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Originally Posted by northeastbeast2
Your logic is flawed.
No you are!
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This deal was worth more to PokerStars than it would be to anyone else. The only way that the deal would make sense strategically would be if the players get paid back. The value of the software could only be restored that way because the amount of work required to make the origin of the software untraceable to another buyer who wanted to use it in the future would be substantial. The risks involved in such a transaction would be unknown.
You greatly overvalue the software to a company like PokerStars as well as the expense of managing two completely different code bases, development groups and infrastructures that do basically the same thing.
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It could be argued that the only buyer that could have paid back the players and justified the price would be PokerStars.
I would agree with this. If PokerStars didn't buy FTP players would be ****ed. Just because they were the only ones that could have doesn't mean they were required to.
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They are also going to make megabucks off the deal from the European deposits that they will be "refunding". That money will be going right into the accounts and so you can discount that amount by half right from the start.
If someone owes you 1 megabuck but can't pay you and I agree to pay you that 1 megabuck back
just for the chance that you might do business with me (and you already may be doing business with me since the other guy went out of business) and transactions will earn me a teeny tiny fraction of a megabuck, how much megabucks do I have?
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Additionally you get a whole bunch of players that have never played on your site before so it greatly increases overall market share.
What?
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So him wanting to bail out players might be a nice thought but this deal removes huge amounts of financial risk from the table for them because they do not have to admit wrongdoing and they have capped out the amount they will have to pay.
The were going to do this anyway. Settlements of this type are common with the DOJ and Stars was under no obligation to do anything related to FTP or it's players and would have saved money by not including FTP in it's settlement. i don't think the FTP deal is going to be as lucrative as some people think and I was surprised they did it. I don't have any inside details though.
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I estimate that their net revenue from the new poker site will pay for the entire deal within 3 years maximum.
I'm curious to know what you think the total cost of the deal is to Stars?
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The guy is brilliant and the company is excellent but this seems to be a case of doing the right thing because it is the most profitable thing. Which is what they consistently have done and it is why they are one of the best run companies in the world.
Now if they can figure out how to get poker legalized in the United States and get access to the market they will achieve legendary status.
So you're going to wait until legendary status until you would even type 9 little characters on a forum to express some gratitude to a person that put out hundreds of millions of dollars that will directly benefit players and had to step down from his company to make it happen?
I never expected I might regret starting this thread.
Am I missing something here? Does Scheinberg insist that Stars use a farm of underage slave labor to actually shuffle cards instead of an RNG?