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Gigi Levy, CEO of 888 Holdings stated on eGaming Review (EGR) on Tuesday that it was “highly likely” that 888 would favor merger discussions with other online poker sites within the next six months. Levy also told EGR that their marketing tactics would remain the same regardless of other companies’ mergers.
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“I think that the first thing to remember is that the consolidated Party-Bwin, when the transaction is completed, will represent less than 10% of the market,” Levy told the online gaming news site. “We are not talking about someone controlling 50% of the market, giving us no chance to compete. We are talking about an entity which is significantly larger than us, but still is less than 10% of a very fragmented market. In that regard, I don’t see us changing anything in our strategy because of that” said Levy.
Gigi Levy
Shortly after the first merger has been completed [4], it is definitely time for the relatively smaller poker sites to start working out tactics for a possibly legal US online poker market [5]. According to Joe Saumarez Smith, Chief Executive at Sports Gaming, mergers will be inevitable once online poker becomes legit in the United States.
“The key thing is that Bwin/Party is going to be on top of any shopping list of any government inviting private operators for a chat about online gambling in their country. By putting two of the largest operators together into one entity, they become a company that is automatically on every shortlist for a gaming operator contract. They also become the obvious number one acquisition target for Harrahs and its Las Vegas rivals should online gambling become legal in the United States.”
Joe Saumarez Smith
Although the PartyGaming/Bwin merger still does not make the poker giant’s traffic overtake Full Tilt Poker and PokerStars, the merged company has strengthened its third position and seems to be a very tempting offer for any contract indeed.
888’s own poker room, Pacific Poker currently takes place 15 on the ranking site PokerScout.com (the order is determined by the traffic of the given site). This means that if 888 really wants to play a major role on the United States online poker market, a merger seems necessary.
Levy informed EGR that he did not yet know who they would target for a merger, but Ladbrokes’ name has truly come up as a possibility.
“For 888, Sportingbet, Unibet and countless other mid-sized operators, this is going to be a wake-up call to their boardrooms. Gaming companies are often complemented for their ability to be nimble and fast moving in comparison with their rather slothful rivals in the 'real' world of gaming. But that simply won't be good enough. I suspect the theme for the next couple of years will be one that worried gaming executives in the past – size definitely matters,” says Joe Saumarez Smith, and I think we should believe him.