Player liquidity and consolidation have been two key words in the online poker industry for a number of years now. Player liquidity has been the ultimate goal and driving force for many companies, and it has been repeated so many times that is has become a “truth” nobody challenges. Another similar buzz word is consolidation. For how many years have we heard that consolidation of the online gaming industry is around the corner? In a way the two are related—consolidation is a very effective way to create big player liquidity quickly.
I think the industry is now heading in the opposite direction. We will have balkanization instead of consolidation, and player liquidity will no longer be viewed as the key to success.
The PWin merger is, of course, big news in the industry but I do not see that as the start of a consolidation phase. As Steven Stradbrooke pointed out in his analysis of the merger, there are a number of question marks around how successful this merger will be and the driving forces behind it. More recently, the stock market has given its verdict.
Striving for player liquidity has been a way of catering for the winning players. Remember, that before Bodog opened up the debate about depositing players versus winning ones, these winning players were considered “high rakers” and everyone was competing for them. It feels like a long time ago now but it was actually less than two years ago. Having a large pool of net depositing players was a way of competing for these winning players, but the user experience of the net depositing players was not seen as important.
As a natural consequence of the focus on player liquidity everyone has expected the online poker industry to enter a consolidation phase. However, the consolidation issue was challenged more than a year ago and Kim Lund, an e-gaming analyst, wrote a series of articles on liquidity in October 2010.
Sure, to run a successful poker room you need a critical mass to keep the games going, but after you have achieved that level of players, liquidity is not key anymore. The battlefield of the future in my view is entertainment and since different players have different ideas of what is entertainment is we will for the first time in the short history of online poker start to see differentiation in poker rooms.
Some players may find it important to be able to chat in their own language, others may want a user experience close to what you can get playing a video game. Some players may find tournaments with huge fields more entertaining than small fields. For those players, player liquidity will continue to be an important entertainment factor, but for the majority of players, liquidity has a small part to play of the total entertainment package.
Vice President, Bodog Network