The announcement by the Stars Group (PokerStars) that redundancies will be made at its Isle of Man headquarters is the latest consequence of the maturation of the e-gaming sector.
For PokerStars one key event in this process was the sale by the company’s founders and the transformation from private company to public company with outside investors to satisfy.
The process of regulation has also made the need for offshore licences less essential. The model of one licence targeting many markets is now less relevant for public companies. The Stars Group, for example, states it now “holds licenses or applicable approvals to operate in 23 jurisdictions”.
In fact, according to the Isle of Man Gambling Supervision Commission, the only PokerStars URL now run under an Isle of Man licence is the free-play .net website.
With licensing has come increased taxation and compliance costs, which have hit the profitability of several companies.
At the time of the redundancy announcement, the Stars Group said, “As we’ve previously noted, our international segment (PokerStars) has faced many headwinds over the last year, including disruptions in our key markets.”
In the first six months of 2019 revenues in the group’s international segment fell by 13.8%, including a 12.4% fall in the poker segment, which still accounts for the bulk of international revenue.