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According to PokerScout.coms’s Scouting Report, the downward trend for Nevada online poker finally appears to be coming to an end – but it may be months still before the industry observes notable gains.
The revenue figures for December 2014 through February 2015 are based on PokerScout’s internal projections. The Nevada Gaming Control Board stopped releasing revenue figures when Ultimate Poker’s closure dropped the number of sites from three to two (WSOP NV and Real Gaming).
PokerScout’s approximations paint a somewhat harrowing picture of Nevada’s online poker industry, one in which the market continued to post month-over-month losses during a time when traffic levels are typically on the rise:
Presuming PokerScout’s estimates are as accurate as they have been in the past (and they have been quite accurate), then Nevada’s iPoker industry has been mired in a state of steady decline since July, when the presence of the live WSOP propelled the Silver State’s online gaming market to its first and only seven-figure revenue tally ($1,037,000).
Here’s a glance at monthly revenue figures since then:
On a more positive note, it does appear that the rate in which the market is hemorrhaging money has slowed to a near halt, and may even be in the process of reversing.
From January to February, revenue estimates only fell 1%. That slight negative becomes a positive when one breaks revenue down into daily averages.
As per the Scouting Report, daily averages in February were $20,500 versus $18,800 the month prior – a 9% month-over-month increase.
That being said, year-over-year tallies are sharply down.
Last February, which also happens to have been the first month Nevada regulators released revenue figures, the state’s poker rooms generated $824,000. The latest revenue estimates represent an alarming 44% percent year-over-year decline.
While Ultimate Poker’s withdrawal from the market undoubtedly impacted the industry’s bottom line, other factors such as:
… all likely played contributing roles.
Given the market’s inability to produce month-over-month revenue gains during the winter and its significant year-over-year falloff, logic dictates that the spring will bring with it even lower revenue tallies.
But the circumstances in Nevada are quite unique.
As per the Scouting Report, “Nevada’s revenue trends defy conventional wisdom, which dictates that winter is generally the strongest season for online poker.”
The reasons stated for this are threefold:
It’s worth noting that this year’s WSOP will feature both a live event expected to draw at least 10,000 runners (the $565 buy-in Colossus), and an online bracelet event.
On the basis of these two new additions alone, it stands to reason that WSOP.com will attract even more traffic this summer than last.
Factor in what will presumably be a tighter, more focused cross-promotional effort between the live Series and the online product, and the sky’s the limit.
Still, in reality, the live WSOP is little more than a band-aid solution that will temporarily mask the market’s downward momentum until the final bracelet is awarded.
Then it’s up to the operators themselves to explore long-term solutions, especially with regards to increasing liquidity.
An imminent player pooling compact with Delaware is a promising start, but benefits Delaware players significantly more than their Nevada-based counterparts.
The real elephant in the room is New Jersey, an industry which may have initially scoffed at the notion of entering a liquidity compact with a state featuring a population of less than 3 million, but now faces serious revenue problems of its own (New Jersey poker sites generated just over $2 million in February 2015).
A compact with New Jersey elevates player counts just over the critical mass necessary to sustain a fruitful poker ecology, and will undoubtedly result in higher monthly revenues for both states and bring increased attention to regulated online poker.
Now it’s just a matter of making it happen.