A PokerNewsReport.com article has pointed out how regulation is killing the online poker industry all over the world.
Traffic is steadily declining at most regulated sites because players are forced to get into a waiting list before they can play. While Sit N Go tournaments begin only after a long wait, tournaments are cancelled because of lack of players. To make matters worse, online poker rooms have begun reducing their player bonuses and loyalty rewards.
European countries such as Spain, Italy, and France regulated online poker long before US lawmakers began considering it. These countries not only refused to share liquidity with other countries, but also imposed heavy taxes on online poker companies operating within their borders and on poker players who won large pots. Poker companies were forced to reduce player bonuses, loyalty rewards, and other benefits and to increase rake to meet various expenses such as fines imposed on them and licensing fees.
Discontented European poker pros travelled abroad to continue playing professional poker. Their migration further reduced the player pool in their home country, making it more difficult for online poker rooms to survive.
Europe legalized and regulated online poker for the sole purposes of increasing tax revenue. Governments of various European countries felt that they could solve their economic problems by taxing gamblers and gambling companies. But they ended up killing the goose that laid the golden eggs. Over the last six months, traffic at various Italian, French, and Spanish online poker rooms has been declining steadily.
A recent survey shows that 40 percent of the Spanish poker players who used to play at regulated Spanish online poker rooms now prefer playing at unregulated offshore poker sites, further reducing player pools at regulated sites and tax revenues. High tax rates have forced operators such as the OnGame Network, BetFred, Poker770, Paf.com, and others to leave the Spanish market.
The online poker story in the US is a bit different. Initially, the newly regulated poker markets of Delaware, New Jersey, and Nevada appeared to become very successful. But players are slowly losing interest because of increasing disconnection and geo-location issues. Just as in Europe, players in the US have to wait incredibly long just to take part in a SnG tournament or a cash poker game.
As a result, traffic to regulated online poker rooms has declined with more and more players flocking to unregulated sites such as Americas Cardroom and Bovada.