Between governments cracking down and backing down, continued global growth, and online forays into land-based gaming, 2012 was a banner year for big news in the poker industry. Here’s a look at some of the biggest stories of the year.
U.S. federal government impotence on online poker
Harry Reid is ostensibly the most powerful man in the United States Senate, but for two years running he has failed to send an online poker bill to the president. In 2012 he worked together with Arizona’s lame-duck, anti-gambling senator Jon Kyl and still couldn’t help the gaming giants in his home state of Nevada claim the U.S. online poker market for themselves. Reid’s fellow senator from Nevada, Dean Heller, still insists that the federal online bill isn’t dead. But realistically, the chances of it seeing the light of day are next to none.
Preet Bharara’s failure to launch might be even more embarrassing than Harry Reid’s inability to wrangle the Senate. The Assistant U.S. Attorney for the Southern District of New York kicked off his case against the former owners of Full Tilt Poker by declaring the company a “Ponzi scheme” and grabbed headlines from compliant mainstream media sources. But those bold declarations didn’t buy Bharara any real ammunition against Chris Ferguson, Howard Lederer, Rafe Furst, or anybody else formerly associated with Full Tilt Poker.
More than 15 months after filing an amended civil complaint against the three, only Ferguson has yet to settle. Just one week ago Lederer came to an agreement with Bharara’s office that saw him admit no wrongdoing while forfeiting $1.25 million and some Las Vegas property. That’s not the kind of result anyone should expect from a prosecutor of Bharara’s stature who kicks off a case with a press conference. If he strikes out trying to pin the blame on Ferguson in 2013, the whole episode is going to reflect really poorly on him.
Not only could the feds not land any convictions against the former heads of Full Tilt, they couldn’t find a way to have their preferred buyer take over the company. The Department of Justice’s long-gestating deal with Groupe Bernard Tapie finally fell through in late April after GBT claimed that the DOJ made “11th hour” demands for full repayment of all players within 90 days. GBT’s plan had been for players to be able to withdraw $100 from their accounts and ten subject the remaining balances to playthrough requirements.
With the French group out of the way PokerStars landed in the catbird’s seat and quickly took advantage, striking a bargain with the DOJ to buy Full Tilt for $547 million over three years. Stars also paid $184 million to players outside the U.S and set aside another $150 million for American players who had money tied up in the site on Black Friday. The deal brought civil forfeiture proceedings against Stars to an end and set the company up for the possibility of doing business within the U.S. again at some point in the future. By year’s end Full Tilt was up and running – and once again in its spot as the world’s #2 online poker room.
While the feds chased their own tails in D.C., several states moved forward with plans to start taking advantage of the tax possibilities of legal online poker.
In New Jersey, the state assembly and senate both passed legislation to license online poker. Governor Chris Christie vetoed a similar bill last year, but this year’s version was revamped to address his concerns. The bill also ditched its “bad actor” clause, potentially opening the state up to companies like PokerStars. (More on that in a bit.)
In Nevada, meanwhile, the state gaming commission gave the nod to no less than 17 providers during the 2012 calendar year. Most prominent among them is Caesars Interactive, the online branch of the company that owns the World Series of Poker. If its partner, 888 Holdings, also earns approval from Nevada, online satellite tournaments to WSOP events all over the world could become a reality in the very near future.
The World Series of Poker has been the world’s premier poker tournament series for more than 40 years, and this year it set the stage for an even brighter future. During the 2000s, the story of the World Series of Poker was the massive growth in tournament field sizes and prize pools. This decade the venerable tournament series is poised to make its story all about putting the “World” in World Series.
WSOP Asia-Pacific, set to be held at Crown Casino in Australia next April, will mark the WSOP’s third overseas venture in recent years. After five years and two different homes, WSOP Europe is preparing to move to Paris for what should be its biggest installment to date. And WSOP Africa, which has been part of the WSOP Circuit schedule for two years now, will expand to six events this year including a $10K high roller event. WSOP Executive Director Ty Stewart has spoken of a desire to “establish the worldwide grand slam of poker and use our platform to elevate the game through a series of major championships,” boding well for the long-term future of tournament poker.
China has been poker’s “market of the future” for a long time now. This year saw it become a market of the present with two high-profile tournaments, the $250,000 Macau Super High Roller and WPT China.
Macau has been hosting tournaments for several years now. But the $250,000 tournament drew a field of 73 players and awarded more than $25 million in prize money, making it one of the richest poker tournaments in history. The WPT’s foray into China was a long time coming – the company first began trying to penetrate the market when Steve Lipscomb was still the CEO. WPT China sold out weeks before it ever began and drew players from that all over that country and the rest of the world.
Perhaps most importantly in terms of poker history, both tournaments were won by Chinese players. Stanley Choi won $6.46 million in Macau, while Zheng Hua Lei won a more modest but still impressive $192,406.
In Europe, Stars bought into joint ventures with the Hippodrome Casino in London, Circus Groupe in Belgium, and Gran Casino Madrid in Spain. The company also made a similar deal with the Grand Waldo in Macau. Perhaps most surprisingly, PokerStars is trying to purchase the failing Atlantic Club Casino in Atlantic City, New Jersey. Not only is the company not facing major opposition as it might have in the past, but prominent New Jersey state senator Raymond Lesniak is actually backing the bid.
The traditional point of view has always been that land-based casinos would take over the online business. PokerStars’ moves suggest that the way of the future is going to be online companies strategically investing in land-based enterprises to bolster the online business.
With poker’s popularity at an all-time high in Europe, some governments there have decided to crack down on poker players. Sweden did so in dramatic fashion in late November, launching coordinated raids on the homes of online poker players around the country and confiscating computers from some of them. The Swedish government used data-mining sites to hunt for players who hadn’t paid taxes on their winnings. In nearly bankrupt Spain, the focus is on live tournament players. The government there is also relying on the internet for its data – the Spanish authorities are using The Hendon Mob’s database to determine who has won what. If these governments’ tactics prove even remotely fruitful, expect to see more of this sort of thing in 2013.