Before I start I’d like to thank everyone for their kind words about the PartyGaming situation. It sucks and although I’m going to miss the money (Not to spend myself but, to grow the company) as an affiliate I drive players to poker rooms. It isn’t the other way around, I know that a good number of players won’t play on Party if they can’t be retagged to a reliable and rewarding affiliate.
I do however, want iPokerVIP to have the best lineup of deals in the industry and obviously this has put a dent in that plan, for now. I think we’re almost there with iPoker and by the end of 2010 we’re aiming to make serious inroads into OnGame and Microgaming. Our player base is steadily growing but, we’re nothing on RakeTheRake.
Anyway, around the end of July this year BWIN, the owners of the OnGame poker network and Party merged. It was pretty cool to see something that will effect everyone associated with the industry getting so much public press.
The #1 question for players is: When or Will PartyGaming and OnGame merge their poker platforms. In my opion this answer is a resounding yes…
Software, game standard, rewards and affiliates are meaningless on a network or site with poor liquidity. Traffic is king when it comes to online poker. There are a few great networks out there; flawless software, amazing support and a generous rake structure mean nothing when you don’t have the traffic to back it up. How to get the traffic? If I knew that I’d be rich, I’ve got a few ideas but, I’ll save them until I get a site. Its something I want to do but, it needs to be done right and have significant investment. I’ll save that discussion for another day.
A great example of one of the ‘flawless’ networks is Melita.
They’ve got the time bank that seems to have eluded iPoker for years now. An interface that genuinley competes with stars and far lighter software than FTP. As for OnGame and Microgaming its completley left them in the dust.
I know shareholder’s in Melita pretty well and think the network represents a great opportunity and I wish I could invest but, I don’t have the capital or the experience. The sad fact is that the network dies a slow death far too many times, probably in excess of 50%.
A review on PokerScout summarises Melita as a network with “no traffic, good software,good support”.
Anyway, enough free marketing for Melita. I wish them the best of luck in the future, a breath of fresh air is exactly what this industry needs.
So: Liquidity is King…
If OnGame and Party were to merge we could expect a network with 40k players online during peak times and it would inevitably grow.
Canibilisation will be a genuine concern for Party. If jokepoker or some other small skin were to close at OnGame tommorow I’d imagine 80% of the players would be playing on another OnGame skin within a fortnight. The exact same applies to signups, players can access the liquidity and game softness BWIN and Betfair provide at a fraction of the effective cost.
When Tom, Dick and Harry skin make the jump to Party they’ll be rubbing their hands and counting the money. Unless strict policy was put in place (which I think would be pretty hard and not necessailly discussed in the merger talks – It seemed to be more of a progressive merger, geared towards America and virgin markets as opposed to one focused on the present. In fact who knows how much time they devoted to discussing poker) the migration of current Party traffic to these sites would be enourmous. Regardless of rakeback or VIP caps I’d imagine the little guys would be easily tempted into making easy some money.
Currently the most popular deterrent for these guys are fines. Ranging anywhere from $15k – $75k they sound pretty hefty. If these skins bring in $250k MGR breaking the rules this fine isn’t so serious and is just a cost of doing business. In fact the skin will still probably remain profitable for that month in question.
What happens to that $250k of monthly rake once the skin has been fined? The players are pretty much allowed to remain on the same deals.
Networks have also been known to terminate their agreements with certain sites (NOIQ on iPoker & recently PotRaiser on Entraction). The problem is by the time the skin has been chucked they’ve acculmulated an impressive database and ofcourse are making the network a handsome sum each month. Its an awkward process and its obvious why the network’s don’t go down this route reguarly.
Back to Party & OnGame – These guys have seen this go wrong far too many times and need to remedy it. Its evident the convential methods aren’t quite cutting it. As an affiliate I consider myself lucky because I can see what’s happening on grass roots level but, sometimes get an idea of what might be going on higher up.
If the current methods aren’t desirable Party and OnGame need to make sure they don’t take too much baggage with them. They’ve done one thing that will ensure this (whether intentional or not).
The new OnGame rake system: Essence.
In a nutshell Essence rewards losing, recreational players more and winning players less. Its been hailed as the answer to the industry’s problems but, OnGame failed to mention an almost idential system is being used by Bodog and fell flat on its face. Recreational players are ofcourse an important part of the poker ecosystem but, they do not play to grind out rakeback or fpps… at first they play for entertainment or to qualify for a live event. Fish don’t estimate their % of rakeback, or calculate their BB/100… and attributing them more rake ultimatley means less money leaves the big skins pockets.
Ofcourse the smaller skins have been hit hard. Their figures have been slashed by around a 1/3rd and it inhibits their ability to acquire more big rakers in the meantime.
On top of this, the regulation of under the table deals has tightend up significantly. One way or another Tom, Dick and Harry won’t be making their way over to Party with BWIN.
Party seem keen to reactivate players and rejuvinate traffic. All sites are but, I feel these new deals are coming out to tag as many players to Party as possible before a migration. We might see a system where a player can only have one active account at each skin that’smore heavily policed for under the table deals than any before.
On top of all of this we need to look at the sheer cost of a complete software overhaul at OnGame. Based on other network software costs we’re looking at in excess of 7 figures and Party have software sitting right there.
So, in short… The merger is an inevitability. They just need to do it right. I find it reassuring that all the untagged Party players will find their way to whichever skin iPokerVIP works with. In return for their loyalty they will be rewarded extremely highly and enjoy the service they’ve come to expect from iPokerVIP.
Peace
