January 2009

What's In The Cards? A Look Ahead At Poker in 2009 by Jennifer Newell

Any game, or sport if you will, goes through its ups and downs over a span of years. Poker is no different and has maintained, as most successful games or sports, a fairly consistent rise over the past few decades, with two very notable exceptions. One was the Moneymaker effect, as has been written about at great length since Chris Moneymaker actually won the World Series of Poker in 2003, which prompted an exponential increase in the number of people who played and watched poker. The other was the UIGEA, which caused the game’s popularity to sink, notably but not catastrophically, since its passage. The Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) passed through the U.S. Congress as title VIII of a completely unrelated bill, the Safe Port Act, HR 4954. UIGEA essentially makes it unlawful for banks, payment processors and other institutions to send money to Internet gambling sites or their intermediaries.

The downturn that poker experienced since the passage of the UIGEA wasn’t so much in popularity, but when numerous online poker sites withdrew from the U.S. market and refrained from sending international players to U.S. poker tournaments via online satellites, while other sites merely folded from lack of U.S. players to sustain their bottom lines, the poker market as a whole took a hit. Besides the obvious harm to the online poker industry, the trickle-down effect was evident in all aspects of poker, including magazines, websites, and live tournament poker.

But even so, a strange thing happened at the 2008 World Series of Poker. There was an increase in the number of players from two years prior, and the prize pool for the main event soared to its second highest ever, with the only exception being the pinnacle year of 2006. Players came from more countries then ever before, and the 2008 WSOP was a stunning success, more so than most had predicted. The game continues to grow. Despite the U.S. government’s efforts to prevent online gaming from persevering, much less thriving, more and more people find a way to play online every day. And while the American live tournament circuit seems to be stagnant, if not suffering somewhat, the rest of the world is making up for the deficit with consistently strengthening markets in places like Asia, Europe, and Latin America. Where one aspect of the game may lack, another will more than make up for it.

Poker seems to be as resilient as its players. It takes bad beats, like the UIGEA, and keeps finding new ways into the lives of players everywhere. Why? Because card games are a global pastime, and poker has gone from a kitchen table game to a viable career for countless individuals. It has gone from what some predicted would be a fad to a staple in homes, casinos, on television, and in film. Poker references pervade political speak, and the 44th president of the United States, who has played the game for years, takes that love of poker into the White House on January 20, 2009.

To predict any rise or decline in poker for 2009 is a dicey task because all signs point to a rocky year. There is likely to be growth in some areas of the industry, while the U.S. market is relatively unsure about the strength of its hand. Let’s take a look at some of the aspects of poker to be considered over the coming year.  

Live Poker — Tournaments and Cash Games

In the broad sense, tournament poker in live venues is on the upswing. More tournament series are popping up in casinos around the world than ever before, and players show up with the buy-in at the ready to play for career-changing or life-changing money. But that trend many not be apparent by looking at one or two U.S. series. While the World Series of Poker was very much a success in 2008, the World Poker Tour was not so lucky. Not only did the company remove several stops from its tour, but it experienced a number of financial setbacks due to non-renewed television deals and an unsuccessful online gaming venture. The casinos remaining on its seventh season tour have seen declines, sometimes as much as more than 100 players per stop. There are two factors that likely contributed to the reduction in WPT players: the crumbling U.S. economy and the opportunities presented by other poker tours around the world. The U.S. economy has been sinking toward a recessionary state for quite some time, and there is no immediate end in sight. Poker players, like most other people in America, will be feeling the effects of the economic crisis throughout 2009. While there will always be those with monstrous bankrolls to enter the $10K and $15K tournaments, as well as those who win their seats through online poker sites, the numbers will likely continue to drop somewhat in the U.S. for tournaments like the World Poker Tour.

However, the tournament series that continues to grow and make an impact on tournament poker is the Heartland Poker Tour. With main event buy-ins of under $5K and preliminary events under $1K, and locations around the Midwest region of the United States, players find that they don’t have to travel far, spend a great deal on accommodations, and still have the opportunity to reap the benefits of winning substantial tournament prize money and find themselves on television. And the HPT continues to draw bigger crowds as it gains prestige and has become a solid alternative to high-stakes WPT events. Additionally, other tournaments popping up in various parts of the world will likely grow in popularity and attendance. The European Poker Tour has been on the rise for years, and with more reasonable buy-ins than the U.S. majors, the EPT should continue to see capacity crowds at each of its increasing number of stops on the tour. Similarly, other poker tours are growing, though not at the pace of the EPT. The Asian Poker Tour, Asian Pacific Poker Tour, and Latin American Poker Tour are expanding and seeing more of an interest in countries that have never before seen poker played at the prestigious tournament level. These tours will likely see escalated attendance over the coming year as well.

The World Series of Poker seems to be immune from the economic issues that affect the WPT, and thus will likely not see a drop in the summer of 2009. Since the UIGEA is not predicted to be overturned in the coming months, simply due to the complexities of U.S. politics, online poker sites throughout the world will still be limited as to the number of players they will be able to send to the WSOP. However, the positive numbers in 2008 indicate that the WSOP will not be particularly hurt by that factor in 2009. If anything, the overall attendance will increase, if only by a wee bit.

What may see the biggest boom in the U.S. in 2009 are the smaller casino tournaments. The tight pockets of many Americans may prevent them from entering the large buy-in tournaments, but that doesn’t translate into a lack of interest in the tournament scene. Players continue to crave the action, and smaller buy-in tournaments ($1,000 or less) satisfy that yearning and allow players to build their bankrolls through a more reasonable investment. Ladies-only tournaments, despite the surrounding controversy, should continue to thrive as well.

Poker rooms around the United States that host tournaments tend to have a solid base of players who frequent their tables, and those that don’t still tend to draw regulars to their rooms. Casinos who shied away from poker rooms only a few years ago have reestablished them for players who enjoy casual poker games away from home. Most casinos now boast of poker rooms, whether they spread $2-$4 limit Hold’em or $1-$2 no-limit Hold’em or bigger and broader games at the request of their customers. More Omaha and mixed game tables can be seen at even the smallest poker rooms in casinos around the country. Cash games will see the same trend in 2009. The high-stakes games, as already noted by pros who play in the Big Game like Brunson and Negreanu, have all but dried up. There are fewer players willing to risk hundreds of thousands of dollars, especially if those people have seen investments dwindle due to the stock market near-crash. Many high-stakes players are staying away from high-stakes games altogether, while others are simply stepping down in limits to better control bankrolls.

Smaller cash games will continue to do well in casinos around the country, though a small dip would not be a shock, as more recreational players decide to put those bankrolls toward bills instead of the luck of the draw. The economy, and how quickly it rebounds from the current crisis, will be the main factor in determining the growth, or lack thereof, on the cash game scene.

Online Poker

There has been little to get in the way of the growth of online poker through the past few years. Not only are people from all walks of life continuing to experiment with the idea of playing poker for money from the comfort of one’s home, but more and more players are studying the game to such a degree that it is possible to make a living from it. Some countries, like Italy, have determined that it is a great revenue generator and thus legalized online poker, bringing more people than ever to the virtual tables.

Of course, that is not exactly the case in the U.S., as it seems to be the one major market that struggles with the idea of online poker. The Unlawful Internet Gambling Enforcement Act of 2006 scared many online poker sites away from U.S. customers, but most U.S. customers have since simply migrated to sites that still accept their business, like PokerStars, Full Tilt Poker, Bodog, and Doyles Room. Most poker players realize that, with the exception of a handful of individual states, poker is not illegal to play; it is the funding of real money accounts that the U.S. government has regulated against. But with a plethora of offshore banks willing to cater to those customers, they will continue to play.

The murkiness of the issue of online poker in the United States is something that will not go away soon, and there will likely be no change in the laws for the better part of 2009. But that doesn’t mean there aren’t efforts underway to reverse the UIGEA and exempt poker from that already-ambiguous and difficult-to-enforce law. It will only be tougher because the Bush administration finalized the UIGEA regulations in November of 2008, which will require U.S. financial institutions to comply with the law by December of 2009.

Until online poker is exempted from the UIGEA, and better yet, is officially legalized and regulated by the U.S. government, online poker sites will experience only somewhat limited growth in the coming year. But at the moment that legislation is passed, and likely supported by a poker-playing President Obama, expect instant growth in the online poker market unlike any the industry has seen to date. On the whole, poker will not see a significant downturn in its popularity on any level. While the U.S. remains a predictor of some aspects of the industry due to its economic crisis and difficulties with online poker laws, many other countries have embraced the game and the benefits that come with doing so. And the bottom line is that people love poker. Whether they play it at their kitchen tables or at the World Series of Poker, people are not generally dissuaded from playing the game because government officials make decisions about the morality of the game.

Poker players are a hardy bunch, and the basis of the industry that has been built over the past decade is strong. The game and its players will experience some growth in 2009 because, well, the odds are in its favor.