Forum Files: PokerStars, Again

Alex Weldon : December 14th, 2015

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We’re now about three weeks away from the PokerStars VIP Rewards changes going into effect, sparking either the end of online poker as we know it or a return to the glory days of soft tables and people having fun, depending on who you ask. In all likelihood, the actual effects of the changes will be far less dramatic than people in either camp expect, and most players will adjust to the new normal and go about their poker lives.

In the meantime, each piece of corporate communications coming out of PokerStars provokes a new wave of outrage on the forums and professional players’ Twitter accounts. As a result, most other topics of conversation have been drowned out by discussion of, arguments over and complaining about the changes. The three principal threads on the subject (the two below, plus the strike thread, which is still going albeit no longer very relevant) are closing in a combined 4000 posts due to continual bumping as events have unfolded. Meanwhile, new tangent threads have sprung up with such regularity that Two Plus Two moderators are now locking the smaller ones to prevent PokerStars discussion from overrunning the first page of News, Views and Gossip entirely.

Where it all began…
Thread: PokerStars VIP club changes plan removal of SNE

Details about PokerStars’s planned changes were accidentally posted to the site’s Russian website towards the end of October and subsequently discovered and posted to the forums, igniting a panic. Its hand forced, PokerStars officially announced the changes the following day, at which point this thread was created to contain the firestorm. With 1722 posts as of this writing, you’re not going to want to read the whole thing at this point, but the latest development is a post this morning from PokerStars representative Matthew Hilger, who is in charge of the VIP program.

Although the changes were never going to be well-received by professional players, the situation was made much worse because of how and when the information came out. November 1 is, in many people’s opinion, far too late in the year to have announced such dramatic cuts to the Supernova and Supernova Elite players and because the information was initially leaked by accident, some believe that the decision was actually made much earlier, and that PokerStars was originally planning on withholding the information even longer.

Hilger’s post details the official timeline of the changes according to PokerStars, including the claim that the final decision to make the changes only came at the beginning of October, and the details were only worked out by the middle of the month, shortly before they were accidentally posted to the Russian website. If true, this version of things is less bad than what many people imagine, but of course the players who are being asked to accept this timeline have already decided they can no longer trust PokerStars, so it’s unlikely to calm many people down.

Negreanu puts his foot in it
Thread: Daniel Negreanu Delivers a Response to Stars VIP Changes – See post 477

As I opined over the weekend, Daniel Negreanu is caught in a position resembling that of a child of divorcing parents, finding his loyalties split between professional players and PokerStars, both of which he’d like to continue to have a relationship with. This thread – the third-largest the controversy has produced – began shortly after the changes were first announced, when Negreanu went on Joe Ingram’s podcast to say that he agrees with the changes themselves, but not on the timing of the announcement or on the fact that players who achieved Supernova Elite status in 2015 will be deprived of their full benefits in 2016.

Negreanu generated some goodwill – or at least ambivalence – with the forums community by being somewhat critical of PokerStars at that juncture. However, the thread has been rekindled as of last week, because of a post Negreanu made on his Full Contact Poker blog, in which he apologizes for failing to rectify the situation. Although his tone is apologetic, he casts the problem as one big mistake, a “communications blunder,” and this is not to the satisfaction of those who see it as a matter of deliberate deceit and outright theft. The blog post is linked to at post #477 and the tone of the thread takes a dramatic turn at that point, from confusion and speculation to a Negreanu hate-fest which has since boiled on for another 20 or so pages.

We spit on your freerolls!
Thread: PokerStars – Four $1 Million Freerolls Planned for 2016 – More on VIP Changes

This thread is a direct response to Eric Hollreiser’s blog post last week, in which he announced, among other things, that 2016 will see four freerolls open to all players, each with a $1 million prize pool. Of course, this is identical to what Supernovas and Supernova Elites were already getting on top of their other rewards, but will now be of much diminished value for any given user due to the gigantic fields they will surely attract now that a premium VIP status is no longer a criterion for entry. Understandably, the reaction in the thread to this concession has been less than enthusiastic.

A question of sustainability
Thread: The Current “Unsustainable” Poker Environment is a Myth

PokerStars has long been claiming that the often-unpopular changes it has made since being purchased by Amaya – including the latest changes to the VIP program – are necessary because the existing model has been proved unsustainable by internal analysis of user data. This is a view that’s widely accepted by many people in the media and on the industry side of things, but rejected by a majority of the players themselves.

The trouble is that PokerStars doesn’t want to make all its usage data public, for the obvious reason that they’re under no obligation to and doing so can only help their competitors – and, depending on how it looks, potentially hurt Amaya’s share prices. But the problem is that, without seeing the data or knowing exactly what analysis PokerStars has done on it, those negatively impacted by the changes have no reason to give PokerStars’s version of things any more credence than their own guesses. Thus, we get a thread started by user “MeleaB,” who believes that the decline in traffic might be temporary and could be reversed in time by finding new markets and capitalizing on the overall growth of online gambling.

Rooting for Amaya losses
Thread: Amaya recognized a $32 million loss on Ongame sale (According to their 2014 Financial Reports)

Now that there is officially no hope of the changes being cancelled or reduced in severity, affected players are looking for something else to hope for, namely the failure of the company which has incurred their wrath. To that end, forums user “Gramps” has dug up a fact from Amaya’s 2014 financial reports, that Amaya purchased Ongame for somewhere between €15 and €25 million and then sold it two years later, reporting a net loss of $32.2 million. According to Gramps, this is evidence of Amaya’s inability to operate a poker site competently. Others in the thread assume that the discrepancy in the numbers is evidence of dodgy accounting of some sort, to avoid taxes or pump-and-dump its stock or some such.

Of course, none of the detractors seem particularly well-versed in finance and investment, overlooking some basic facts (some pointed out by others in the thread), such as that Euros are not dollars (and their relative value has changed dramatically since 2012), that Ongame probably operated at a loss during the two years Amaya owned it, and that $32.2 million represents less than 1% of Amaya’s overall value since the PokerStars acquisition, so these losses are not likely very significant to its overall stock prices, which have seen leaps and dips on the order of 30% within the past year.

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