20 Years of Online Poker: Poker’s Sonic Boom (2003-2004)
The History on Online Poker (Series)
Tales of Fast Money, Wicked Beats, and Broken Mice:
Chapter Three — Poker’s Sonic Boom (2003-2004)
The story could be told — and perhaps someday will — on the colossal clusterfuck that was the Binion’s Horseshoe casino and hotel during the final two wild wacko years while I worked there as the often graven and always half-shaven public relations man hired to faithfully apply lipstick on the frowning face of a pig.
An entire chapter could be filled with prose recounting dealings I witnessed during the first online-live casino negotiations, a contentious exchange that would foreshadow a constant tug-of-war between brick and mortar establishments and the new kids on the block loaded with money — the online sites. We were struggling to keep the doors open and the lights on, reading meanwhile about online poker companies doubling in size every few months. The Horseshoe couldn’t pay the employees’ health insurance coverage (yes, the insurance company got stiffed), and here were these arrogant online sites with virtually no overhead or regulators tossing around cash like it was confetti at a Mardi Gras parade. The uneasy truce between brick and mortar hardliners versus the online sites would occasionally be broken by threats and flashpoints. They were bitter rivals when it seems so obvious now — they should have been partners working together. Old school poker rooms and Las Vegas casinos (specifically — their owners) hated the online poker sites.
GutshotPoker.com, was a U.K.-based poker club in London and affiliated website that desperately wanted to partner up with the World Series of Poker, the biggest and most respected brand in the game. So, Gutshot’s executives flew across the Atlantic to try and negotiate a deal. We had glorious dinners with open bottles of Grand Mariner on white tablecloths maestroed by Horseshoe strongman Nick Behnen, peppered with dialogue seemingly taken straight out of The Godfather. Wedged in between Nick, who I directly worked for and reported to….and Barry Martin, one of the execs who owned and ran Gutshot, and Derek Kelly being the other, I felt like a fly on the wall trapped in between Hyman Roth, Michael Corleone, and Tom Hagen.
I introduce this chapter with the Gutshot story because it so painfully reveals the U.S. land-based casino’s (and my own) utter embarrassing and unequivocal cluelessness about online poker and the rapidly changing future of the game.
Even though I’d been an active online player for years, even at this later stage of poker evolution, I was still skeptical.
At one point during our conversation which was increasingly contentious and turned into more of an argument, Barry Martin flat out insisted that if we (the Horseshoe) gave Gutshot our blessing — which meant Gutshot could use our name in promoting satellites for the upcoming World Series of Poker — they would guarantee to ship us 100 entries into the next year’s tournament.
I told Barry he was insane. Straight to his face. I think I even laughed.
Barry couldn’t have handled my insult with more class. Derek, too. They took turns calmly explaining the Horseshoe was sitting on an absolute gold mine, which was its proud tradition and the powerful WSOP brand. They conveyed that by granting (essentially licensing) online poker rooms to run satellites and other tournaments connected to the WSOP, we’d all come out way ahead.
Still, Barry’s boastful calculations seemed optimistic, if not absurd to me. The previous year, the WSOP Main Event Championship drew 631 entrants. Barry’s claim that Gutshot could ship in another 100 players into the pool amounted to what would have added another 1/6th of the field.
Preposterous. No online poker site can deliver that kind of traffic to a live poker tournament. The Gutshot execs were crazy.
Of course, Barry and Derek saw the future. They knew what was to come. And we did not. We were still wearing blinders and the race was already on.
The stunning and spectacular events of the 2003 WSOP would rip that blindfold off in a big way, fortunately leaving no scars.
[There’s far more to the Gutshot negotiations, of course. But some stories will have to wait for another time.]
I didn’t play much online poker during 2003 and 2004. I didn’t have the time. I was too busy.
Funny that poker pro-David Bach (a.k.a. “Gunslinger”) made an interesting comment about yesterday’s chapter. Bach stated he regretted spending so much time playing online poker during its formative days. Instead, Bach asserts, he wished he’d worked on the house side of the equation, or perhaps owned a piece of the action. That might seem like an odd comment from someone who has risen to the top of his profession and earned more than $4 million in poker tournaments, to date.
I say Bach’s comment is odd, because — many of us who worked on the house side of poker for many years and dedicated much of our adult lives to working and running games and tournaments quietly wonder where we might have ended up had we applied our talents and spent all those hours becoming more proficient at poker. Might we have become the Raymer’s and Hachem’s? I suppose the grass is always greener….
As I said, there was no time to play online poker, anyway. My “come and go as you please” and “gamble and drink on the job all you want” dream gig somehow metastasized into a 70-hour-a-week job with no bonus paid for overtime, and a notepad of headaches.
One afternoon (my hours were typically noon ’til midnight), I went into the Horseshoe and saw Warren Schaeffer, who ran both the poker room and the sportsbook, but was really a close confidant of the Family. He told me about a meeting later that day with a couple of executives from PartyPoker.com. Like the earlier pitch from Gutshot, Party also saw the enormous potential of partnering with the WSOP for promotional purposes.
Four of us met, including Warren, myself, and two executives from PartyPoker, including Vikrant Bhargava (I can’t recall the name of the other person). CORRECTION: A previous version of this text incorrectly identified the second executive as Anurag Dikshit, who was later charged by the U.S. Government for violating the 1961 Wire Act, resulting in the payment of a whopping $300 million fine. Thanks to former Party exec Michael O’Malley for identifying this error.
PartyPoker.com had gone bonkers during the span I was putting in crazy hours at the Horseshoe. The site no one had ever heard of with a kiddie-sounding name and seemingly level of seriousness that came with popping a bag of balloons flourished into the General Motors, the Apple, and the Chase Bank of the global poker scene.
Thanks to its affiliation with the weekly-televised World Poker Tour, incessant and clever advertising, and hyper-aggressive marketing savvy in numerous countries all over the world, Party became a giant. It turned its owner, Ruth Parasol, into one of the world’s richest women.
Party was eager to have it all and own everything. Not content with displacing Paradise at some point during 2003, Party not only wanted to be the “go-to” site for the millions who were tuning in to watch the WPT on television. Party also sought an alliance with the Horseshoe, the WSOP, and by association — ESPN.
What they were really going after was something later to be called a “strategic partnership,” which is just an MBA’s fancy way of saying — “I’ll scratch your back if you scratch mine.” Years later, “strategic partnerships” would become standard business practice between major poker competitors when the online companies crafted deals with land-based casinos all over the world. But long before there was cooperation, there was suspicion and war.
The meeting went well, incredibly well as things turned out. Party’s execs must have thought they’d succeeded, by plucking the final prized jewel in the poker power crown. Warren and I expected to return to the Horseshoe, explain a possible new deal with Party that could have brought in some cash, and receive hearty congratulations from the Family.
Instead, we were told –no. All deals were frozen. No more negotiations would take place. We were not to have any more meetings with anyone.
Talks were underway in another part of Las Vegas. On another subject.
Discussions to sell the Horseshoe were underway.
Much has been written about the 2003 WSOP and I’ve contributed to some of that famous legacy. That series was surely the turning point. It was a demarcation. It made careers. It changed lives. There was an era pre-2003 WSOP, and the era post-2003 WSOP. For the modern poker era, it might as well be B.C. and A.D.
Shortly after Chris Moneymaker won, I made an off-hand comment with absolutely no forethought to a reporter who happened to be working for the Associated Press. The AP was the gold standard of print journalism. Being “picked up by the AP” meant your name would appear in hundreds of newspapers.
I labeled Moneymaker’s shocking victory “poker’s sonic boom.”
That line was plastered everywhere.
The description isn’t hyperbole. If poker before Moneymaker had been a propeller plane, his David slaying Goliath victory shown on ESPN that summer during a dead TV time because there was a Major League Baseball strike was essentially breaking the sound barrier with a rocket.
Traffic at online poker sites, particularly PokerStars.com, which had jettisoned a somewhat reluctant Nashville-based accountant to fly to Las Vegas and play in the WSOP, exploded as reports began to air and stories were printed. Party was still king, but Stars began making a major move and would soon become the second-largest online poker site, surpassing Paradise. Stars’ niche was multi-table tournaments, which increasingly became an attraction for new poker converts caught up in the excitement of seeing poker on TV for the first time and wanting in on the action. Moneymaker’s victory and the successive fallout also set off the second wave of new online poker start-ups, some of which were tragically flawed and stood no chance of succeeding. Others withstood growing pains and carved out their own niches in the perpetually bustling new online poker market.
In the coming months, casinos that had previously considered poker the gambling industry’s step-child, a common mindset which had all but made poker a dead game in Las Vegas by closing down rooms, began re-opening and marketing poker to traffic on The Strip. B.C. (make that “B.M. — before Moneymaker”) there were only a handful of busy rooms in the city. A.D. (make that “A.M. — after Moneymaker”) poker room opened up at Bally’s, Flamingo, MGM, Las Vegas Hilton, Golden Nugget, Union Plaza, Hard Rock, Tuscany, and several smaller properties.
Online poker wasn’t cannibalizing the poker market. It was creating it.
Online poker planted millions of seeds all over the world. During the next few years, those seeds would become a jungle of an estimated 15-20 million active online players.
Evidence that poker was in the midst of a tornado, aimlessly headed to destinations unknown, became abundantly clear when a bizarre thing happened at a poker tournament held a few months later in Atlantic City.
Matt Savage, the WSOP’s tournament director joined Barry Shulman, Card Player’s CEO who were consultants on what was to be the first (and only) major poker tournament ever held at the Sands, which would be imploded by a demolition squad just a few years later. The Sands wanted in badly on the poker action. So, Sands’ owner Carl Ichan (the investment titan, then the 15th richest man in the world) and his casino management team hired Savage and Shulman to run their event — and they brought me in to handle the PR. The Sands was going all out. They even worked a deal with NBC to televise the poker championship, which was to be called “Showdown at the Sands.”
The event turned into a sideshow and a circus. At one point, I spotted Doyle Brunson, who’d flown across the country to play, sitting in the back of the room shivering in a blanket. There were licensing issues and problems with the New Jersey Gambling Control Board. Staff got into fights. Then, the television crew came up with a crazy idea to place heart monitors on each player at the final table in some poorly-conceived attempt to add to the poker drama by showing the players’ heart rate when shoving all-in with a bluff. The only problem was, the heart monitors didn’t work because players kept scratching themselves, giving off false readings. The tournament was a disaster.
Even more interesting — Ben Affleck was dating Jennifer Lopez at the time. Both were scheduled to show up and stay at the Sands because Affleck decided he wanted to play. Affleck was in the middle of his poker phase at the time. J-Lo knew she’d be bored to tears for hours if not days while Affleck was downstairs competing in the championship. So, she invited her mother to come down from New York City and join the celebrity power couple. While everything else was going on, Affleck, Lopez, and her mom were seen hanging out in the poker room, the two Lopez’s were none too pleased with the arrangement. Hounded by autograph seekers, Affleck and Lopez openly argued. Eager to get away from the swarms of gawkers, Lopez’s mother started playing $25 slots and hit a jackpot. That brief moment of ecstasy likely bought Affleck a little extra time and a temporary reprieve from J-Lo’s nagging. Still, Affleck busted out on the first day.
What was even more bizarre was the obscene bidding war that broke out between rival online poker sites when the final tablists had been determined. Eager to get their logos on national television, the bidding started at $20,000. Some players got $50,000. The chip leaders negotiated their price all the way up to a staggering $100,000.
$100,000…..to wear a fucking patch.
Poker had indeed changed. Nothing was the same.
The world had gone insane.
When I returned to Las Vegas from Atlantic City, I received an interesting phone call. Apparently, my previous meeting with Mr. Dikshit had made an impression. Dikshit, speaking on behalf of Party Poker’s management team, informed me that they wanted to hire me.
The offer on the table was $120,000 per year to start, plus a nice year-end bonus. I’d be a consultant. And, Party wanted me to continue working at the Horseshoe and for the WSOP. It was a stunning moment.
Officially, I’d be writing content for Party and their website. I’d established a pretty decent reputation as a fast and prolific writer, especially on the subject of poker. I privately wondered if Party’s generosity a payoff disguised as a job, but I learned that was not the case. Dikshit genuinely liked my work and thought I could add to Party’s position as the world’s preeminent poker site.
I didn’t know what to say. I didn’t know what to do.
As 2003 came to an end, I found myself at the apex of the poker universe. A bi-weekly column in Card Player. Director of Public Relations for Binion’s Horseshoe. Media Director for the World Series of Poker. A paid part-time consultancy for Shulman Media. And now, an offer was on the table to work in media for the world’s biggest and richest poker company.
I almost accepted the position but decided to wait until after the holidays and the coming new year. My concern with the odd arrangement (not to mention the conflict of interest) was — I didn’t know what the Family would say. By that, I meant Nick and Becky.
Those concerns were obliterated on the morning of January 9th, 2004, when Binion’s Horseshoe, the crumbling ruin of a former empire and the final vestige of the Old West that had once transformed dusty Las Vegas into a neon-lit magnet of vice, shuddered its windows and was padlocked by U.S. Marshalls in a legal struggle that would become the final nail in a coffin filled with memories.
Suddenly out of work and no place to go, I was about to gleefully accept Party’s offer. But by some accident, I ran into a dear friend who took an immediate and unexpected interest in my career and future.
When told of my intent to go to work for Party, Rich Korbin begged me to hold off and apply the breaks. “Give me 24 hours,” he said.
Korbin was the Director of Marketing for PokerStars.com.
Entirely out of friendship and my respect for Rich, I agreed to wait 24 hours before calling Party with my final decision and acceptance of their generous offer, made even more attractive now by the sudden realization I was unemployed.
I wasn’t sure exactly what Rich was up to.
And so, I waited.
It was a long 24 hours.
Tales of Fast Money, Wicked Beats, and Broken Mice: Chapter Four — Star of the Party (2004-2006)
Photo Credit: The photo above was taken by Eric Harkins (ImageMasters) at the 2003 World Series of Poker.