In an e-mail to affiliates on Friday – in some cases other businesses that have been with the site since its inception in 2001 – PokerStars announced major changes to its affiliate program that will have a seismic effect on the online poker industry.
The e-mail, which was posted on several online poker forums by disgruntled affiliates, was direct in its message. “As we look towards the future, PokerStars wants to significantly grow the game of poker by introducing the game to new audiences and continue to acquire recreational players,” the e-mail began. “Consequently, we are announcing plans to rebalance the PokerStars affiliate payment program.”
In the body of the e-mail, PokerStars detailed out the changes that will be made. Most notable of those changes will be that, beginning on June 1, PokerStars will give revenues to affiliates for only the first two years that the referred player is on PokerStars. In the previous affiliate program, which has gone basically unchanged since the start of the international online poker industry, affiliates received rake for life. This meant that a player who may have signed up through an affiliate in the mid-2000s was still generating revenue for that affiliate in 2015. Under the institution of the new affiliate policy, there is no “grandfather clause” that allows for an affiliate’s previous sign-ups to continue to generate revenue for the affiliate beyond the next two years.
The change will not only affect new signings for affiliates but also those that have been with affiliates prior to June 1. “We believe that this change will ensure that the PokerStars’ affiliate program rewards affiliates who join PokerStars in introducing the game to new audiences rather than the current program which disproportionately pays affiliates for rake generated by existing players,” the e-mail read. “”Over the last few years, the global online poker industry has changed significantly and we must change with it.”
PokerStars isn’t giving those affiliates already associated with the company very long to make a decision on whether to accept the new arrangements. “Our existing agreement with you requires us to give 14 days’ notice of changes; in this instance, we will give 30 days’ notice,” the e-mail states (and times in with the June 1 start date). Affiliates have the option of accepting the changes or, if they don’t agree, dropping their PokerStars affiliate coding from their websites.
“PokerStars recognizes that (the change in affiliate relations) will have a significant impact on some affiliates,” the e-mail states. “PokerStars is launching a series of new and exciting efforts to drive significant growth in the poker economy. We believe that these efforts provide a great business opportunity for affiliates who choose to join us in growing the poker world.”
Those efforts reiterate some of the priorities that Amaya Gaming, the ownership behind PokerStars, discussed as their approach in the future for online gaming and poker during their end-of-year financial reports from 2014. “We have three primary plans for growing poker: entering new markets, continued innovative forms of poker that will appear to a wider demographic, and creating consumer demand and excitement through innovative marketing and promotions,” the e-mail continues.
Opinions in the poker community seemed to be evenly divided over the new arrangement being laid down by PokerStars. On one hand, some in the poker world believe that affiliates have been gaming the system for eons, continuing to draw money from PokerStars for not drawing in any new players but those that they acquired over a decade ago. Others, however, point out that the online game has to expand its audience (especially to recreational players) and, by limiting the affiliates to only two years of revenues per player, the affiliates will market more aggressively to bringing new players to PokerStars. Still more bring up the obvious ramification of the change: after two years, PokerStars will hold onto money – potentially millions of dollars per year – that was once paid out in affiliate revenues.
Whether the new affiliate arrangements will bring about the changes in the game that PokerStars (and, by extension, Amaya Gaming) is looking for will only be realized once the changes are instituted June 1. What is a definite is that it marks a new day for affiliates in the online poker world.
