallet, single sign on, all of those wonder- ful things that we’ve been
preaching for many years. What’s also unique is we have a dedicated mobile team which is currently over 30 people and growing.” Ryan also revealed that the finishing touches to the first stage of the merger are being made: “Near-term projects that we’re execut- ing on right now, we’ve com- pleted the integration of live video streaming from the Bwin platform onto Party Bets and to Gamebookers. Our completion of organi- sational blueprints is just about done. We’re actively working on integrating our two payments platforms at this point in time - that’s looking like a Q3 conclu- sion. And by the end of the year, we’ll be using what is the PartyCasino platform in the Bwin environment. Quickly in 2012 you’ll see us integrate the poker plat- forms and ultimately, we’ll have one complete platform across all verticals.”
Full Tilt still looking for a buyer T
POKER
roubled poker operator Full Tilt Poker has issued a decidedly strange statement in which it claims that the US government and a rogue payment processor have taken a combined US$157m (£96.8m) from the company - pre- venting it from paying back its cus- tomers.
The statement claimed that the company ‘was not prepared for the far-reaching, US government enforcement effort of Black Friday’. It said: “The events of Black Friday came on the heels of prior govern- ment enforcement activities and significant theft. Over the two years preceding Black Friday, the US gov- ernment seized approximately $115m (£70.9m) of player funds located in US banks.
“While we believed that offering
peer-to-peer online poker did not violate any federal laws - a belief
and charged with money launder- ing, bank fraud, wire fraud through his Intabill business in April 2010. However, Tzvetkoff, facing a 75-year jail term, turned government informer, giving the FBI the informa- tion it needed to back up its Black Friday actions, and is now sus- pected to be in a federal witness protection programme.
supported by many solid and well- reasoned legal opinions - the DOJ took a different view. In addition, as was widely reported, a key payment processor stole approxi- mately $42m (£25.9m) from Full Tilt Poker.”
The payment processor in ques- tion has been widely reported to be Daniel Tzvetkoff, who was arrested
8 BettingBusinessInteractive • SEPTEMBER 2011
Full Tilt said that it had been dealing with that and other prob- lems thrown up by its third-party processors when the DOJ struck and seized its global domain name, shutting down the site worldwide. The company added: “Over the last four months, Full Tilt Poker has been actively exploring opportuni- ties with outside investors in order to stabilise the company and pay back our players. At least six of those groups, including hedge funds, operators of other internet busi-
nesses and individual investors, have visited Dublin to inspect the operation. “We have recently engaged an additional financial advisor through an investment banking group to assist us in our search for an infu- sion of cash as well as a new man- agement team to restore the site and repay players. While any deal of this nature is necessarily complex given the current regulatory environment, our players should know that Full Tilt Poker is fully committed to paying them back in full and restoring confi- dence in our operations.” The next hurdle for Full Tilt, though, is on 15 September when it will try persuading the Alderney Gambling Control Commission why it should be allowed its operating licence back. The regulator suspended the licence in June after a ‘special inves- tigation’ of its operations.
ANALYSIS
It is not the totally rosy picture painted by
Bwin.party as total revenue was down 3 per cent to 398.0m euro (£348.5m) which the firm attributes to competitive pressures in poker, the closure of French casino and comparisons with a period containing the FIFA World Cup. The firm reported clean EBITDA from continuing operations was down 21 per cent to 81.9m euro (£71.7m) due to the listed reasons, but also increased gaming duties from regulated markets. However stripping out the French casino, World Cup and increased gaming taxes, pro forma clean EBITDA was up 8 per cent to 98.9m euro (£86.6m).
NetPlay TV chairman Clive Jones has welcomed his firm’s return to profit after it recorded a profit before tax of £0.37m for the first half of the year. “We are very pleased to report a strong first half,” he said.” The return to profitability, cash generation and growth in our KPIs are a clear illustration of the benefits the restructuring has brought, and is a testament to the strength of the team that we now have in place. We are looking to the future with confidence and continue to explore opportunities to leverage our industry expertise and TV production facilities to facilitate further
expansion in both the UK and overseas.”
ASA DISLIKES JACKPOTJOY AD
The Advertising Standards Authority (ASA) has censured JackpotJoy after a promotion claimed: “Each new player gets one FREE spin on the Star of Joy with a top prize of £10,000. There’s a guaranteed win for each new player!” The ASA rules state that ‘items offered to a significant proportion of consumers in a promotion should be described as gifts, not as prizes’ and as such ‘considered the offer was a guaranteed gift not a prize, and concluded the ad was misleading’. The ASA added: “We considered the requirement to make a deposit was significant and should have been included in the ad, not in the terms and conditions.”
‘EXCELLENT’ CASINO PERFORMANCE
Henrik Tjärnström, CEO of Unibet, said the company’s gaming operations have had a mixed start to the year: “An excellent casino performance recorded another all time high. However, poker has remained a difficult market with little sign yet of any significant impact from the closure of some US-facing competitors. The Maria brand has continued to perform very strongly, also delivering all time high results with gross winnings revenue up over 35 per cent for the interim period compared to last year. Maria achieved excellent growth
especially in its casino and games products, which now account for over 60 per cent of Maria revenues. Maria is now our fourth largest market.”
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