How to start up your own online poker room

[dunnrovers]

I have a few questions regarding online poker, hope some of you can help me. I must admit I'm kind of novice when it comes to poker, but I've already learned a lot from looking at the 2 + 2 forum.

I've got a big paper where I'm going to work out a business plan for a new company, and I've decided on an online poker room. Do any of you know

/images/graemlins/diamond.gif where to look for total number of players, number of online poker rooms and similar statistics?

/images/graemlins/diamond.gif would it be profitable to have a programmer design your own poker software or should you simply buy existing software?

I hope someone can answer to help me get started!

[RedManPlus]

PokerPulse tracks all the poker sites.

Click For PokerPulse (http://www.pokerpulse.com/)

Why???
Do you have a lot of money to invest?

Because you seem to lack...
Everything else required...
To launch a new poker site.

Ideally...
You should be an experienced player...
Very computer sophisticated...
An experienced businessman...
And willing to relocate offshore.

rm+

/images/graemlins/cool.gif /images/graemlins/cool.gif /images/graemlins/cool.gif

[billyb]

dude,

her said it was for a Paper. cut the kid some slack.

peace
wwonka

[dunnrovers]

[ QUOTE ]

PokerPulse tracks all the poker sites.

Click For PokerPulse (http://www.pokerpulse.com/)

Why???
Do you have a lot of money to invest?


[/ QUOTE ]

Thanks for the link! No I'm not gonna invest anything. It's for a big paper i got, that's due in 6 weeks. I'm just trying to do some research now...

Have you got a good answer for the question about software as well?

[other1]

The software question is one of the more important questions your business plan will need to address. I don't think it's as simple as option A or B is better.

Look at some of the big networks. Crypto is probably a good start because they are a public company so financial #s will be available. http://www.cryptologic.com/ How much revenue do they generate through licensing? How much do they pay to maintain an engineering staff?

Also, a quick suggestion before potentially wasting a lot of time. Make sure your teacher is ok with a business plan for a business that is essentially illegal in this country.

[dunnrovers]

[ QUOTE ]
Look at some of the big networks. Crypto is probably a good start because they are a public company so financial #s will be available. http://www.cryptologic.com/ How much revenue do they generate through licensing? How much do they pay to maintain an engineering staff?

[/ QUOTE ]

I know the question of software is not that simple. But it is really hard to get any info from Cryptologic and other firms on their prices. Making it quite hard to compare them... Do you have any experience in programming? I've tried asking a few computer experts on how long it would take to develop your own poker software, but their answers vary a lot...

And btw. i'm not from the states, so the legality is no problem. My plan was to place the company in Malta where some of the other poker rooms are situated.

[eastbay]

[ QUOTE ]
I've tried asking a few computer experts on how long it would take to develop your own poker software, but their answers vary a lot...


[/ QUOTE ]

My guess would be something like 6-8 man-years if your people were really good.

eastbay

[Hood]

There's a distinction between 'software' and 'network', although the two go generally hand-in-hand with poker. However when making a decision I think it's important to seperate the two.

Joining a 'network' - such as the cryptologic, ipoker, pokerroom, prima, or becoming a poker skin - you lease the software from them (at a guess I'd say $10-30k a month). You get the rake (or a % of the rake) from the players you specifically bring to the network. The advantage is that there's already an established base of players. The companies main role would simply be promoting the site. You may also have to deal with customer support, banking etc, depending on the deal with the network.

If you're not going down this route, then you have to decide what software to use. You can either develop your own (such as recent arrivals pokermountain and gamesgrid). I agree with eastbay as a rough schedule for development time - the cost is way in to hundreds of thousands.

Alternatively, you could purchase the software but not run in the network. The one that springs to mind is Ladbrokes - this uses the prima software, but isn't part of the network - they have their own base of players. I imagine the software is on a similar lease, or perhaps available for purchase.

I can't see it being too hard to get some of details from the network - buy yourself some poker domain name (I suggest www.holdemgreatpokermountaintopfun.com (http://www.holdemgreatpokermountaintopfun.com)) and pose as a prospective client. Draw up an RFI, send it off to all the networks and software developers. The costs of starting a pokerroom based off a network isn't too expensive that an enterprising individual couldn't request this type of information ligitimately. You'd need this kind of information before approaching possible investors.

If you do get anywhere, I'd be very interested in your paper!

(footnote: I have no inside knowledge of the poker business, all just educated guesses).

[Twitch1977]

I think this is a cool idea for a paper. Like someone said if you're looking for financial information an excellent resource is Cryptologic. Since they are a public company they must file reports with the SEC that detail pretty much all of their financial dealings.

Included within should be the costs of running their sites, how much the spend on R&D, what their revenues are, probably right down to how much they pay for software development specifically.

The easiest way to access these reports is straight from the SEC website (just search for company name Cryptologic):

http://www.sec.gov/edgar/searchedgar/webusers.htm

The form you want is probably the most recent 40-F form, which I think is the foreign equivalent of an american companies 10-K.

These SEC forms mentioned above have an incredible amount of information regarding everything a company does. Here is a direct link to the form I think you'll want.

http://www.sec.gov/Archives/edgar/data/1094036/000090956705000655/0000909567-05-000655-index.htm

Unfortunately it's a little tedius to find the information you need in these, but if you have the patience it should be there. (Oh and also note when they talk money in these reports it's usually represented in thousands so if you see a cost of $1,306 in the report it usually means $1,306,000)

Good luck with the paper,
T

[stigmata]

How about aiming the site at an unexploited market (i.e. far east) and being the first poker site in these languages. You might also include traditional gambling games from these nations. Just a thought..... Might be nice to have some sort of novel angle to the paper.

[Gator]

Here are some resources that might get you started in the right direction:
www.dobrosoft.com (http://www.dobrosoft.com)
http://www.offshoregamingsource.com/Directory/XcDirViewInCat.asp?ID=28
http://www.boostlab.com/products_backend.html#
http://www.bossmedia.com/
http://www.grandvirtual.com/technology/
http://www.playtech.com/
http://www.wagerworks.com/

Good luck with your paper. Let me know how you make out.

[tlnini]

Because Cryptologic is a foreign company, there's isn't much research on it. But send me a PM, and I will forward you some wallstreet sell-side reports.