Zynga is arguably the largest online gaming creator. And back in December of last year we reported here that the company was investigating ways to enter the online gambling market. Long a provider of free play online casino games at social networking destinations like Facebook, the company announced on April 3 that they have begun a partnership with Bwin.party Digital Entertainment, and would be entering the real money gambling sector in the United Kingdom immediately.
Initially two real money games would be launched that would allow anyone over the age of 18 in the United Kingdom to play for money at ZyngaPlusPoker and ZyngaPlusCasino. The company’s stock has recently been taking a beating, but surged on news of the real money gambling move. Of the date that the company made the announcement, Zynga stock climbed as much as 15%. As outlined in the press release, gambling operations would be handled by Zynga’s new partner Bwin Party Digital Entertainment Plc., the front-runner in the UK online gambling sector.
Under terms of the agreement, the Gibraltar-based Bwin will handle security issues as well as gaining licensing. Online gambling analysts as well as investors are convinced that involvement in real money online games would help turn around the sinking Zynga stock. Zynga is based in San Francisco, and the move into the UK real money gambling sector would benefit by the company’s already favorable relationship with Facebook. By providing access through Facebook to smartphones and other portable PCs, Zynga could tap into the huge player pool they have already built at that social networking giant.
Getting their feet wet in the United Kingdom could also be a way to show United States investors and possible online partners that they are ready to offer their pay for play online services at home. With New Jersey, Nevada and Delaware already legalizing online gambling, and multiple states pushing forward as well, Zynga is positioning itself properly to benefit from what some researchers estimate to be a $7.5 billion per year industry in the United States alone as early as 2017.
United Kingdom research firm H2 Gambling Capital predicts that level of financial strength, and Zynga would be able to immediately transform many of their millions of free play casino gamers to a paid version. Zynga Chief Revenue Officer Barry Cottle said that the company’s long-term vision is to “offer our players the next generation of real money games on multiple platforms in regulated markets worldwide.” The UK is just the first step in a global plan, and ZyngaPlusPoker and ZyngaPlusCasino need to be successful overseas so Zynga can launch their virtual services in the United States once favorable legislation is passed.