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Partypoker move hits Empire stock

Partygaming will no longer let players of websites owned by rivals like Empire Online and Coral Eurobet gamble at the same tables as its Partypoker clients. The online firm has launched a new platform just for its nine million customers, adding features including blackjack and gambling on card colours. And new software will let it separate its players from those entering via "skin sites" such as Empire and Coral. Empire Online shares fell 34% and those in Partygaming 11% by Monday's close.

'Lot of competition'

Partygaming (PartyPoker.com)said the move did not weaken its relationship with its allies.

But Charles Wilson at Bridgewell Securities said: "Statements from Partygaming and Empire Online contain the initial seeds of divorce."

There have been recent concerns about the long-term prospects for online poker, and Empire boss Noam Lanir said on Monday that the market showed little growth over the summer.

The company provides marketing services and helps push traffic to online gambling sites.

"It's not news there's a lot of competition out there," Partygaming's John Shepherd told Reuters.

"But we're still supportive of our 'skins'. We've improved their platform as well as our own."

Mr Wilson, however, in a research note, said that "Partygaming has taken steps to distance itself from its skins".

"We believe the skins customers will be disadvantaged, as they will not have access to Partygaming's player liquidity," he added. "Player liquidity is one of the key customer drivers."

But Empire said it was "too early" to know what the impact may be on its financial performance.

Source: http://news.bbc.co.uk/1/hi/business/4327340.stm

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