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Texas Hold ‘Em Poker on Facebook Contributing to $30 Billion Annual Pot

08/10/12 8:30 AM

Out of the many millions of Facebook pages and applications, Facebook is the most “liked”, receiving that distinction a whopping 70 million times. What application beats out all other non-Facebook entities with the most likes on that social networking giant? Zynga’s Texas Hold ‘Em Poker game on Facebook has more than 64 million “likes” and has become a cash cow for Zynga. And as popular as it is, that particular application is but a ripple on the surface of the massive financial ocean that is online gaming revenue.

The recent Global Gaming Expo this year saw industry analysts crunch the numbers and estimate that an incredible $30 billion was generated in total online gambling revenues last year. That includes more than 15 million online “pay for play” poker players and 40 million regular “play for free” participants playing on sites like Facebook with applications like Zynga Texas Hold ‘Em. But the difference with games like online poker as opposed to popular online games like StarCraft II is that online poker playing for money is illegal in 48 states. Getting paid a cash prize for winning an e-gaming competition of World of Warcraft or some other e-game is legal because those types of strategy based games are considered “games of skill”. Playhem is one such company which has created a social wagering and competitive gaming website for these types of games.

Online poker is still viewed by the majority of American judicial entities as a game of luck, but things may be turning around. The Department of Justice late last year reversed their opposition to Internet poker, and has allowed instead for each individual state in the US to dictate their online poker future. Delaware and Nevada have already legalized online poker, and California, New Jersey and Iowa are pushing to authorize Internet play for casino games operated by hardware and software companies inside their physical brick-and-mortar casinos.

Anyone who has played poker on a regular basis, either online or off, would strongly argue that it is definitely a game which requires skill rather than luck, and at some levels this opinion is agreed upon by important rulings. In New Jersey recently a federal judge ruled that a local man operating Texas Hold ‘Em games out of a warehouse was not in violation of that state’s statutes against offering games of luck for money. And others, such as Playhem co-founder Keith Swan, actually “see online poker as much closer to a real-time strategy video game than a physical game of table poker.”

That may just be the virtual designation which will drive a nationwide move to legalizing online poker in the United States. And certainly forward thinking companies like Zynga are already paving the way for a smooth move into the pay for play online poker arena, building massive player pools at the free level. If Senate Majority Leader Harry Reid (D-Nev.) gets his way, online poker will be legalized this year nationwide in Congress’s lame-duck session, and individual states would have missed out on their chance at outlining their own online poker destiny. At this point only two things are certain. Online gaming is a multibillion dollar revenue generator, and with two of the 50 United States already on board, legalized online poker has a strong if early foothold in the US.

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