Last week Caesars Entertainment announced that it has entered into a French partnership with Barriere. A couple of days later the company received a license to operate an online card room in France. Not long ago a deal was sealed in Italy with Microgame who operates the People’s Network poker network.
Caesars Entertainment enters these regulated markets with some very attractive assets in the form of the WSOP and WSOP Europe events. Question is: How do they leverage and maximize the value of these assets in these regulated markets?
Before I move on, I’d like to mention [intlink id=”177″ type=”post”]this entry that discusses the issues Caesars (previously Harrah’s) already face in terms of monetizing the WSOP[/intlink] and retaining its status as a yearly must attend festival for all us poker fanboys. And girls.
Now, the catch 22 scenario is pretty straightforward. On the one hand they need to make sure neither WSOP event suddenly loses so much of its open-arms tradition that media coverage and popularity drops. Media outlets are tied in with affiliates and players, affiliates and players are tied in with sites and sites not tied in with the WSOP will go do something else.
On the other hand, restricting access and offering a unique online tournament product is the easiest way to leverage these assets. Short-term anyway.
Looking at the two events separately, the Las Vegas based WSOP has never felt exclusive. Whatever barriers that may have been placed to prohibit companies that want to run qualifiers to the event from doing so have been easily dismantled. And on occasion, Caesar’s have gladly supplied the tools.
As the entry linked above explains, there have been other issues with the WSOP if you are an online card room wanting to do business with it, and for certain European players the tax situation has become a real turn-off, but on the whole, WSOP Las Vegas has retained its status as the primary pilgrimage of poker. And rightly so.
For the European WSOP, the situation has to a certain degree been the opposite. It’s always been exclusive through the presenting sponsor deal that Betfair signed in 2007. The deal, at least the parts I’ve reviewed (and remember), were intended to give Betfair a clear upper hand in terms of leveraging the event through online qualifiers and such. Amongst other thingas, they were given an exclusive right to host satellites.
I remember noting already back then that if that was the intention, then the approach wasn’t quite right. But it’s probably unfair to blame (then) Harrah’s for that. The online world was new to them. And to be honest I obviously don’t know what changes Betfair may have demanded. Maybe it was all good. On paper.
In reality it wasn’t though.
When push came to shove and the event didn’t really do its US counterpart justice, Harrah’s got squeezed between pleasing Betfair, who didn’t have the capacity to take the event where it needed to go on their own, and attracting the rest of the market.
My personal opinion is that it was all a mess and the third year of the deal, there was little interest from non-committed partners left to attract. And I don’t think Betfair were all that pleased either. I wouldn’t have been.
THE NEW DEALS
The deal in France, as far as I’ve been able to gather, contains the following:
1. WSOP Europe will switch venue from London to Cannes and be housed in the Casino Barriere de Cannes Croisette and the Hotel Majestic Barriere which according to iGaming Business means it will have twice the capacity that London offered.
2. Caesar’s will be involved in the Barriere Poker Tour somehow and the tour will be aimed at feeding the WSOP Europe event which will conclude the tour. My interpretation here may be wrong.
3. WSOP Europe will have Barrierepoker.fr as its presenting sponsor.
4. Caesar’s themselves will launch and offer real money games via the already licensed wsop.fr site.
The Italian deal is a bit different and basically means that Caesars have granted Micrograme the right to market WSOP events through its People’s Network. Also, it seems the two will partner up to operate Italian flavored WSOP brick and mortar eventsin Italy.
From the press release:
“As part of this agreement, Microgame becomes the exclusive satellite provider in Italy of WSOP land-based events. Microgame will also act as the exclusive pre-registration booking office for Italian players for the WSOP Main Event held in Las Vegas.”
A HAPPY THREESOME OR ANOTHER DIVORCE AROUND THE CORNER?
Have they done the right thing?
Since that could be a really long discussion, I’m going to leave out the part about whether or not they’ve chosen the right partners in each country. I believe there may be one or two opinions out there on that. :-)
Feel free to share.
First off, I’d like to congratulate the people at Caesars for learning their lesson and approaching the monetization of these assets in a much more creative manner. The way they are going about it instinctively feels far more relevant to what they are about.
A great way to partially defuse the exclusivity discussion is to sign with a network. And for a network signing up assets like that makes sense. A well-run network can work that into something that pays off in the end not just through association, reputation and press coverage.
In France, I love that they seem intent on also monetizing their assets on the ground. They know the offline game. And so does Barriere. They are outmatched in the online realm, but if they can play the cards right in the French Cercles, they can build a solid business from there and thus not be under so much pressure to get the online side of things right from the start.
I for one never liked the London setup so I can’t imagine Cannes being worse. And by that I mean that I have high hopes for it. Haven’t visited Cannes since suffering from the stomach flu of the century so I hold a tiny grudge.
Any pitfalls then?
Well, nothing in the French deal, at least as far as I’ve been able to gather, spells out whether or not other French licensees may join in on the qualification spree. And that decision is of course again a Catch 22 situation – although an easier one to handle. They’d be making that decision on the back of a much sounder business plan. That is, of course, if anyone is even interested.
I’m itching to be part of those discussions to be honest.
For Italy, the entire quote smells of foul. Being the exclusive pre-registration booking office sounds like something both Betfair and Everest were issued through their deals as well.
Worth zero dollars in both cases. And any form of online exclusivity contract concerning online satellites to an event were direct buy-ins are allowed, is yet to prove more water tight than a fake Omega watch with cracked glass dropped into the Mariana Trench.
All-in all some interesting deals that I will be following with profound interest – from behind my desk. The chance of me ever playing in any of them puts the watch scenario to shame…. :-(