PartyGaming Latest to Cut Jobs in Online Gambling Sector
PartyGaming, once the largest online poker firm, has announced it will be laying off more than 100 employees in its Gibraltar office. Just two weeks ago, Bodog, another of the industry's largest gaming companies let go of nearly 300 of its employees in North America. The cuts come at a time where both companies have had difficulties converting new customers and retaining existing one's.
According to the Gibraltar Chronicle Friday PartyGaming confirmed a redundancy plan and has reportedly informed staff of a sixty day consultation to see what posts will be in the firing line.
Spokesman John Shepherd told GBC the company had been forced into this position by changes in the gaming market. He complained of unfair competition and said some rival
Companies had remained active in the US despite passage of the Unlawful Internet Gaming Enforcement Act in October 2006 that forced PartyGaming out of that market. Prior to passage of the UIGEA, which makes it illegal for banking institutions to knowingly allow transactions for online poker, more than 80 percent of Party's customer base was located in the United States.
SDespite the prospect of job cuts, PartyGaming said it was committed to Gibraltar and planned to introduce new posts in the future. The company currently employs around 320 people in Gibraltar, which has become an important Web gaming hub over the years.
Last week PartyGaming reported a drop in the number of people playing its Poker games in the last two months, overshadowing positive first-half results and prompting downgrades to earnings forecasts.
At the time, Chief Executive Jim Ryan, who joined the company at the end of June, said the Poker business was continuing to be held back by competition from sites which accept players from the US.
"This represents a continuing competitive threat to listed businesses like PartyGaming that immediately stopped customers in the US from playing or making deposits on any of the group's real money sites following the enactment of the Unlawful Internet Gambling Enforcement Act," Mr Ryan said
PartyGaming is now the 4th largest online poker company, but has had difficulties holding onto the position even with rivals that are not competing in the US market, iPoker Network and OnGame among them. PokerStars, which still accepts US customers, is the largest online poker room.
In 2004, PartyGaming was the largest IPO on the London Stock Exchange.
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Christopher Costigan, Gambling911.com Publisher
