Further to our report on Betfair’s decision to extend its poker software license with Cryptologic, the latter company has commented on the arrangement.
The Canadian Press reports that Betfair provides as much as a tenth of the Toronto software companys revenue but that, “It is expected there will be no material effect on CryptoLogic’s 2005 and 2006 results” as a result of Betfair’s previously announced plan to develop its own poker software and cancel its arrangement with CryptoLogic’s WagerLogic licensing subsidiary. CryptoLogic shares fell 17 per cent in one day in August after the company disclosed it could lose Betfair as a customer in early 2006.
CryptoLogic revealed this week that its arrangement with Betfair will not now end early next year as previously feared. Instead, the contract will continue until at least June and may be extended to January 2007.
The Betfair licence has typically provided five to 10 per cent of CryptoLogic’s revenue, the Canadian company said. But revenue from poker licensees other than Betfair has doubled this year, and CryptoLogic’s core business remains its casino software, which provides about 60 per cent of its revenue.
“We have enjoyed a mutually profitable relationship with Betfair and we are pleased that the relationship will continue in 2006,” stated CEO Lewis Rose.
“CryptoLogic has grown into a well diversified organisation – in its customers, products and markets. This means continued growth from our core customers, continued financial strength to invest in new products, and the continued prospect of new partnerships.”
London-based Betfair has about 300,000 registered customers and claims that Betfairpoker.com, launched in May 2004 using the WagerLogic central poker room shared by all of CryptoLogic’s poker licensees, averages 18,000 active players a month.
Steve Ives, director of Betfair Games said earlier that it had always been Betfair’s strategy to own and operate its own software for all core products. “We are pursuing ways to do this and will be ready to proceed when the current contract expires,” he said in complimenting WagerLogic for its services.