PartyPoker to relaunch poker platform and form its own network (August 29, 2008)
Discussions with DOJ continue, millions spent on legal fees
PartyGaming has invested heavily in its long-running talks with the US Department of Justice
and still expects positive results, according to interim results released today.
In the report on the first half of 2008, the company reported a loss from discontinued
operations of $4 million. It said the loss
"primarily reflected legal fees associated with the Group's ongoing discussions with the Attorney's
Office for the Southern District of New York."
Also noted in the report and the accompanying analyst conference call:
● While the company has diversified, poker still accounts for 60% of revenue.
● PartyPoker is set for a major relaunch of its poker software. The relaunch, which is imminent, will
include "a range of new features and tools, many of which are currently unique." The new software
is described as making PartyPoker "more relevant" to its European customer base, opening the door to
the possibility of pound- and euro-denominated tables. A major marketing
campaign will accompany the relaunch.
● PartyPoker's growth is being "held back" by competition from sites that continue to operate in the US.
Citing PokerScout statistics, the company noted that its online poker market share had dropped from 12%
to 8% in the last year. "While PartyGaming believes that the DoJ is investigating companies that accept
online gaming customers in the US, there can be no guarantee that any action will be taken against
such companies."
● PartyPoker also faces competitive pressure from the larger poker networks. To combat this effect,
the company will form its own network. The initiative comes at the hands of new CEO Jim Ryan, a veteran
of the CryptoLogic, Excapsa and Boss Media networks. No details on licensees or a name for the new
Party network have been announced.
The plan constitutes a reversal of direction for PartyPoker, which
forcibly separated from its existing network in 2005.
Read the full report here: PartyGaming interim results (PDF)