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It was announced on Tuesday that there is an anonymous French Investor willing to step in and pay back the $300 million owed to their players.
Ummmm…. Wow!
HA… there is a “but.” (There always is… right?) Although this will totally deliver the salvation Full Tilt Poker’s players are in dire need of, the BUT is that Full Tilt Poker would need to get rid of its Alderney Gambling License.
Decisions, decisions. Check-out more details here.
So, do you think this is the answer to Full Tilt’s prayers? Or should other solutions be sought after?
I’ll believe it when I see it.
Why would a french investor come in and pay 300 million for a network which is 85-90% US based?
Somethings not right?
Between affiliate costs, rake back bonuses, sign up bonuses and thin margins in online poker in general, it is really tough to make money. It is not likely that any company/investor could take on that kind of debt and presume to make a dime.
All of these poker companies that are paying their managers and executives large salaries, operating out of lavish offices, spending millions on marketing and advertisement, etc, are all likely operating under a flawed business model. They are all ponzi schemes in one way, but then again, a bank does operate in a similar way. Is operating an online poker company any more a scheme then a bank? I am not one to speak well of the banking system, however I would have to say that the online poker industry is a far cry from legitimate. Currently, it is not regulated, there are no strict guidelines on how much escrow they need to keep, and quite honestly, there are plenty of unscrupulous characters in the industry.
@cmcdonnell 231955 wrote:
Between affiliate costs, rake back bonuses, sign up bonuses and thin margins in online poker in general, it is really tough to make money. It is not likely that any company/investor could take on that kind of debt and presume to make a dime.
All of these poker companies that are paying their managers and executives large salaries, operating out of lavish offices, spending millions on marketing and advertisement, etc, are all likely operating under a flawed business model. They are all ponzi schemes in one way, but then again, a bank does operate in a similar way. Is operating an online poker company any more a scheme then a bank? I am not one to speak well of the banking system, however I would have to say that the online poker industry is a far cry from legitimate. Currently, it is not regulated, there are no strict guidelines on how much escrow they need to keep, and quite honestly, there are plenty of unscrupulous characters in the industry.
I tend to agree here, but you can make money if enough scale is behind you (obviously Stars and Tilt both were putting away hundreds of millions, legitimate or not). The business model itself is clearly not flawed, it is more so the behaviors of the guys running these unregulated companies.
The real question is – how much scale does/did FTP have outside of the U.S. and is that maintainable? Surely a new owner can do away with the inordinate amount of expenses Bitar and others were putting through the company and make this business profitable. It would be a real challenge getting affiliates to promote them again and obviously the new owners would need to address the availability of player funds through some 3rd party to alleviate that concern going forward.
FTP does have a product that millions of players enjoyed and were fiercely loyal to so now it comes down to really what potential is left. I still think it’s still a salvageable business…at the right price.
@cmcdonnell 231955 wrote:
All of these poker companies that are paying their managers and executives large salaries, operating out of lavish offices, spending millions on marketing and advertisement, etc, are all likely operating under a flawed business model.
The poker business model makes more sense the casino business model.
With poker, if your room is raking 1mill a month, you know exactly what your gross earnings are, affiliate payments, fees etc.With Casinos it doesnt work that way, you can be a room who has pulled in 500k in deposits, but if you have a run of winners who – you’re losing money, how much you dont know, even though you pulled in 500K a month in deposits.
The next month, that 500K in deposits might not have many winners, and you could be sitting in a better position.@Rak 232041 wrote:
The poker business model makes more sense the casino business model.
With poker, if your room is raking 1mill a month, you know exactly what your gross earnings are, affiliate payments, fees etc.With Casinos it doesnt work that way, you can be a room who has pulled in 500k in deposits, but if you have a run of winners who – you’re losing money, how much you dont know, even though you pulled in 500K a month in deposits.
The next month, that 500K in deposits might not have many winners, and you could be sitting in a better position.Short term loses/gains in a casino should be expected in any smart business plan when opening/operating an online casino, however unless there are some outside forces having an impact on the payout percentages (flawed game, software manipulation, etc), in the long run, the casino should always win. Casino payouts are based on simple math and set payout percentages. So while your statement is true, it also doesn’t really have much relevance at a table between people who would be forecasting a budget or business plan for an online casino, unless they didnt have the proper startup cash, in which case they probably shouldnt start up the business to begin with. If you have reliable software, good people to manage and maintain it, quality cs and a few other key elements, then you just have to worry getting those customers through the door
.@Rak 232041 wrote:
The poker business model makes more sense the casino business model.
With poker, if your room is raking 1mill a month, you know exactly what your gross earnings are, affiliate payments, fees etc.With Casinos it doesnt work that way, you can be a room who has pulled in 500k in deposits, but if you have a run of winners who – you’re losing money, how much you dont know, even though you pulled in 500K a month in deposits.
The next month, that 500K in deposits might not have many winners, and you could be sitting in a better position.And to add, to say “The poker business model makes more sense than the casinos business model”, that is a tough argument to backup. I understand that the feeling of security that you get from basically “knowing” how much money you will make each month is nice, but I would rather operate a great online casino product and keep 100% of the revenue instead of taking a small piece of the rake.
@Rak 232041 wrote:
The poker business model makes more sense the casino business model.
With poker, if your room is raking 1mill a month, you know exactly what your gross earnings are, affiliate payments, fees etc.With Casinos it doesnt work that way, you can be a room who has pulled in 500k in deposits, but if you have a run of winners who – you’re losing money, how much you dont know, even though you pulled in 500K a month in deposits.
The next month, that 500K in deposits might not have many winners, and you could be sitting in a better position.I suppose casinos have to disregard short term reports because of the luck factor. They probably pay more attention to quarterly reports.
@shineray22 232070 wrote:
I suppose casinos have to disregard short term reports because of the luck factor. They probably pay more attention to quarterly reports.
Player value plays an important part. As in deposits per player over a 12month period. Need deposits to keep coming in to pay those winners.
This has been a quiet subject over the past few weeks, however Full Tilt Poker and Group Bernard Tapie is still in the works- and apparently a deal is forecasted to be made in the near future. There’s even been negotiations between Group Bernard Tapie and the US DOJ.
More info here: Full Tilt Poker and Group Bernard Tapie Deal Still in the Works
Obviously, there’s rumors galore regarding offerings to FTP European based players to roll over funds and putting together payment plans. However, since there’s no final deal, players and affiliates are still in the dark on any information regarding their long overdue payments.
With the latest developments… what your thoughts for the possible new direction?
@JillO 232660 wrote:
With the latest developments… what your thoughts for the possible new direction?
Personally I wouldn’t touch it.. so high risk. They are getting sued by groups here and there.
Only reason I can see why it would be taken over my B.Tapie.. is saying to the DOJ.. ok we’ll do what we need to, and then clean up its act, and go in and work with a US group when regulation starts. FT has been very popular with US players.
