An Elaborate History of Bwin.Party
Bwin Interactive Entertainment and PartyGaming were both very popular online gambling sites throughout the 2000s, but when they decided to merge in 2011, their popularity escalated and their fan base grew even more rapidly.
They now call themselves Bwin.Party Digital Entertainment. Bwin and PartyGaming still have their own separate websites as they specialize in different aspects of gambling, but through this merger they get to share resources and expand their player pool and corresponding networks. Below we have provided a thorough history of Bwin and PartyGaming, while also giving you details on their merger.
How Bwin Started
Bwin's history dates back to the late 1990s when the company called themselves, BetandWin. Although there were twelve men that were responsible for the start up of this company, there's one man in particular that was important to Bwin's initial success and that was, Manfred Bodner. After receiving a Bachelor of Arts in Business and International Studies from Webster University, Bodner used his business skills to make Bwin a reality. He especially focused on their marketing techniques and was responsible for making sure they reached their sales goals.
The team of twelve worked hard and within a year they were able to launch their first website, which focused mostly on sports betting. The website flourished as people from all over the world were curious to learn more about this new company. Bwin continued to grow and by the turn of the century, they launched an initial public offering on the Vienna Stock Exchange.
Expanding even further, less than a year later, they opened a bookmaking firm called, Simon Bold, in Gibraltar. Due to lower tax rates, the entire company moved to Gibraltar and many other online gambling companies soon followed in their footsteps.
Bwin was able to put aside the money they saved from the lower tax rate and used it to branch out. In 2002, Bwin introduced the first online live sports betting platform, which gave customers the opportunity to place bets on sporting events as they were taking place, an innovative idea that changed the course of online gambling history forever.
Bwin recognized their player's passion for poker and started focusing on developing new and improved software to enhance the poker games they already offered on their site. In 2005, they purchased Ongame, a popular poker site that was on the verge of going out of business.
Changing Their Identity
It wasn't until 2006 that Bwin officially decided to change their name from BetandWin to the Bwin name we know today. One of the co-founders of the company, Manfred Bodner, released this statement to the press after the company's transformation. "In the course of a two-year process, we succeeded in creating a communication basis by way of the transformation from BetandWin into the brand platform Bwin, which covers a broad product portfolio."
Their new identity was formed around the same time that the United States government released the Unlawful Internet Gambling Enforcement Act, which forced Bwin to close their doors to all US customers. This was going to lead to a huge loss in their yearly profits if they didn't act fast, so they started looking for areas where the popularity of online gambling was on the up rise.
By 2009, Bwin found just what they were looking for; they purchased Italy's best online gambling site, Gioco Digitale, for around $56 million in cash and for 2.3 million shares of their company. Bwin also took initiative and started focusing on the prevention of gambling addiction by financially supporting Harvard Medical School's gambling addiction research facilities and by becoming an active member of the European Gaming and Betting Association.
Bwin also started sponsoring various teams at this time, including the Real Madrid and the AC Milan soccer teams. They continued to expand into other countries and by 2010 they became the first site to be offered a French gaming license. Thanks to all of these advancements, Bwin surpassed the 20 million player mark, clearly proving that they were a company worth partnering up with.
The Founders of PartyGaming
Unlike in Bwin's history, there are two main founders of PartyGaming that we believe are fundamental to learn more about in order to truly understand the site's history: Ruth Parasol and Anurag Dikshit. Let's start with Parasol; she received her Bachelor's Degree in Business from the University of San Francisco in 1988 and her Law Degree from Western State University of Law in 1992.
Parasol always wanted to open up her own business and now she had the education to back up her desires. She first dabbled in the online pornography field but certain controversies forced her to move on from it. Having an eye for up and coming industries, she decided to head over to the online gambling industry. After studying online gambling regulations and learning how the payment process works, she started developing her first website, Starluck Casino Online, which wasn't as successful as she hoped it would be. Parasol knew she needed help and that's why she partnered up with Anurag Dikshit.
Dikshit had quite an impressive resume, as he had graduated from the Indian Institute of Technology in 1994 with a Bachelor's Degree in Computer Programming and on top of that he developed software for both Websci and AT&T. Thanks to his background in software development and design, he was just what Parasol needed to advance in the online gambling world.
The Expansion of PartyGaming
Parasol, Dikshit, and their newly founded team spend months developing new games for the site that would later be known as PartyPoker.com. They focused on poker, as they saw the potential to make a significant amount of money in this particular form of online gambling.
Before the launch of their site, they had their games tested by Michael Shackleford, a highly respected casino statistician. Unfortunately, the results from the test were far from what they wanted to hear; Shackleford had deemed their games unfair, claiming that they favored the house over the players.
After making the necessary adjustments to overcome this issue, PartyPoker was officially launched in 2001. Its popularity grew quickly and before long it became one of the world's largest online poker sites. It wasn't long before they were expanding into other forms of gambling, using the same software for each new site they launched.
They became the site with the largest pool of players, which in essence attracted even more players to their site. What was most appealing was the fact that players didn't have to wait as long for a game to start, as there were plenty of players online even during the lower traffic hours of the day.
In less than four years, PartyGaming PLC was making over $500 million in annual profits. In 2005, PartyGaming was floated on the London Stock Exchange and was valued at over $8 billion. The company continued to grow by nearly 50% and it looked as if they had a very promising future. This success story would soon come to the end though, as new laws in the United States were soon to be passed that would have a lasting impact on the online gambling industry.
How the UIGEA Affected PartyGaming
In October of 2006, the Unlawful Internet Gambling Enforcement Act (UIGEA) was passed, which made it illegal for gambling sites to process any transactions from US customers. Even though almost 75% of the company's revenue came from US players alone, PartyGaming was forced to close their doors to all players from the United States.
This development is a significant setback for our company, our shareholders, our players, and our industry," said Mitch Garber, CEO of PartyGaming PLC. This law was clearly a devastating blow to the company and in order to compensate for their huge financial losses, they had to expand.
2009, What a Year!
PartyGaming spent the next two and a half years coming up with ideas that would help attract new players and increase their yearly profits. In April 2009, Party Gaming agreed to pay $105 million to the Department of Justice for trying to target US citizens prior to the UIGEA in hopes that the DOJ would eventually allow them to enter the US market in the distant future.
In November, 2009, Party Gaming purchased the rights to the World Poker Tour for $12.3 million. The World Poker Tour is an array of tournaments that are played in various poker formats around the world. Party Poker was hoping that through purchasing World Poker Tour they would slowly be able to re-enter the US poker market, the publicity the tournaments get on television helps attract new players to their site.
In 2009, Party Poker was awarded the title of eGaming Review's Poker Operator of the Year at the Gaming Awards. According to EGR magazine, despite the major setback that occurred in 2006, PartyPoker managed to maintain its position as the biggest non-US stand alone poker site in online gaming."
Early on in 2010, PartyGaming started focusing less of their attention on poker and more of their attention on casino games. PartyCasino was designed to offer a real brick and mortar Casino experience in an online virtual world.
The site has just about everything you could think of, from slot games to cash games and you even have the option to have a real dealer video stream live if that's what you prefer. PartyCasino was very successful right from the get-go but PartyGaming was still looking to further expand, and that's when rumors of a merger started becoming more relevant.
The Bwin.party Merger
Bwin and PartyGaming were both doing well up to the time they started thinking about a merger but they were hoping a merger would help them get back to where they were prior to the release of the UIGEA. After mulling the idea over for about a year, they released a statement confirming that they were planning to merge. By March of 2011, Bwin.party Digital Entertainment was the latest addition to the online gambling market.
Most of the senior management from both companies were able to keep their jobs despite the changes that occurred from this merger. Less jobs were lost than expected because although Bwin.Party is considered one large corporation, both companies still operate independently. A huge benefit from this merger was that the two companies were able to expand their player pool, which ultimately increased their yearly profit. Plus, Bwin.party was able to collaborate on certain projects that they may not have been able to do before the merger.
A Short Partnership with Zynga
In the fall of 2012 Bwin.Party announced that they had formed a partnership with Zynga Inc., a leading provider of gaming services that was ready to head over to the gambling market. Under this new partnership, it would be Bwin.party's responsibility to provide the operating platform and software needed in order to launch and maintain Zynga's new poker and casino gaming options. Bwin.Party in return would receive a small percentage of Zynga's profits for the duration of their partnership.
Due to disagreements between the CEOs of both Zynga and Bwin.Party, in February of 2015, both companies sent out a letter to their shareholders announcing the end of their partnership. The sites that Bwin.Party helped create, ZyngaPlusCasino and ZyngaPlusPoker, were shut down just a few weeks later.
According to Casino News Daily, before the partnership was officially terminated, "In November 2014 Bwin.Party said it was considering a number of business propositions by interested parties." We are intrigued to find out what partnerships may be in store for Bwin.Party in the near future.
Bwin.Party Reaches Out to Nearby Communities
When Bwin.Party was formed, they agreed that giving back to the less fortunate was a passion of theirs. The company allows their staff to spend four to eight hours a year on various charities or environmental projects on the company's time.
The Bwin.Party team has raised money for cancer research, built several school buildings in India, and continues to plant trees in areas that have been affected by natural disasters. They have also donated money to a plethora of different organization including the British Heart Foundation, Children's Cancer Research, and the Disaster Relief Fund of Red Cross.
Ever since the merger, Bwin.Party has been actively seeking out new opportunities to help those in need and they have already donated billions of dollars to the foundations mentioned above and to other causes as well.