Zynga Moves Toward Real-Money Gambling in Nevada
Zynga, the creator of popular social gaming hits like Zynga Poker and Farmville, announced this week that it has taken the first step toward offering real-money gambling games in the U.S.
In a statement received by PokerNews on Wednesday, Zynga said it has filed an "Application for a Preliminary Finding of Suitability" with the Nevada Gaming Control Board. Nevada gaming regulators will now determine whether Zynga is suitable to hold a gaming license in the state, a process that the company believes will take 12 to 18 months to complete.
Zynga's shift to real-money gaming comes after the company shed three quarters of its market value since its initial public offering last December. The IPO was initially priced at $10 per share, but the stock fizzled on the first day, casting doubts about the share valuation and the sturdiness of the company's free-play business model. The company has been seeking new forms of revenue streams since it took a steep slide in paid advertising and sales of virtual goods.
Zynga CEO Mark Pincus said in July that the real-money gambling market would be a "natural fit" for company. He invested in the transition by hiring Maytal Olsha, a former executive at 888 Holdings, to head up Zynga's move into new markets.
"As we’ve said previously, the broader U.S. market is an opportunity that’s further out on the horizon based on legislative developments, but we are preparing for a regulated market," Zynga Chief Revenue Officer Barry Cottle said in the statement. "We’ve also recently partnered with bwin.party to bring the highest quality real money gaming experiences to our UK players in the first half of 2013."
It's still unclear when online poker will launch in Nevada, but more than a dozen companies have already received interactive gaming licenses, including MGM, Boyd Gaming, Golden Nugget, South Point and Fertitta Interactive. On Wednesday, Caesars Entertainment Interactive received preliminary approval for an online gambling license from the control board.
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