BUSINESS

Amaya offers Q1 preview as PokerStars retroactively caps affiliate deals

TAGs: Affiliates, Amaya Gaming, PokerStars

amaya-pokerstars-affiliate-changesCanada’s Amaya Gaming has offered a preview of its upcoming Q1 financial results and instituted a significant policy change for PokerStars affiliates.

Amaya says it expects to announce revenue of between C$336m and C$342m (US $276m–$281m) for the three months ending March 31 when it releases its final numbers on May 14. The overwhelming bulk (C$333m–C$337m) of this bounty comes from Amaya’s B2C online gambling operations, which include PokerStars and Full Tilt.

The recently divested B2B assets of Diamond Game Enterprises and Cadillac Jack will be listed as discontinued operations in the Q1 report. Had their contributions been included, Q1 revenue would have reached a range of C$363m–C$374m. Amaya expects its former Chartwell and Cryptologic software divisions to follow the path into discontinued operations status in Q2.

AFFILIATE REVENUE SHARING CHANGES AHEAD
Meanwhile, PokerStars has instituted a new retroactive policy towards its revenue-sharing affiliates, capping formerly lifetime deals to a two-year maximum.

Rumors of the changes were confirmed in an email issued by Stars on Friday. The email states that as of June 1, Stars “will pay revenue shares to affiliates for only the first two years of activity on a player’s account. This will affect all referrals by affiliates, including retrospectively affecting those players referred prior to June 1, 2015.”

Stars said the change was necessary because “fewer and fewer new player acquisitions are coming from affiliate marketing.” Stars insists this change will reward affiliates who assist the company in “introducing the game to new audiences, rather than the current program which disproportionately pays affiliates for rake generated by existing players.”

Stars acknowledged that the change would have “a significant impact” on some affiliates but others who “choose to join us in growing the poker world” will enjoy a “great business opportunity” under the new environment. Either way, Stars believes players won’t see “any direct impact on their playing experience” from the changes.

This is the second major affiliate change since Amaya acquired Stars’ parent company the Rational Group in June 2014 for $4.9b and the cost-cutting measures began in earnest. That September, some of Stars’ ‘super affiliates’ had their deals terminated, although a Stars spokesman later stated that the cull involved “a very small number of affiliates who were not recruiting many new players, and who were doing little active promotion of our services.”

Comments

views and opinions expressed are those of the author and do not necessarily reflect those of CalvinAyre.com