Microgaming Online Casinos: Online casinos shares drop yet again

Microgaming Online Casinos
Online casinos shares drop yet again

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Microgaming Online Casinos - Online casinos shares drop yet again

Those observers of the online casinos industry who warned against getting too overly excited over online casinos initial public offerings, or IPOs, had another chance last week to point and say “I told you so!” as Party Gaming’s decision to “divorce” itself from “skins marketing” companies on the internet adversely affected the price of that company’s shares as well as the shares of other online casinos which have offered shares on the London Stock Exchange. “Skins” are often websites run by companies similar to regular online casinos sites which serve as waypoints or portals to actual online casinos. These skins companies have been a major factor in the success of online marketing for internet casinos.

The news was disconcerting for online casinos and poker sites, and shares in Party Gaming lost 11% of their value, now standing after previous major losses and minor gains at roughly 40% of their value upon the Party Gaming IPO in late June 2005. A more recent comer to the online casinos IPO club, Empire Online, fell 34% on the news as investors questioned what would happen following the Party Gaming announcement of the severing of its skins contracts. Intense competition between online casinos, especially those focused on online poker, could make online gambling companies wary of going public at an especially volatile time for the online gambling industry.

The story of online casinos IPOs since Party Gaming’s initial success in June sparked reports of multiple companies considering IPOs from the same industry has been quite rocky. A little over a month ago, Party Gaming shares lost almost all gains upon the news that online gamblers new to their sites, including Party Poker and Party Bingo, were not wagering as much as regular, established customers at their online gambling websites. No matter how many admonitions that easy money with IPOs wasn’t so easy after all, the online casinos industry plowed forth with other IPOs, and the wisdom of doing so is now being question more than ever by those with that most treasured of virtues, patience.

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