Zynga and Bwin Agree to “Party” Together

Social gaming giant Zynga announced recently that they will be partnering with the Bwin.Party group to bring real money games to their customers in the UK market.

Their plan is to launch during the first quarter of 2013. Zynga Poker will use a Party Poker skin, and will share the same player pool with Party Poker and other poker skins including Empire Poker, WPT Poker, Gamebookers Poker and DanskeSpil. Zynga will operate under the same Gibraltar license.

In addition to poker, Zynga will bring a full library of casino games. Players can choose from 180 different games including craps, roulette and blackjack. A FarmVille themed slots game will be available, too.

Talks about Zynga moving to the real money poker sites market has been in circulation for nearly a year now. Their agreement coincides with the decrease in value in their stocks over the course of 2012. In quarter 2 alone, stocks dropped 40%.

Facebook is to blame for this — at least according to Zynga. Zynga has stated that Facebook has tweaked their algorithm to the point that Zynga’s games don’t show up in the search results as often as they used to. So making the transition to real money poker and casino games and having the opportunity to tap into the Bwin.Party pool of players can give them the boost in revenue needed to satisfy their investors.

Making the transition to a real money poker site gives Zynga the opportunity to diversify and spread their risk, too. Currently 90% of their revenue comes from Facebook. That’s too much, especially considering that they have no control over the algorithm changes or the new (speculated) products that may come from the social media giant in the near future, such as the Facebook phone.

The partnership can benefit Bwin.Party, too. Over the last year they have seen a 33% decrease in their cash game traffic. Zynga Poker hosts 120,000 ring game players daily across their social media channels, site and mobile devices. And they host over 30 million users monthly to all of their products. Just a fraction of that traffic can help boost traffic numbers to Bwin.Party, and possibly even bring them back to the #3 spot overall. They were at #3 recently, behind rival iPoker, but were pushed to the #4 spot after Full Tilt Poker re-launched on November 6th.

Will the Zynga / Bwin.Party Partnership Boost Profits for Both Parties?

That’s not an easy question to answer.

Just launching a real money platform does nothing. Since they share a player pool it merely spreads the traffic (and profits) around. So they don’t make any extra money, but spend money on employees and overhead.

To be successful, Zynga is going to have to put a lot of effort into convincing their current user base to switch to real money games. At the moment less than 10% of their social media customers spend money on chips, barns and other virtual items for their games. 1% of their user base accounts for 50% of their revenue.

That’s overall.

Zynga Poker sees 1.4 million users from the UK per month, on average. Using the numbers from above, that’s only 140,000 real money users per month. Considering you can buy Zynga chips for $5 (starting at), how many players do you think will stick to real money poker when they realize that same $5 won’t take them nearly as far, or give them the same status?

How many of them even want to “gamble” in the first place?

What do you think?

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