The two online gambling companies are merging in what the officials are regarding as a move that will bring them back at the top of the food chain. With the competition being increasingly tough in this industry and with declining revenues, it comes as no surprise that this merger is mutually beneficial.
Bwin’s CEO Jim Ryan made the announcement in a conference call that was received surprisingly well by investors. By taking advantage of the Bwin’s liquidity and the huge Party Poker Network, the two companies expect to overthrow iPoker Network as market leader. There will be shortcomings associated to this merger and it is predicted that around 10% of current Bwin players will be lost. In the greater scheme of things this loss is not significant and it will be easily offset by the influx of new players.
PartyPoker already chose to shut down high stakes tables earlier this year and it makes perfect sense for Bwin to walk in their footsteps. The company will gradually eliminate these high stakes tables were the least experienced players had no chance, even though this means that some poker sharks will depart. Overall the loses are minimal because the rake is capped at a certain level and neither Bwin nor Party Poker were making a lot of money at high stakes tables.
Ryan also promised that following the merger some significant changes will be made to turn the interface into one that is more user friendly. Promotional concepts and navigation tools will be altered to revolutionize an industry that remained largely unchanged over the last couple of years. With Poker Stars entering the European market in an aggressive manner and other companies expanding as well, Bwin and Party Poker need to extract the most from this move to stay ahead of the curve.