Study: UK online poker market to shrink this year 16/11/2009

Jon Parker

THE UK ONLINE POKER MARKET stopped growing in 2008 and will shrink this year, new research has concluded.

After growth of 72% between 2004 and 2007, the British online poker market stagnated in 2008 at gross gaming yield of £265m, the study by market research agency Mintel has revealed, and will shrink by 7% to just £247m this year.

The research attributed online poker’s tail-off in Britain to the economy, with almost a third of UK players saying they play less often or for smaller stakes due to the recession. Average spend per year among British online players has fallen by almost 20% in the past 2 years, down from £345 in 2007 to £281 in 2009.

Mintel senior leisure analyst Matt King said: "Poker revenues have clearly peaked. The recession is the most obvious culprit, with around a third of poker players now playing less often or for lower stakes because of the economic downturn.”

However the analyst added that other factors could also be to blame, including rakeback promotions, which have proved controversial when used by affiliate sites and were the subject of eGaming Review’s August cover feature.  

King added: “There may be other inherent problems that the industry has to address. Rakeback promotions, for one thing, are minimising margins and this shows the emphasis is on customer numbers, not the profit generated per customer. Lack of time is another factor impacting on play, possibly suggesting work pressures in the current recession are having a toll on players' free time."

A drop-off in poker revenue has already been witnessed among operators such as 888, where third quarter poker revenue fell 28% year-on -year and Cryptologic, which migrated its poker operation and customers to the Boss poker network last year.

Despite declining revenues, the industry does boast a loyal UK customer base, however, with around a third of online players play once a week or more.

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Posted: 16/11/2009