Last week’s Gambling with an Edge podcast/radio show featured a discussion on the “poker boom”, the “moneymaker effect” and growth of the WSOP. For me at least, the most interesting areas for discussion are the causes and effects of the poker boom. Confusion remains in the poker/gambling community about why the poker boom happened, and what it means for poker and gambling more generally. The poker boom also provides insights into larger trends shaping the business of gambling, so its important that we understand what the poker boom was, and how it impacts poker and gambling.
I believe the poker boom was caused by a groundswell of young men playing online poker. Expanded media coverage, WSOP popularity, and Chris Moneymaker’s win are all reflections of the poker boom, but they didn’t cause the poker boom. The poker boom was caused by the growth of young men playing online poker.
Before discussing the causes and effects of the poker boom, let’s start with some history. The World Series of Poker was started by Binion’s Horseshoe in 1970. But before then, Binion’s had staged a famous poker game between Nick the Greek and Johnny Moss where the two players battled heads-up for very large stakes in front of a casino crowd. The WSOP tournament was an evolution of this promotional match. The WSOP was a marketing program to draw customers into the casino and to promote the Horseshoe casino. The WSOP grew slowly from 1970 until the mid to late 1990’s, when the tournament exploded in entrants and popularity. Please consult the WSOP wikipedia page for an easy to read chart of the main data on entrants and prizes.
As readers will notice by examining the historical entrants and winnings data on the WSOP, by the end of the 1990’s, field size was starting to grow at a faster rate until it breaks out completely in 2004. This breakout in popularity is what is referred to as the “poker boom“. The most significant highlight to this trend was the 2003 tournament won by Chris Moneymaker. The main question then is: what caused the “poker boom”?
When thinking about the poker boom, we should be careful not to confuse causes and effects. For example, did the expanded media coverage cause the poker boom or was an outcome of greater poker popularity? These are chicken and egg questions. Identifying the changes are useful, but even more important is assigning influence.
So what are the main issues?
In 1998 the firm Rounders was released to mixed reviews and moderate success at the box office. The film depicts the underground world of high stakes poker games. For gamblers, and poker players in particular, the movie is a classic. After winning the 2003 WSOP, Chris Moneymaker even refers to the film as an inspiration for his own play. Rounders is often cited as a cause of the poker boom, but the film actually pre-dates the poker boom. The poker boom was caused by the growth of online poker. In the film, the characters are playing live games. Contrast Rounders to the 2013 film Runner Runner, and the differences are plain. In Runner Runner, the main character isn’t playing any live poker games, he is dedicated to online play.
Rounders actually pre-dates the first online poker sites such as Planet Poker or Paradise Poker. They were formed in 1998, the same year rounders was released. The popularity of Rounders actually grows following its box office release with the poker boom and the growth of online poker play. If Rounders was one of the causes of the poker boom, we would expect to see more growth in the WSOP, but in fact, the year after the release of Rounders, the WSOP number of entrants only increases from 350 to 293 (12%) which is in line with the increases in most previous years leading up to that time. So Rounders didn’t cause the poker boom, but its growing popularity is a reflection of the poker boom.
Hole Card Cameras as also often cited as a cause of the poker boom, but hole card cameras were actually patented in the US in 1995, which pre-dates the poker boom. If the idea for hole card cameras was available since 1995, then why did it take broadcasters so long to employ their use in their coverage of the WSOP? Since online play didn’t begin to grow until the late 1990’s, the popularity of poker didn’t justify much investment or expansion of broadcast coverage. The expanded broadcast coverage of the WSOP and other circuits such as the WPT, happened because of the groundswell of popularity of online poker among young men in the early 2000’s. The use of hole card cameras did not cause the poker boom. The use of hole card cameras is a reflection of the greater investment that broadcasters put into poker coverage following the growth of popularity caused by online poker.
The Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) marks the end of the poker boom. With the UIGEA, online poker in the United States was severally crippled. Online play practically disappeared overnight in the United States. Meanwhile, online poker’s international growth continued apace. The break of online poker in the United States is reflected in the entrant stats for the WSOP. The year following the UIGEA, WSOP entries went from an all-time high of 8,773 to 6.358, a decrease of 27%. This is during a time when television coverage continues apace.
What sustains the WSOP? Even after the UIGEA, the WSOP still continues to attract many entrants, far above the trend before online poker. I would be interested to know the international composition of the WSOP field. I expect the international component of the WSOP field to have grown following the UIGEA. The international entrants would still be able to play online poker outside of the United States. 4 of the past 7 winners of the WSOP are from outside the US (if we include Merson as international since he moved to Canada in order to continue playing poker online). The greater international component of the WSOP could be a reflection of the larger trend of Las Vegas tourism (which is growingly international), and also the growth of gambling internationally. The WSOP continues to grow internationally, particularly in Asia, and the EPT and WPT continue growing internationally.
Lot’s more research needs to be done to determine the interaction between land based gambling and online gambling.