Boost poker profits automatically
Boost poker profits automatically
PokerTek offers equipment that raises the stakes in poker rooms through faster play and fewer support staffers
By James J. Hodl
Sometimes a great notion leads to big things.
One of the more notable notions occurred during a 2003 meeting of computer and gaming industry veterans brainstorming the formation of a new company to serve the already rapidly growing poker market. The result was PokerTek Inc., a Matthews, N.C.-based firm that created and currently markets innovative products that enable casinos to expand revenues and profits while trimming overhead costs in their poker rooms.
It was all a matter of finding the right niche in the poker market and the right product to serve it, said Lou White, one-time sales executive of Dell Computer and current chief executive officer of PokerTek.
Only a few years earlier, the televising of Texas Hold 'Em tournaments and the creation of the World Poker Tour and other programs made poker appealing to a new, much younger generation of players. Almost overnight, these younger Texas Hold 'Em players nudged aside the older aficionados of five-card stud and seven-card stud in poker rooms. This ended the long decline of poker as a source of casino gaming revenue, and casinos began to expand the number of tables in their poker rooms.
As the veteran executives debated how they could serve the burgeoning poker market, a pivotal observation was made by Lyle Berman, former CEO of WPT Enterprises Inc. and Lakes Entertainment Inc., and current PokerTek board chairman: "You know, 25 years from now there won't be any dealers at poker tables."
"From that point on, our budding enterprise took a hard turn in the direction of dealerless gaming and we never looked back," White said.
Dealerless design
The immediate result was the formation in the fall of 2003 of PokerTek as a company dedicated to helping casinos and poker rooms maximize revenues by providing innovative equipment that speeds up play while reducing staffing requirements. Much of this goal was achieved by the development of PokerPro, a completely automated poker table that enables up to 60 percent more hands to be played per hour without a live dealer.
Several factors were considered by PokerTek engineers in developing PokerPro.
A chief factor, White said, was that at a poker table, a dealer wasn't really necessary due to the radically different relationship between dealer and players in a poker room and in the table game pit. With table games, players play against the house, so a dealer was needed to play a hand for other players to beat. But at a poker table, players play against each other, with the dealer providing only an unbiased shuffling and distribution of cards.
Another factor was that online poker rooms were becoming the main competition to the live version. Many budding poker players had their first exposure to the game online where up to 70 hands can be played in an hour. After this exposure, White noted, live poker games presided over by dealers seemed slow, due to the need to rake in actual cards, move bets off the table, reshuffle cards and deal new hands. And things like mistakes in dealing and the accidental flip-overs of hold cards can slow down the game even more, if not negate some hands.
"In designing the PokerPro system, we gave it the look and feel of a live poker table, but use computer technology to speed up the game and eliminate the annoying errors," White said.
Play and support
Each 10-position PokerPro table employs virtual cards and gaming chips. It automatically shuffles and deals cards. Built-in technology creates side pots, splits pots, displays winners and awards pots instantly. By cupping their hand and touching the top of a hold card, the card is revealed only to that player. Players also have the ability to select any chip denomination they choose to stage and ultimately confirm a desired bet.
Video touchscreens at each player location provide options for players to fold, call or go all in. Data on the player screen notes the size of their stack (how much they have to bet), the size of the main pot and how much they need to bet to call a hand. The center video screen displays all community cards and indicates the winner when hold cards are revealed at the end of play. Players can recall the previous hand to analyze how they played it.
"PokerPro provides all the benefits of online poker, but adds the fun of playing with real players you can see and 'read' for clues on how to bet," White said. "It's the best of both worlds."
Current PokerPro systems play off forms of Texas Hold 'Em poker, including Limit, No Limit and Tournament. In the works are systems that will play other forms of poker, including Omaha Hold 'Em-a slower game in which it's harder to determine who won-which PokerTek feels it can make popular by speeding it up so that more than 15 games can be played each hour.
Supporting PokerPro are peripheral systems that offer additional benefits and are offered as a package to casinos.
To further speed up play, PokerTek also offers the Waiting List Kiosk, a free-standing station with a touchscreen monitor that enables players to sign up to play a table of their choice. Poker enthusiasts simply swipe their player cards in the kiosk and follow directions on the screen. When the desired seat becomes available, the device reserves it for the player and directs him to it.
"This system further reduces staffing requirements for casinos and card rooms, thus directing more revenues to the bottom line," White said.
The Customer Management System enables players to create their own accounts, receive player cards, and add and withdraw money onto them. For poker room operators, this system verifies how much money is in play, audits transactions and helps produce standardized financial reports.
PokerPro Director monitors the action on all PokerPro tables, enables poker room supervisors to set game limits and to start, pause and stop games as required from a portable wireless tablet.
The PokerPro Player Account System records information on player behaviors and game preferences-information that can be used for comping and creating customized promotional strategies for individual players. Such data can also be used to identify a poker room's best customers so they can be given the VIP treatment on each visit.
Market reach
PokerTek installed its first PokerPro tables on May 24 of last year at the Seminole Hard Rock Casino in Hollywood, Fla. Since then, tables have been installed at other tribal casinos in Florida, at Hollywood Park in Los Angeles, and 20 tables were installed at the Crown Casino in Melbourne, Australia. To sell to the foreign market, PokerTek recently contracted with Aristocrat Leisure Ltd. as its distributor outside the U.S. and Canada.
According to White, the market for the PokerPro system is substantial, with about 6,500 poker tables in operation worldwide, with about 1,300 tables in California alone. But getting casinos to go dealerless will take some education, White admitted.
"PokerPro is a radically different product, much like the automatic card shuffler was a few years ago," White said. "PokerPro is currently in the novelty stage, as far as the gaming market is concerned.
"However, once casinos understand the financial benefits-that they can increase revenues by playing at least 50 percent more hands of poker per hours, while reducing expenses through fewer salaried support staffers-it will move to the accepted stage and eventually become an industry standard. This will require some effort on our part, to promote the benefits and get casinos to put PokerPro in operation. And we are up to that task," he added.
SIDEBAR:
PokerTek at a glance
PokerTek Inc.
1020 Crews Rd., Suite J
Matthews, N.C. 28106
(704) 849-0860, Fax: (704) 849-9148
www.pokertek.com
Listed as PTEK on NASDAQ
Executives:
-Lyle Berman, chairman
-Lou White, chief executive officer
-James Crawford, president
-Hal Shinn, chief technology officer
-Chris Daniels, chief financial officer
Company focus:
Computerized products and software for casino poker rooms and card clubs
Products:
-PokerPro System automated dealerless poker table
-Waiting List Kiosk
-Customer Management System
-PokerPro Director
-PokerPro Server
Major markets:
Casinos, tribal casinos, card clubs
Major affiliates:
Aristocrat Leisure Ltd. distributes products worldwide (except for U.S. and Canada)
