Nevada and Delaware Begin Liquidity Sharing Poker Agreement

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Monday, March 30th, 2015 | Written by Stephen Smith

Back in February 2014, Nevada and Delaware announced a landmark “Multi-State Internet Gaming Agreement” (MSIGA) that was to see the two regulated states combine their poker playing pools. The deal was necessary in order to boost the separate state’s small poker playing numbers, and was seen as a vital step towards setting up a viable, attractive online poker industry. Nevertheless, several “technical glitches” conspired to ensure the MSGIA was never implemented, but last week that all changed after the soft phase of their liquidity-sharing deal was eventually announced.

MSIGA A Creation Of 888 Holdings

Players from Nevada and Delaware are now legally playing poker against one another, with the shared network the creation of 888 Holdings, a Gibraltar based company which provides the online software across both states. This includes Nevada’s only viable poker room, WSOP.com, together with Delaware’s three regulated poker rooms of DelawarePark.com, DoverDowns.com, and HarringtonGamingOnline.com, and as an 888 Holdings earnings report mentioned this week:

“.. successful deployment of shared poker network across states of Delaware and Nevada in March 2015 creating significant competitive edge for 888 and its operating partners.”

Interestingly, 888 Holdings was forced to exit the US iPoker market back in 2006 following the passage of the Unlawful Internet Gambling Enforcement (UIGEA), but after partnering with Caesars Interactive Entertainment (CIE) and reentering a newly regulated market in 2013 the operator has since become the USA’s biggest online poker provider, with a presence in all three regulated states, including New Jersey.

Bigger, More Diverse Player Base

The MSIGA is only possible because the different sites are powered by the same 888 software, and in the near future the company is also hoping to further consolidate the industry by launching its own poker network in the Silver State, which will be called the All American Poker Network (AAPN). 888 said it then intends to add its very own branded online poker room to the AAPN, and together with WSOP.com, and a new poker site from Las Vegas casino Treasure Island, will eventually link up with Delaware’s three internet poker rooms.

Furthermore, 888 has already used its iGaming software and services to launch an American Poker Network (AAPN) in New Jersey, and at the beginning of this year New Jersey’s WSOP.com and 888Poker’s AAPN partially combined their poker playing pools to dislodge Party Borgata from its long held position atop the Garden State’s iPoker market. The instant success of the model highlights the importance of shared liquidity in building a larger poker player base, and creating a better, more diverse player experience for players.

Delaware To Be Immediate Beneficiary

Both Delaware and Nevada’s online poker industries have been suffering a contraction in revenues since regulation, and in November 2014 Nevada’s first licensed poker site Ultimate Gaming ceased its business, citing the extremely challenging and cost-prohibitive requirement of having to operate within separate state gaming markets in the US. Nevertheless, Delaware’s online poker market is in a significantly worse condition than that of Nevada, and in January Delaware’s revenues were a mere $27,695, compared to the $88,588 taken in the same month in 2014, and lower by a massive 75% from its height of $106,922 in December 2013.

Therefore, the latest MSIGA launched between Delaware and Nevada is likely to initially benefit Delaware the most, as it gains access to a market with a population at least three times its own size. Furthermore, at this early stage the MSIGA is already having a noticeable effect with PokerScout reporting that the Delaware poker network has more than 350 players at peak time, compared to the six-month average of 10 real-money ring-game players reported prior to the agreement.

MSGIA To Provide Scope For Future Growth

Since New Jersey became the last of three US states to regulate online poker in 2013, their less than stellar revenues have dissuaded other states from following suit and passing regulation of their own. A huge part of the problem has been that unlike other casino games poker needs a large number of players to create an attractive gaming environment, something smaller states like Delaware have been unable to achieve. Other states, however, will now have the incentive of joining the new MSIGA and automatically becoming a part of a larger network of players, and as 888 Holdings CEO Brian Mattingley, explains:

“The launch of the MSPN is a key milestone for 888 and marks a new era for regulated online gaming in the United States. This has all been made possible by 888’s flexible and robust gaming platform, deployed across all three regulated US states, which opens up the possibility for other states in the US to join in the future, should they choose to.”