888 and Treasure Island recommended for Nevada licence
GCB unanimously recommends both companies, which have agreed a partnership to offer online poker in the state
Online gaming operator 888 has moved a step closer to the US market after receiving a recommendation for an interactive poker licence by the Nevada Gaming Control Board.
In yesterday’s hearing the company was unanimously approved for a service provider licence while one of its proposed partners, the Las Vegas casino Treasure Island, was recommended for an operator licence.
Earlier this week eGaming Review revealed the two companies had agreed a partnership which would see 888’s technology powering an 888Poker site launched using Treasure Island’s licence.
Under Nevada law only existing casino licensees can operate an online poker site, and according to one source, the deal will see 888 not only provide the software but also fund the licence fees and marketing costs, while paying Treasure Island 5% of future online poker revenues.
The source, who asked not to be named, argued that the agreement was “far from what the industry had in mind a few years ago” by effectively allowing a foreign operator free reign by renting a land-based operator’s licence.
“888’s ambition to position itself as a B2C brand in US, successfully in Nevada yesterday, should however void a lot of current discussions with others US land-based casinos who were seeing 888 as a B2B partner,” he said. “Either it will become federally licensed or have a licence in one state which will allow you to co-operate in others, so 888 is not a long-term partner. Their goal is to have a 888.com everywhere in US, and the land-based casino will get a ridiculous percentage of the revenues, building no value for the future.”
“Knowing that 888 is now going push their own brand in Nevada, it will probably force Caesars to move faster,” the source added. “888, which used to be a B2B partner, is now becoming the biggest competitor of Caesars and Ultimate Poker. The strengths of 888 in SEO, online marketing skills and with an already educated and paid team in Israel, will most likely make the most profitable online poker in Nevada.
“Unlike Ultimate Gaming (Fertitta Interactive) and Caesars, they don’t have to set-up dedicated operations for it, so most of the revenues of 888 in Nevada will be reinvest in marketing, and then, they will definitively be more visible than the others. This is very good for 888 – they are the big winner of the regulation in Nevada.”
888 chief executive Brian Mattingley and long-serving CFO Aviad Kobrine were present at yesterday’s meeting and were quizzed for two hours on topics including problem gambling and player identiy verification.
The Gibraltar-licensed company has an existing agreement with Caesars Interactive Entertainment (CIE) to supply software for a World Series of Poker-branded website in Nevada. The Caesars Entertainment subsidiary has already received its operator licence and has been awaiting 888’s before being able to go live; CIE chief exec Mitch Garber has said the operator is “ready to switch the site on”.
Nick Batram, an analyst with Peel Hunt, said the recommendation from the Nevada Gaming Control Board was “a major step forward for 888″. “Final approval on 21 March would put the group in a strong position to be a major B2B supplier to the regulated US online gaming market. In this, the group would be ahead of its international peers,” he said in a note.
Two further companies were recommended for service provider licences yesterday. Player Verify and XYVerify, both specialists in player identification and geolocation, are now expected to receive final approval from the Nevada Gaming Commission later this month.