Social media giant Facebook may soon change the face of the online poker industry. In 2011 they changed their advertising policies to allow online gambling companies to advertise in certain jurisdictions where online gaming is regulated. Rumor has it that they are now also seeking to cash in on the market in even more ways, potentially even through real money games offered through apps.
The likely target market for Facebook to offer real money games would be the United Kingdom. The UK already has many successful sportsbook/poker sites, such as Betfair, WilliamHill, Bet365 and Ladbrokes, in part thanks to lenient and unchanging laws regarding online betting. There are, however, many details which will need to be dealt with before any real money games go live. The apps will need to be developed, payment processing methods set up, methods implemented to prevent minors for accessing real money games and revenue sharing plans will have to be agreed upon.
Currently Zynga Poker has been very successful as a play chip-only online poker game, where players can gain credits by referring others to the app, paying for them with real money and, of course, winning them at the tables. Facebook has recently helped this app explode in popularity. Facebook currently takes a 30% cut from the profits of Zynga Poker for credits purchased while playing the game through facebook. While this is a huge revenue stream for both companies, Facebook could stand to be very successful if they were able to offer a real money online poker app to its members.
In order to accomplish this, it is likely that Facebook would try to form an affiliation with an existing poker site. This would expedite the process of getting a real money app up and running. The partnership would likely be similar to the partnership between MGM, Boyd Gaming and Bwin.Party which was finalized late last year. Facebook would be able to provide the advertising and an extremely large player pool, while an online poker site could provide the payment processing, software, an already established player base and active games.
While having a real money poker app available through Facebook might never become a reality due to legal restrictions and other hurdles, they will surely find ways to allow poker affiliates to better promote their services on the site. While it is difficult to find exact numbers, the poker affiliate business is a very lucrative one. The affiliate generally gets a small, but ongoing, cut of the rake generated by all players that they refer to the particular site. With the easy access to potential new clients that Facebook would give to poker affiliates, it would be an obvious avenue to recruit new players. It is likely that we will see active poker affiliates on Facebook before a real money poker app goes live. There are less legal restrictions and other hurdles to surpass for advertising online gambling than there are for offering the actual real money games.