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PokerStars-FTP Deal: What it Means for Poker
PokerStars.com's upcoming acquisition of Full Tilt Poker and settlement with the Department of Justice has far-reaching implications for the poker industry and players around the world.
From player restitution to the further consolidation of the global online poker market, this deal will play out alongside the regulation of online poker in the US to shape the poker landscape over the next few years.
And while the return of hundreds of millions in player money is certainly the most visible result of this deal, and the most welcome, the impact will be felt in many ways by many people.
In this insider analysis of the PokerStars/DOJ/Full Tilt Poker agreement we’ll take a closer look at the biggest business deal in online poker history and what it means to you.
Cash Infusion for Poker Economy
The sums of money being thrown around in this deal are enormous.
First of all, PokerStars has agreed to forfeit $547 million to the US government over the next three years, and that doesn’t even take into account the roughly $184 million in player funds PokerStars must pay back to non-US players.
$150 million of PokerStars’s forfeiture will be used by the US government to pay back Americans with money stuck on Full Tilt.
In total $334 million is expected to be returned to former customers of FTP. And while not all of that will go directly back into poker, the infusion of funds will absolutely have an observable effect on the poker economy.
The effect will be most pronounced in the overall online poker industry metrics. A large number of accounts that have been inactive since FTP shut down will be up and running instantaneously.
Recreational players with small amounts of money on Full Tilt Poker will go straight back to the tables, while professionals and high-stakes players will either pick up where they left off on FTP or transfer the money to the sites at which they’ve been playing since Black Friday.
Many non-US players on Full Tilt Poker who stopped playing altogether after Black Friday will begin playing on FTP as soon as their money is available and the site is up and running.
In the US the effect will manifest in live cash games and tournaments, until regulation allows Americans to once again play poker on the internet.
A large number of player-to-player debts will also be resolved. Patrik Antonius, for example, will have a chance at recouping the roughly $5 million in debt he told PokerListings.com about last October.
PokerStars and Full Tilt Dominant Again
In the era between the introduction of the UIGEA and Black Friday the online poker industry was defined by PokerStars and Full Tilt Poker.
That status quo will soon return and will not end until online poker is regulated in the United States.
According to today’s announcement PokerStars will have Full Tilt Poker up and running within 90 days of when the deal with the DOJ is finalized.
The only difference now is that instead of two companies competing against one another, both of the biggest sites will be operating under the umbrella of PokerStars.
PokerStars will be able to shape the online poker experience for the majority of the world’s players, and it will give them the opportunity to offer more varied online poker products.
It remains to be seen how PokerStars will choose to differentiate the two rooms, and how much of the pre-Black Friday Full Tilt brand they choose to retain.
The re-introduction of Full Tilt into the online poker market also has big implications for smaller poker sites like 888poker and Party Poker.
These rooms have been doing a great job of differentiating themselves from PokerStars through software improvements and player incentives but they'll have to step it up to hold their own as the online poker space becomes more competitive.
Re-Branding the New Full Tilt Poker
PokerStars announced that they will hire an entirely new management team to run Full Tilt Poker from the existing offices in Dublin, but that regulatory control will be transferred to the Isle of Man.
But while separate teams will be running PokerStars and Full Tilt, you can bet top-level decisions regarding both sites will be made by the same people, and that those decisions will have cooperation in mind.
With two separate sites at their disposal PokerStars should be able to broaden their appeal. But whatever route they take they will have to differentiate their two products.
Most professional poker players take into account a mix of game selection, difficulty of competition and rakeback/rewards programs. These are the main ways PokerStars can cover more bases with two separate sites.
PokerStars has always had a VIP rewards program while Full Tilt Poker did straight rakeback. Some have even suggested a joint rewards program whereby players could accumulate points playing on both sites.
While professional grinders are drawn by the site that’s best for their bottom line, recreational players are more swayed by image, marketing and how much they feel they can trust the site.
And one thing PokerStars does well is marketing.
It seems likely that the new Full Tilt Poker will attempt a fresh start which means PokerStars will be looking for a fresh crop of big-name poker pros.
They may bring along marquee names like Tom Dwan and Patrik Antonius, people who made it through Black Friday with their integrity intact, but a new site should have a new face. And it should be as different from the old face as humanly possible.
PokerStars and Full Tilt Poker to Return to United States
PokerStars and Full Tilt Poker became the biggest online poker sites in the world post-2006, after continuing to offer online poker to Americans despite the introduction of the Unlawful Internet Gaming Enforcement Act (UIGEA).
Since Black Friday the common conception has been that Stars and FTP would never do business in the US again, as punishment for disregarding the UIGEA.
According to today’s announcement that’s not the case.
“We are delighted we have been able to put this matter behind us, and also secured our ability to operate in the United States of America whenever the regulations allow,” said Mark Scheinberg, Chairman of the Board of PokerStars.
The next biggest developments in the poker world will be the rise of the new Full Tilt Poker, and the regulation of online poker in the United States.
Depending on the route that US legislation takes, those two storylines might very well intersect.
If PokerStars and Full Tilt Poker are able to get in on regulation in the United States, it’s difficult to imagine a more appealing place to play for Americans.
The software, expertise and experience that PokerStars brings to running an online poker site will make it very difficult for brick-and-mortar operators to compete.