Is online poker declining?
In recent years, the traffic of online poker is falling at a rapid rate, and there may be several reasons for this. According to the most recent PokerScout data, the average mobile traffic of the International PokerStars pool was 11,500 active players, the lowest in nine years. And over the past six years, the activity of the industry's flagship cash players has fallen by 50%.
In part, the negative trend for PokerStars can be blamed on problems with the regulation of online poker in many regions of the world, but there may be others, and there may be many.
Black Friday
The drop in traffic began in 2011, when the Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in the United States. However, it is interesting that the drop in player activity after Black Friday (April 15, 2011), when PokerStars was forced to leave the U.S. market, was not as sharp as expected. If you compare the traffic figures for July 2010 and July 2011, the decrease in traffic was only 6.4%.
The tangible impact began in 2012, with the average traffic of cash games being 11.7% lower than in 2011. However, the collapse of PokerStars only suffered until July 2012, when the advent of the then-innovative poker fast folds zoom stopped the fall.
However, the lull was short-lived. Over the past three years, the activity of cash players of the international pool of poker rooms has fallen by as much as 42.8%.
Although, we should note that in past years online poker was replaced by Bitcoin poker gambling. More and more new crypto gambling domains are being registered every month. This trend gained a foothold in recent years with the growing value of Bitcoin. Sites that offer to play with Bitcoin can be characterized with safety, increased speed of each hand and anonymity. People play poker with Bitcoins on these sites frequently considering these benefits and this tendency is likely to continue in the future.
Regulation
In recent years, several European countries have enacted a number of laws that have either forced poker rooms to temporarily leave their markets or significantly complicated the work of the industry's flagship.
In mid-2015, PokerStars left the Portuguese market. The creation of a regulated online poker market was approved in this country back in 2014, but active action is constantly delayed, and the online poker room is unlikely to return to Portugal before the last months of this year.
Since 2014, PokerStars has not been allowed to engage in advertising activities in the shadow market in the Netherlands.
Greece has introduced a tax on the proceeds of online gambling at 35%. Combined with other taxes in the country, the move forced operators to put Greek players in very unattractive terms.
PokerStars was also forced to leave the markets of Slovenia and Israel. However, the leader of the online poker industry intends to return to the Slovenian market soon after the new regulation comes into force.
New regulatory conditions in Poland and the Czech Republic put legal online poker operators at a disadvantage to offshore poker rooms and poker networks.
The Spin and Go Effect
Analysts blame the sharp fall in online poker traffic for the Spin and Go lottery tournaments that have become popular among recreational players, and there are reasons for this:
After the debut of the lottery format in September 2014, the popularity of Spin and Go grew at a rate of 10% per week.
The effectiveness of the tournament-related Spin and Go promotions was very high, and promotions lured a huge number of regular cash games to the lottery format tournaments. The above is a good reason to believe that the fall in the traffic of cash games by 18.8% from July 2014 to July 2015 is to blame for the growth of popularity of Spin and Go.
Changes in the business model
Since the purchase of PokerStars by Amaya Gaming Group, the approach to doing business has changed dramatically. In the last 12 months alone, PokerStars has introduced the following changes. Many of which have provoked a backlash from players:
- Reducing the maximum rakeback from 70% to 45% in 2016 and to 30% in subsequent years. High-stakes cash players are completely devoid of rakeback.
- Changing the schedule of key Sunday tournaments.
- Introduce a number of restrictions on the use of third-party software.
- Increase the rake in Spin and Go, hyper-turbo tournaments and head-up cash games. Introduction of rake on rebuys and addons.
- Holding new promotions that increase the importance of luck versus skill.
- Running expensive advertising campaigns with the participation of celebrities.
- And the most recent of the changes: depriving cash players of the option to hide their cards when putting all-in.
Since the introduction of most of these changes, the liquidity of cash games has fallen by as much as 31.5%. By comparison, in 2015, the decrease in traffic during the same period of the year was 21%, which roughly corresponds to the expected decline for the months in which online poker is the least popular.
Reducing interest in poker
The argument for PokerStars' innocence in the sharp drop in traffic may be a clear decline in interest in online poker in the industry as a whole. Traffic in other international online poker rooms has fallen by an average of 14.9% over the past 12 months.
However, it is worth noting that most of these operators have recently pursued a policy of attracting players to tournaments. In addition to lottery singles tournaments, as well as to online casino games and sports betting. Attention to cash games was minimal.
In other words, a drop in cash game traffic across the industry is an expected result, which is not the case with a sharp drop in PokerStars cash player activity.
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