Casino Poker Was in Dire Straits Before the Poker Boom Hit

Steve Ruddock : March 8th, 2016
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The poker boom ushered in by Chris Moneymaker’s 2003 World Series of Poker victory radically altered the poker world. But contrary to popular belief, Moneymaker’s victory wasn’t the sole catalyst, it was the final act in a series of events, not least of which was a strong economy. In addition to a lot of disposable income, the poker world was boosted by the proliferation of online poker, the launch of the World Poker Tour and the hole card camera, the movie Rounders gaining cult status, and James McManus’s recounting of his run to the 2000 WSOP Main Event final table in the New York Times bestseller, Positively Fifth Street.

By the tail end of 2003, poker was suddenly cool to college kids thanks to Rounders, as well as middle-aged professionals because of Positively Fifth Street. The mystique of the game was stripped away thanks to the hole card camera and the availability of information on the Internet. Poker was available to anyone, anywhere, anytime thanks to online poker. Because of the strong economy people had money to gamble. And then there was the Moneymaker Effect.

In 2003 the poker boom came to the people, instead of the (willing) people going to the boom.

Numbers don’t lie

With all of these forces occurring in the space of just a few years, the poker boom was a perfect storm of sorts, and it couldn’t have come at a better time. The notion that the poker boom lifted up the poker world isn’t quite correct as it understates where poker was in 2002. The reality is the poker boom may have saved brick & mortar poker as we know it.

Thanks to the poker boom, business in brick & mortar poker rooms was suddenly booming, but what people don’t understand is just how far brick & mortar poker (particularly in Las Vegas) had fallen in the preceding decade, and how close poker was to being snuffed out.

This chart from the UNLV Center for Gaming Research is quite telling, and paints a very grim picture of where poker in Las Vegas was headed had the poker boom not occurred when it did:

Year # of Rooms # of Tables Total Revenue % Change YoY
1992 92 564 74,701,000 -2.57
1993 89 571 70,814,000 -5.20
1994 93 586 71,667,000 1.20
1995 92 574 66,520,000 -7.18
1996 82 539 64,485,000 -3.06
1997 77 490 61,509,000 -4.61
1998 76 526 58,873,000 -4.29
1999 70 546 63,244,000 7.41
2000 68 473 63,064,000 -0.28
2001 65 475 59,673,000 -5.38
2002 57 386 57,791,000 -3.15
2003 58 383 68,276,000 18.15
2004 79 484 98,862,000 44.80
2005 96 701 140,224,000 42.00
2006 106 886 160,929,000 14.77
2007 113 907 167,975,000 4.38
2008 113 913 155,724,000 -7.29
2009 114 905 145,580,000 -6.54
2010 109 920 135,200,000 -7.13
2011 104 872 131,877,000 -2.46
2012 99 809 123,253,000 -6.54
2013 88 774 123,891,000 0.56
2014 79 736 119,904,000 -3.18
2015 76 681 118,023,000 -1.57

According to the UNLV chart, in 2002 and 2003, the number of poker rooms in Nevada was down nearly 40% from a decade earlier. The number of tables was down nearly 33% during that same time period, and total revenue down well over 20%.  And aside from an outlier year in 1999, poker revenue fell every year from 1995 to 2003.

The number of poker rooms fell every year from 1995 to 2002, a clear sign that casino were shuttering poker rooms in favor of other gambling options.

Beyond the numbers, despite the sheer success of the 2003 WSOP, Nolan Dalla has noted that the 2004 WSOP was nearly cancelled (let that sink in for a moment), something that would have likely thrown a bucket of cold water on the poker boom before it even really got started.

Expansion in the 1990’s staved off poker’s demise

It’s unlikely legal poker would ever become extinct across the country, particularly with California card rooms relying on house-banked games, but in the run-up to the poker boom it was expansion efforts in other parts of the country that kept poker’s head above water.

While we don’t have hard numbers from other legal poker locales, in the 1990’s Atlantic City (1993) and Connecticut (1995) added poker rooms, creating an East Coast mini boom of sorts, but the poker rooms, most notably the ones at Trump Taj Mahal and Foxwoods, leveled off fairly quickly, while other rooms struggled to gain much traction as legitimate poker hotspots.

In California, the historic legal card rooms that can be found up and down the coastline started growing in size and stature following the expansion of legal poker rooms in 1986 (when stud and holdem were legalized), and by the early 1990’s poker had undergone a rebirth of sorts in the Golden State. But like on the East Coast, by the time Y2K started rolling around, the industry was stagnant, if not declining.

But these efforts bought poker enough time, and in 2003 everything came together nicely.

Upshot

There is a lot of talk about the death of poker, and how the number of players is on the decline, but if you look at the hard numbers, poker in 2016 is much stronger than pre-poker boom poker in Nevada. There are fewer rooms, but the rooms in existence are far larger (the number of tables in the state is up at least 15% compared to numbers from the 1990’s) and more importantly, revenue is nearly double.

Certainly no one wants to see a decline, but poker in 2016 is far stronger than poker in 2002.

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