In a deal worthy of giants, CryptoLogic, an online pioneer and one of the world's largest online gaming software firms, has reached a landmark partnership with Boss Media AB, a subsidiary of GTECH Corporation. The deal is an Internet poker-specific agreement in which CryptoLogic's poker customers will be merged with Boss' IPN, International Poker Network with the transition scheduled to take place by Q1 2009. The partnership seems to be a natural fit as GTECH, who operates in 50 countries with 5,900 employees is a leading gaming technology and services company. They are expected to bring their creative content to CryptoLogic's partners to effectively manage and grow their gaming products. As a global leader in gaming software, one of CryptoLogic's biggest strengths is its regulatory compliance which keeps it on par with most land-based gaming entities.
Recently, CryptoLogic announced that its immediate corporate strategy would be focused around its Internet casino business through its games which are among the internet's most polished and popular. The merger is expected to generate $12-$15 million in cost savings per year beginning in 2009. Of the partnership, CryptoLogic's President and CEO, Brian Hadfield said:
"CryptoLogic's aggressive action on its new strategy, as witnessed in several recent announcements - and our new agreement with Boss Media, is a major step in our journey back to growth, profitability and returning shareholder value. This partnership provides our poker customers with access to one of the largest poker networks in the world, while helping CryptoLogic reduce costs substantially. Also, it will allow us to focus on the continued development and licensing of the Internet's most innovative casino games, and to leverage our lead in branded content games in partnership with the world's top entertainment brands."
With revenue streams decreased because of the UIGEA cost savings have become an increasingly important and viable method to increase companies' profits without additional capital expenditure. The thought process of which is that if a firm is able to maintain the same level of service while finding ways to streamline its own operations, they will be more in the green and thus be in a better operating position when revenue streams again increase.
It is expected that many of CryptoLogic's poker partners, including highly successful brands such as InterPoker and Parbet, will join the IPN by the 2009 first quarter timeframe. As a result, the sites will continue to use CryptoLogic on the back-end while integrating the IPN. This transition will be seamless for the customers resulting in no confusion or compromising of services.
The partnership seems to be a win for all parties involved, the two companies as well as the customer.
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Source: www.aintluck.com
