World Series brand key to Internet poker
Not every casino company has been seduced by the prospect of big profits that may be possible should Internet poker be approved for U.S. companies and their domestic customers.
Harrah’s Entertainment (HET) has put its considerable influence behind the plans for legalization by lawmakers that await further action in Congress. Planting the Harrah’s flag anywhere near this issue is sufficient to guarantee plenty of attention since the company owns the best-known brand in the poker business – the World Series of Poker, which is being played out at the Rio.
But companies such as Wynn Resorts (WYNN), Penn National (PENN) and Pinnacle Entertainment (PNK) have made it clear Internet poker does not mesh with their existing business models.
Steve Wynn probably said it nicely when he declared his lack of interest in catering to "people in their underwear hunched over their computers in dark rooms" miles from Las Vegas or wherever his casinos might be located.
A Pinnacle spokesperson seemed to agree, although there was no effort to imitate Wynn’s imagery. "We prefer to market our casinos as the sites of social activities."
Visitors to a Pinnacle casino may involve themselves in gambling or whatever activities are offered in the casino of their choice, but with a reference to Wynn’s imagery a Pinnacle official said they much prefer to have customers in their buildings.
Penn National CEO Peter Carlino has been much less visible on the issue, but sources familiar with his thinking say he has no interest in doing anything to help Internet poker toward approval in the U.S. A healthy Penn bottom line requires the presence of bodies in front of the thousands of slot machines it operates in a growing number of venues.
There’s no reason to believe MGM MIRAGE's (MGM) interest in legal Internet gaming is any less than it was several years ago when it briefly operated an offshore Internet site on the Isle of Man, but MGM remains a company that has a big commitment to other priorities for the time being. Get CityCenter open and the massive debt reduced and there will be time to focus on everything else.
If Internet poker is approved and MGM rises above its current problems, it might even take another shot at buying the World Series, something it tried to do several years ago. Given the chance, MGM tends to think one way: big.
An MGM official who agreed to discuss the subject if he could do so without being identified suggested that just about anything is possible and nothing should be taken for granted, including Internet poker’s eventual approval.
"You can get hurt," he said, "trying to second guess the likely direction of the political process and if Steve (Wynn) decides to pick up the phone to argue a particular point of view he can probably reach just about anyone."
But the beat goes on and Harrah’s is standing behind its big bet.
A Harrah’s insider, who took a long look at the subject with the promise of anonymity, conceded that not all casino companies are in agreement. But he did not try to hide the touch of cynicism in his voice, suggesting that the thinking of Harrah’s competitors and opponents of the Internet poker issue may be influenced by a single fact: "Harrah’s owns the best known brand in the world of poker and whatever we might do with it looks like a slam dunk, as success stories go."
Which underscores the importance of the time spent during the last several years building awareness of the World Series brand around the world. Two World Series of Poker Europe tournaments in London the last two years have helped get the message into new markets. And there will be more.
Hanging around the World Series at the Rio the last couple of weeks feels like time spent in a little United Nations kind of environment.
There will be players from well over a hundred countries at the Rio by the time this year’s WSOP reaches the final table about the middle of July.
The Harrah’s insider maintains that the company’s enthusiasm for Internet poker has not been affected by the recent effort to freeze the payment of millions of dollars due Internet gamblers.
"The fact is we’re paying careful attention to our lawyers."
Meaning: Nothing will be done before the time is right. But the feeling at Harrah’s is that opportunity is headed in its direction.
Question? Comment? E-mail me at: Phil Hevener