Friday, October 25, 2013

Why the World Poker Tour Failed (Part 2 of 3)

Part 2: WPT helps launch a boom

[Note: This was originally intended to be a two-part story, but there's just too much to do it in two parts. This is part two of what I now expect to be a three-parter.]

[Note 2: If you like the blog, you might also like the new poker-only forum I've started at www.pokersmalltalk.com.]

The World Poker Tour did quite a few things right back in 2002-3, just before and during their broadcast launch. They were also in the right place at the right time. The WPT brought a glitzy program with high production values to market just when two other key factors fell into place: online poker started to gain traction, and a 27-year-old accountant from Tennessee parlayed a $39 $86 online tournament entry into a $2.5 million prize. [note: apparently we got the $39 number wrong for many years while I was at PokerStars. It was so firmly entrenched in the legend that apparently even Chris believed it - the subtitle of his autobiography is "How an amateur poker player turned $40 into $2.5 million at the World Series of Poker." Thanks to Michael Josem for the correction.]

It was in the spring of 2002 that I came into the picture. I had heard about the WPT, but PokerStars had only been live for a few months and had essentially no market presence, so my hopes for getting us involved in the WPT were slim. But two of our biggest competitors, PartyPoker and UltimateBet, were already part of the WPT and it was clear to me that we needed to find a way to get our foot in the door.

I called and emailed Steve Lipscomb, founder and president of the WPT, relentlessly. He finally agreed to meet with me in October of 2002. I drove to the WPT's offices in LA, where Steve showed me the WPT's sizzle reel and some in-process footage, and gave me a rundown of how they intended to market the show, which didn't yet have a broadcast slot.

We went to lunch at a pleasant outdoor cafe nearby, where Steve gave me the bad news: there was no way the WPT would entertain a third online site. In fact, there was no way the WPT could add us to the roster - according to Steve, their contracts with the Bellagio, the Bicycle Casino and the Commerce Casino expressly forbade it. We parted company that afternoon agreeing to "stay in touch," which I knew was the Hollywood kiss-off.

I was dazzled, too much so to drop it. The sizzle reel and the early footage were so far superior to the mediocre TV broadcasts of that time that I decided PokerStars needed to be involved. In fact, I was very concerned that the WPT could launch PartyPoker and UB into the stratosphere, leaving us behind. 

So I set a monthly reminder to call Steve. At the very least, I wanted to make sure he remembered who we were, just in case something changed. And to his credit, he always took my calls. He said no, but was always willing to talk, perhaps knowing as I did that we had a future together.

In early 2003, the WPT broadcasts started to air on the Travel Channel. This seemed like an odd choice to me, but I suspected that network TV wasn't read for an all-poker broadcast yet (that would soon change), so the WPT had likely been left scrambling. They had almost a full season of shows already in the can, some reasonable buzz in the poker community and a cable network that was willing to pay, so getting on the air was a higher priority than waiting for the right opportunity.

UltimateBet's Aruba Classic was the first online poker-sponsored event broadcast, on April 9, 2003. While it gave UB a decent boost, it was far from the bombastic result I had feared. Nonetheless, I still made my monthly calls to Steve. He continued to politely decline.

In late April 2003, PartyPoker did something I hadn't expected - they started buying TV spots on the WPT broadcasts. PartyPoker was a little bigger than PokerStars, having gotten started about a year before we launched. I was very surprised that they were willing to make the investment in TV commercials, especially since we were all operating in a marginal area - it wasn't clear whether the US DOJ would decide to come after any or all of us. But they did, and their numbers immediately reflected it. Paradise Poker, which had always been the 900 pound gorilla of online poker, slipped substantially. PartyPoker went from a distant second, to a close second.

And then, on June 11, 2003, the PartyPoker Million aired, and everything changed. This event had a hard-to-beat marketing triple threat: a branded WPT event, hosted by Mike Sexton (who was also the face and voice of PartyPoker), with PartyPoker commercials. In a matter of weeks, PartyPoker became the #1 online poker site, and within just a few months, Paradise Poker had sunk to #4, this after sporting a 75% market share on January 1. UB was in second place, PokerStars was a close third. But it was crystal clear to everyone, particularly to me, that PokerStars ran the risk of irrelevancy if we didn't do something right away.

Fortunately for PokerStars, our guy had just won the World Series of Poker. In case you missed them, here are a few posts about the 2003 WSOP:

Dancing with Moneymaker
How Olof Thorson broke my heart, and made history
2003 WSOP: The last lap to the final table
Poker's tipping point: the 2003 WSOP final table

These events had taken place just three weeks before the fateful WPT broadcast. So even though PartyPoker had a huge edge, PokerStars had arguably the biggest star in the business, although no one yet knew who he was (the WSOP broadcast that year wouldn't air until mid-July). So I brought Chris Moneymaker to LA in late June, and we shot three truly awful TV commercials. I bought a huge array of 30-second spots on the WPT broadcasts, and also tried to buy some spots on the upcoming ESPN broadcast of the WSOP, but they had no interest at the time (which would change).

The effect of the TV spots was immediate. For reasons none of us could figure out, UltimateBet chose not to air TV spots yet, and it cost them. We shot by them to #2 in a matter of weeks. This effect would be amplified just a few weeks later, when the PokerStars logo was highly visible on the WSOP broadcast (the "Dancing with Moneymaker" blog post includes a memorable, long look at the PokerStars logo on my jacket, which almost brought our site down).

A few weeks after the WSOP broadcast, something else happened that would completely change the landscape. I had started calling Steve Lipscomb in June of 2002, and called him every month thereafter. Not long after the WSOP final table broadcast, Steve called me for the first time. And he said the words I'd been waiting to hear for over a year:

"Just how badly do you want to be on the World Poker Tour?"

Next up: Three mistakes that nearly killed the WPT

2 comments:

  1. Chris Moneymaker won a $86 satellite, not a $39 satellite, to the WSOP.

    ReplyDelete
  2. I challenged Michael on this, and it turns out that all of published history about Moneymaker's win is wrong, and Michael is right! I can't even begin to count the number of interviews I did in which I talked about Chris having won a $39 satellite. Both the PokerStars blog (www.pokerstars.com/team-pokerstars/chris-moneymaker/) and Moneymaker's own blog (www.chrismoneymaker.com/bio/) confirm that it was actually an $86 satellite.

    ReplyDelete