Online Darwinism

I risked angering the poker gods by withdrawing a chunk from PokerStars this weekend.  The $150 deposit of five weeks ago had ballooned into $630 and it was time to pull back some of the funds for potential whoring opportunities and fantasy football/baseball league fees.  So that orphan $150 that was in Neteller has likely become a fully-accessorized Ipod Mini for my son, a reward for straight A’s this quarter.  And I still have over $250 in money playing at PokerStars and Pacific.  

I haven’t even logged on Party and/or Empire for months so I was unaware of the hubbub regarding the jettisoning of the affiliates and the installation of prop bets.  Two quick thoughts here, neither of which probably matter to most of you.  Party is following a fairly standardized marketing strategy.  Specifically, use partnerships to help grow a customer base, then cut them off when you feel like your product is self-sustainable.  Happens every day.

My second thought is more business oriented.  What kind of idiot lawyers and/or marketing groups do these skins have?  It seems awfully abrupt to just suddenly get cut out of all these affiliate deals without any way to protect/retain their customers.  If they HAD known about the pending separation, every single depositor for these skins should have received an email with a list of their NEW promotions or deposit boni.  This way, they could attempt to lock in some quick incremental funds AND preclude any jumps over to Party.  If they DIDN’T know about Party’s plans, then shame on them.  Each one of these rinky-dink sites will probably dissolve within a few months due to low volume.

Thus begins the inevitable shakeout of the online poker industry.  Strange that I haven’t heard anyone else mention this, but the breakup of Ma Party signifies that online poker has hit the saturation point and sites can’t rely on organic growth to sustain profitability.  Now they must feed off the carcasses of the dead and dying to fuel their hunger.  Thus, it is now more profitable for Party to forego the minimal licensing/sharing fees and try to completely eliminate competitors.  

It’s fairly likely that we’ll see significant casualties as poker sites without casino gaming dry up, and leave us the mega-poker sites like Party, Full Tilt, and PokerStars.  I’m kind of a poker Darwinist, so this doesn’t bother me, but poker whores might lament the decline of deposit boni and the MTT overlays that second and third tier sites have been offering.  You may start seeing some niche marketing (“We have the most Follow-the-Queen MTT in the world!” or “We have the most Spit-in-the-Ocean tables!”) as smaller (ie. less than 5000 players per night) fight for share of mind.  The battle lines are being drawn, and the bodies are already piling up.