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Fast-forward five months, and that outlook has shifted from sure thing to long shot.
PokerFuse is reporting that PokerStars’ launch in NJ is now postponed until 2015, noting that “[p]olitics are being cited as one of the hurdles that have yet to have been cleared.”
A number of individuals with knowledge of the process have confirmed to OPR that PokerStars’ New Jersey launch is encountering unanticipated delays.
But the nature, severity and ultimate cause of said delays are the subject of no small amount of debate.
More on that in a second.
First, some quick context as to why the consensus expectation was that PokerStars would be up and running rapidly in NJ:
But that momentum dropped off dramatically – and unexpectedly – sometime in early October.
Neither the DGE or Amaya / PokerStars have offered any comment on the situation.
The last time the DGE responded to a request for comment was to confirm on October 17 that the “Amaya/PokerStars acquisition investigation remains open and ongoing.”
In the absence of any official explanation, a number of theories have been offered, publicly and privately, to account for the gap between the expectations of a fall launch and the reality of a delay bordering on the open-ended.
This was the explanation I heard most often when rumblings that the process had fallen off track were just starting to gain steam in mid-October.
In this narrative, there is an unspecified delay in the technical investigation process, caused by a bottleneck on Stars’ end or on the DGE’s end, or some combination of the two.
The appeal of this explanation has faded as the delay has stretched on.
But it was one that made sense to me – technical investigations can get hung up at any number of points. For example: I could see PokerStars deciding to try to push through a newer version of the platform than the DGE had previously seen and encountering some delays as a result.
And, given the gravity of the approval, it’s easy to see why the DGE would want to take things slow and steady.
This explanation – or some version of it – has become increasingly popular among credible industry sources over the last week or two.
In this narrative, Gov. Chris Christie is delaying the decision on PokerStars (and, depending on who you ask, may ultimately quash the application) to curry favor with mega-donor Sheldon Adelson, both to help secure Adelson’s support for Christie’s presidential run in 2016 and to prevail upon Adelson to build a casino in the Meadowlands.
I continue to believe it doesn’t quite pass the smell test.
Some of the immediate questions that come to mind include:
… but that doesn’t mean it isn’t happening.
This is something of a variation on #1, but distinct enough (and repeated enough) to break out, if only briefly.
In this narrative:
This story requires fewer leaps of faith than #2. And it offers a plausible explanation for the “delay, but don’t deny” status that some perceive to be hanging over Stars’ application.
Finally, it explains (at least to a degree) why Christie would suddenly spring to action weeks into the process: His perception of RAWA’s chances in the lame duck evolved.
One of the more intriguing (albeit less popular) theories.
In this narrative, Christie’s administration recognizes the immense amount of leverage they hold with Amaya, a company that took on billions in debt to acquire PokerStars with a payback plan at least partially predicated on accessing the emerging US market.
Needing some sort of win to help counter the massive gap between official administration revenue projections for regulated online gambling and reality, the Christie administration ups their ask from Amaya, demanding a partial – or even total – relocation of PokerStars’ global operations, and the hundreds of jobs and millions in economic activity that would come with it.
When PokerStars’ NJ license application was paused by the DGE, the agency offered the following comment:
The Division’s determination is based primarily on the unresolved federal indictment against Isai Scheinberg for the alleged violation of federal gambling statutes, namely, the Illegal Gambling Business Act and the Unlawful Internet Gambling Enforcement Act (UIGEA), and the involvement of certain PokerStars executives with Internet gaming operations in the United State following the enactment of UIGEA.
In this narrative, the sale of PokerStars / Rational to Amaya satisfied the “primary concern” (Scheinberg) by severing ties between Scheinberg and the company.
But, the speculation then goes, Amaya failed to satisfy the “certain PokerStars executives” condition implied in the statement, and the delay hangs on negotiations between the DGE and Amaya on who should stay and who should go.
It doesn’t stretch belief that the DGE might not have had a definitive strike list when the application was paused and that a new name (or names) may have come on their radar post-purchase.
And finally, the most pedestrian explanation (although Occam would be a fan): PokerStars isn’t being held up by Christie or the DGE, but instead by PokerStars.
In this narrative, in the aftermath of a rapid, radical acquisition by Amaya – one kept incredibly well under wraps, and presumably a surprise to the vast majority of staff – PokerStars simply isn’t able to pull together the product they want in time to keep pace with the regulatory process.
Why it makes sense:
Why it doesn’t:
When this chapter of PokerStars’ saga in New Jersey is closed, it may come to light that none of the above explanations actually account accurately for the delay.
Or that some combination of politics, logistics and personal agendas not so neatly boxed into a coherent narrative is to blame.
In any case, the chapter now seems unlikely to end before the year is out.