Online Gaming Affected By Global Financial Crisis

Published on: November 27, 2008 

Online casinos and poker rooms that were once considered 'recession proof' are starting to go the same route as their live siblings in Las Vegas, Atlantic City, and Macao.  They are starting to show wear from the global financial crisis and fewer people are logging on to place their favorite games, opting to save their money instead of spend it gambling.  Discretionary funds are not as available as they used to be and fewer people are flocking to the vices they once enjoyed.

Lotteries, casinos, poker rooms, and other gaming devices are experiencing a decline thanks to the receding economy.  People living in an economy that is booming normally would travel to the many live casinos and poker rooms and spend their disposable cash gambling, staying in luxury hotels, and enjoying good food and drink.  However, with the recession looming on the horizon many players have decided to save money and stay home, indulging in their vices by playing online.  Even though people are playing online, the financial global crisis is limiting the amount of money that is actually hitting the rooms themselves.

Sherman Bradley, the Online Casino Advisory’s senior gaming analyst, recently finished a month long study of online casino activity, excluding the poker rooms.  Prior to the near collapse of the world economy most players were depositing anywhere from $100 to $200 every fortnight.  Now since the stock markets of almost every major country nearly crashed, that number has lowered to $25 to $50 during the same time frame.  Stated Bradley, "This tells me a couple of things, that online casinos are not these evil, addiction wielding devices that destroy lives. To me, this is proof that people only spend what they can afford on this form of entertainment and that they can certainly control themselves on the internet. It also tells me that gambling in any form is not recession proof."

It is believed that the passing of the Unlawful Internet Gaming Enforcement Act (UIGEA) has had some effect on gambling, and with the current implementation guidelines getting set to go into effect December 2009 the effect may very well cause the online gaming community to decline even more.  Already companies such as Microgaming have pulled from particular market segments and analysts are counting that towards the decline of gaming.  Bradley, however, disagrees. “The online casinos that remain in the U. S. market are actually seeing major player increases since Microgaming left. However, players are not depositing higher amounts and they are not depositing multiple times, as was the norm before the recession. In addition, Microgaming casinos that still allow their U. S. players who were already patrons with them to play are also seeing the same trend.”  He continued by saying, "Players are still playing but they are not playing or depositing nearly as much as they once were."

Even the live poker world is suffering.  Overall tournament participation has declined as much as 30% and many of the establishments have tried to boost these numbers by lowering the buy-in costs in an effort to attract players.  Players are tightening their belts, but at least they are still playing.

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