Ultimate Gaming withdraws from US egaming market
Las Vegas-based blames mediocre revenues and the "challenging operating environment" associated with state-by-state regulation
The stuttering regulated US online gaming market has claimed its first casualty after Ultimate Gaming revealed it was ceasing operations in Nevada just two months after the Las Vegas-based firm withdrew from the New Jersey market.
The company’s chairman Tom Breitling (pictured) said online poker revenues in Nevada had fallen “far short of original projections” and blamed the ongoing state-by-state approach to online gaming for created an “extremely cost-prohibitive and challenging operating environment”.
“These factors have combined to make the path to profitability very difficult and uncertain. Consequently, we have decided to cease operations,” he added.
The closure is effective immediately upon complying with regulatory requirements and Breitling said the firm was “working closely” with state gambling regulators to ensure a “smooth transition” for customers.
Ultimate Gaming became the first licensed and regulated online operator to deal a hand of poker over the internet in Nevada in April 2013.
But the Las Vegas-based firm lost ground to Caesars Interactive and its WSOP.com site, while struggling to gain traction in New Jersey.
It withdrew from New Jersey in September after land-based partner the Trump Taj Mahal filed for chapter 11 bankruptcy protection.
The regulated US egaming market has struggled to get off the ground, with player signups and revenues coming in below even the lowest pre-launch estimates.
The sector has been blighted by issues with geolocation locking legitimate players out of sites, plus payment processing and major banks refusing to process Visa and MasterCard transactions.
Even some of the larger operators such as bwin.party have revealed plans to scale back their stateside operations while markets mature and hopefully more states come online.
Betfair’s long-term future in the US market also looks uncertain, after land-based partner the Trump Plaza also closed its doors earlier this year.
The New Jersey regulator stepped in to allow Betfair to continue offering its BetfairCasino.com site to players in the state, with the online operator signing a six-month data center hosting deal with Caesars Interactive.
But Betfair will still have to find a new land-based partner if it wants to continue offering its site in the Garden State, as per egaming regulations.