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Advertising Internet Gambling

Online casinos and cardrooms continue to mushroom in popularity. An article, Online Gambling Sites Expect Big Payoffs, published in USA Today in February, 2005, says:

“Online gambling has hit the jackpot. After years of escalating growth, it's poised for its biggest year….More than 2,000 gambling Web sites this year will rake in nearly $10 billion in revenue, most from U.S. consumers. That's up 40% from 2004. In 1996, when lawmakers first sought to curb Internet gambling, 30 sites collected $30 million, says researcher Christiansen Capital Advisors. That makes gambling one of the Internet's largest moneymakers, even though it is illegal.

“Poker revenue is expected to double to more than $2 billion and attract 1 million players a month. Americans play at 266 Web sites, up from 53 in June 2003, says gaming site CasinoCity.com.”

An even more enthusiastic prediction is reported by eGaming Review: "Online poker could grow by 149% this year [2005] and take in US$3.5bn in revenues, according to investment bank Dresdner Kleinwort Wasserstein. DKW said the online poker sector could be worth as much as US$8.1bn by 2008 if growth in Europe and Asia match forecasts. The bank, which is advising Party Gaming on its listing plans, said the US market is expected to fall from an 80% market share in 2004 to a 68% market share in 2008.

An important factor in this growth has been the advertising of online gambling sites in U.S. media such as television, radio, print publications and other online sources including search engines, e-zines and affiliates many of which are compensated with reference to the amount of business they pass through to the gambling website.
This article considers recent developments in advertising of online gambling activities.
Online Poker Rooms on World Poker Tour Cable TV Shows.
The World Poker Tour’s first season began in March 2003. An early show covered an UltimateBet.com live tournament event held in the Caribbean. Within a few days UltimateBet.com experienced a dramatic increase in downloads of the software necessary to play poker on its online site. That software allows a user to participate in both the play-money and real-money poker games offered to anyone who wishes to play.

A few weeks later a World Poker Tour episode was shown that involved PartyPoker.com’s first live poker tournament, which was held on board a cruise ship. Massive downloads of the PartyPoker.com software followed. Again, this software allowed anyone wishing to play poker online to do so. PartyPoker.com offers users both play-money and real-money poker games and tournaments.
Discovery Channel, owner of the Travel Channel, on which the World Poker Tour episodes are shown, then began accepting advertisements from PartyPoker.com, and subsequently from some of its competitors, including UltimateBet.com, PokerStars.com and Paradise Poker. These ads produced wildly successful results. PartyPoker, the first to advertise quickly became the number one online poker room, and has held that position to date. PartyPoker, together with its affiliates, now accounts for about 60% of the online poker action.

Advertisements on Internet Search Engines.
Online search engines and portals such as Google, Yahoo, Overture Services, Ask Jeeves, AltaVista and others offered substantial advertising opportunities for online sportsbooks and Internet casinos and cardrooms. The growth of the online gambling businesses was helped considerably by being able to advertise in these widely accessed engines and portals.
Advertising and Affiliate Programs.
Many online gambling businesses have elected to advertise in U.S. print media as well as with online websites. Payment for this advertising takes one of three basic forms: 1) a cash fee up front for the advertisement; 2) payment of a per-head bounty for each new “real-money” subscriber referred to the gambling site as a result of the particular advertisement; or 3) a share of revenue the gambling business earns from players who are referred to the gambling business as a result of the particular advertisement.

Some of the online gambling businesses also offer another kind of affiliate program. In this form a website appears to be offering its own gambling business, but in reality is a part of the ongoing operation being conducted by the parent casino or cardroom. A prime example of this was Empire Poker, which actually was a shell that wraped around PartyPoker.com. Empire received a share of the profit earned by PartyPoker.com as a result of play in the “Empire Poker cardroom.” PartyPoker has now disbanded this type of affiliate relationship.

These forms of advertising and business promotion have also been instrumental in the logarithmic growth of online gambling over the past ten years.

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