|
FACTS: 888 has announced that it has agreed to extend its existing UK B2B software agreement with Caesars Interactive Entertainment to include a regulated US poker market, either at a federal or state level. The partnership will become operational once 888 is successfully approved for a Nevada Service Provider Licence and regulation of online poker occurs in the US.
|
|
ANALYSIS: 888 already has an existing B2B agreement in place with Caesars, to which it supplies Caesars' UK facing sites with its B2B services; in one way, therefore, today's announcement comes as no surprise. The agreement, while for poker only, will see 888 supply Caesars-branded websites with a US facing poker platform once poker is regulated at either the federal or state level. As would be the norm for B2B deals, there is nothing to suggest that this deal is exclusive, which will therefore allow 888 the opportunity to offer its services to other potential partners once markets open.
|
|
What did surprise about this announcement is that 888 does not have an anti-prosecution agreement with the US DoJ (unlike those agreed by PartyGaming and Sportingbet) relating to activities in the US pre-UIGEA. While 888 has stated that it has already submitted an application for a Service Provider Licence with the Nevada Gaming Control Board (NGCB), and is one of the first to do so, there is a risk that at some stage this falls foul of the federal authorities in the US. Having said that, the NGCB is one of the most stringent and well regarded gambling regulators in the world and, perhaps more importantly, has already given approval for the partnership between 888 and Caesars in the UK.
|
|
DAVY VIEW: This is an interesting announcement and a good win for 888. Caesars is the second-largest casino operator in Nevada with well regarded brands across the US, the most obvious being Caesars Palace. The announcement has stressed that 888 and Caesars will be ready to launch real money poker in the US immediately once regulated; this will be important as a big land grab will occur in the initial stages following regulation (as we have seen in other regulating markets). While this is a B2B deal and does not include a JV (such as announced by bwin.party, MGM and Boyd), the upside to 888 is smaller. However, this approach will save 888 a significant amount in marketing spend; Caesars will drive players to the network from which 888 and any further potential partners can benefit.
|
Back
|