According to players who hold affiliate accounts with the site, PokerStars has begun to purge long-standing affiliates from their roles. The question from many is why it is coming at this time.
Many of these affiliates received e-mails yesterday from PokerStars that announced the termination of these agreements, which provided revenues to those affiliates for bringing in players to the #1 site in the online poker industry. Long the base for which some sites earned as much as five figures in revenues per month, one affiliate stated that PokerStars was taking this action because “they felt I had too many old players generating revenue to justify my monthly payment.” The termination notices were in accordance with PokerStars’ terms for affiliate agreements, which state that an affiliate can cancel at any time but that PokerStars has to give a seven-day notice before taking such action.
PokerStars, perhaps sensing an impending firestorm, jumped into the fray quickly to diffuse the situation. Michael Josem of the PokerStars Communication Team was one of the first respondents in a thread on Two Plus Two in which he stated that this was standard procedure for the company. “(We) have agreements with thousands of third-party websites (affiliates) to market our services to new players and encourage them to play at PokerStars,” Josem wrote.
“PokerStars routinely reviews its agreements with these affiliates to ensure that they are productive for the company,” Josem continued. “Earlier this week, PokerStars ended the agreements with a very small number of affiliates who were not recruiting many new players and who were doing little active promotion of our services.”
In essence, what is being said by affiliates is that PokerStars immediately dumped the affiliates in question (within the terms of the contracts) because they weren’t drawing in new action for the site. In many of these cases, the affiliates were still earnings revenues off of players that may have signed up well over a decade ago. As Josem indicated in his statement, PokerStars took this action on a few affiliates who weren’t holding up their end of the contractual agreement.
The affiliates affected have raised the specter that the reason for the purge is simply based in the purchase of PokerStars by Amaya Gaming earlier this year. Amaya Gaming purchased the Rational Group (and its related properties that include PokerStars) for a $4.9 billion price tag. It has long been thought that, due to the purchase, Amaya Gaming might have to make some cuts in the overall product to ensure financial stability.
In a discussion with Poker News Daily on other matters within PokerStars Eric Hollreiser, the Head of Corporate Communications with the Rational Group (the management behind PokerStars), indicated that the Amaya ownership wasn’t the reason for the move. “We are not driven by budget cuts…the decisions made are driven by marketing strategy.”
Naturally, this has raised the ire of many in the affiliate community. One of the mega-affiliates affected by the PokerStars decision took to the pages of 2+2 to state that he was “screwed.” “PokerStars only went after super-affiliates and it was purely a greedy financial decision,” he wrote. “They can try to pretend this is minor news but, when you look at it in terms of the number of player accounts involved, it’s massive.”
The affiliate continues, “People like me recruited tens of thousands of (players) to PokerStars …they basically went after all the biggest affiliates that are no longer “powerful” because our various brands have dwindled over the years. The “new” PokerStars has now made it obvious that they are willing to ignore ethics and screw people simply because it makes financial sense.”
The news of the affiliate cuts comes on the heels of the release of several top pros from the Team PokerStars Pro roster. Latin poker professionals Humberto Brenes (coming off one of the best runs in the history of the World Series of Poker this summer), Angel Guillen and Jose ‘Nacho’ Barbero, the legendary ‘Flying Dutchman’ Marcel Luske, Russian pro Alex Kravchenko and former World Champion Joe Cada were dismissed from the roster earlier this week. No reasons were given for the dismissals and the players involved were gracious in statements regarding their departures.
The moves of late by PokerStars are certain to have an impact on the online poker industry. Whether done as a revamping of their marketing strategy (as PokerStars has stated) or a way of cutting the middleman out of the action (as affiliates believe), it is obvious that the state of online poker – never one to stay settled for long – could be in for another period of upheaval.
