Social Gaming Company Zynga Seeks Opportunities in Regulated US Market
Mark Pincus, the chief executive officer of social gaming company Zynga, is most likely to have found a way to save his company.
On Tuesday, Station Casinos launched the US’s first licensed online poker room in Nevada and gave its residents a taste of real money online poker in a safe, secure, and regulated environment. Zynga might be the next company to launch a real money online poker product, with other companies such as online payment processors following close behind.
Speaking about Zynga’s future in the online gambling sector, Lewis Ward, the IDC analyst, said: “It’s a significant opportunity for Zynga.”
Online poker in the US could soon become a billion-dollar industry as Nevada has already launched its first online poker room and New Jersey is finalizing its regulations for online gambling businesses. States that have already legalized intrastate online poker have provided for the formation of interstate gambling compacts to create better liquidity. The nation is stepping into an entirely new chapter ever since the disappointing events of Black Friday.
If sports betting is legalized, it could help cash-hungry states generate plenty of tax revenue. Experts have already estimated that legalized online sports betting could be a $400 billion industry, which will greatly benefit online payment processors such as PayPal.
Joseph Kelly, who teaches business law in Buffalo’s SUNY College, said: “It’s estimated that $380 billion is wagered on sports in the US and only about $3 billion of it is legal because only in Nevada can you wager on sports betting.”
Zynga is badly in need of some luck at present. Last week, the social gaming company reported that its revenue had fallen by 18 percent. Besides, it had lost 13 percent of its monthly active users. This had turned out to be a double tragedy for Zynga.
The company’s most popular online poker game is Texas Hold’em Poker, which is available for fun only, but gets around 30.2 million active players every month. Most of Zynga’s mobile casino games, such as slots, card games, and dice games, are very popular. Zynga has applied for an online poker license in Nevada, but will have to wait for 18 more months to be granted one.
According to a forecast by H2 Gambling Capital, the US online gambling market could be worth $7.4 billion by 2017, considering the fact that several US states have passed online gambling laws.
PayPal, an online payment processing company that processes gambling funds in gambling friendly countries, is also waiting to enter the US market. On the downside, the US lacks a federal-level online gambling law, which can bring about uniformity in the industry. Anuj Nayar, a spokesperson for PayPal, said: “If that were to change, there is no reason why we wouldn’t do it (in the USA).”
Zynga has also launched a real money casino product in the UK, as part of its partnership deal with Bwin.party Digital Entertainment.
H2 Gambling Capital states that, in 2012, the global regulated real-money online gambling industry became worth $50 billion.
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