PokerStars’ twin US Winter Series have now both wrapped up. Pennsylvania’s inaugural Winter Series concluded on Feb. 1, the day before Super Bowl Sunday. For New Jersey, it was the third run of the annual series, and it finished on Jan. 26, just as Pennsylvania’s was getting underway.

So what can we learn from the expansion of online poker in the US?

Going bigger the second time around for PokerStars

Aside from their timing, the two series also had differences in schedules and marketing. New Jersey’s was similar to last year’s, but a few extra events on the schedule. Pennsylvania’s had more events (30 vs. 21) and bigger guarantees ($675,000 vs. $300,000). The company also chose to use a football theme for the Pennsylvania series, hoping to cash in on Super Bowl hype.

Winter Series was PokerStars’ second major tournament series as it gets into online poker in Pennsylvania. It was, however, the first time that the company attempted to take advantage of the site’s higher traffic to run a bigger series than in New Jersey. PokerStars Pennsylvania’s first series, PACOOP, copied New Jersey’s NJCOOP schedule almost exactly. Although some guarantees were raised partway through the series, many of these resulted in overlays.

Winter Series by the numbers

In some regards, Winter Series Pennsylvania can be regarded a success. While it did end up running seven overlays on thirty events, these amounted to less than $16,000. Meanwhile, five events beat their guarantees by 50% or more.

All told, the series generated over $828k in prize pools, well over the $675k that was guaranteed. That’s more than twice the $392k in prizes distributed during New Jersey’s series, though not quite as large an excess over the guarantees as measured in percentage terms.

On a per-event basis, Pennsylvania’s series had an average prize pool of over $27,000. The average event in New Jersey had just under $20,000 in prizes.

Perhaps the greatest success in Pennsylvania was the Main Event, which drew 452 entries on a $300 buy-in. As a result, it produced the only six-figure prize pool of either series, at $126,560. New Jersey’s Main Event had less than half as many entries, albeit at the slightly higher price point of $400.

Success is relative in online poker

Many in the media, as well as PokerStars itself, are pointing to those numbers as evidence of how well PokerStars is doing in Pennsylvania. Indeed, the site has, overall, exceeded expectations since its launch in early November last year. However, when it comes to Winter Series specifically, what these numbers say is largely a matter of framing. Compared to other metrics, the performance of the series is a bit lackluster.

The first thing to consider is the difference in population between New Jersey and Pennsylvania, as well as the fact that PokerStars continues to enjoy a monopoly in the Keystone State. At around 13 million people, Pennsylvania is about 45% larger than New Jersey. Thus, we’d hope for PokerStars Pennsylvania to do 45% better than PokerStars New Jersey at a bare minimum.

Furthermore, PokerStars has only about a one-third market share in New Jersey. (Here is a closer look at NJ online gambling revenue.)

Of course, demand for gambling is elastic, so competitors aren’t dividing up a fixed pool of players. New Jersey is also a considerably more mature market than Pennsylvania. Even so, given the lack of competition, PokerStars Pennsylvania should have the potential to beat New Jersey by considerably more than the 45% margin conferred by population alone.

Splitting events up by buy-in, what we see is that Pennsylvania’s Winter Series beat New Jersey’s by the most significant margin in the lower stakes events. At the $30 and $50 buy-in tiers, Pennsylvania’s events drew fields almost twice the size of New Jersey’s. On the other hand, in $100 events, Pennsylvania field sizes were scarcely 50% larger than New Jersey’s, and at higher buy-ins the difference was even less.

In other words, it’s only in the lowest-stakes events that Pennsylvania’s Winter Series exceeded New Jersey’s by more than would be predicted by population difference alone.

Pennsylvania cash games have been more impressive

That’s in stark contrast to PokerStars Pennsylvania’s cash game traffic. Average player counts for the site’s ring games were north of 450 shortly after launch, exceeding all predictions.

Though they’ve since come down to around 375, that’s still about four times what PokerStars New Jersey gets. Therefore, when it comes to cash games, the Pennsylvania site has performed at the extreme top end of what would have been considered possible based on the state’s population and lack of competition.

Nor was Winter Series a particularly big generator of revenue. Deducting the overlays, it pulled in just under $52,000 in gross gaming revenue, or an average of $6,500 per day that it ran. We don’t have January revenue numbers for Pennsylvania yet, but using December’s, we can estimate that PokerStars Pennsylvania’s normal daily revenues are about ten times that, at $65,000. As with cash game traffic, that number is almost four times greater than what the company makes in New Jersey.

What’s holding PA poker tournament numbers back?

If PACOOP and Winter Series are representative of the overall performance of scheduled tournaments at PokerStars Pennsylvania, then it seems that the site isn’t having quite the same success there as with its cash games or its overall revenues. The question, then, is why?

The relatively stronger performance of the lower buy-in events is probably one clue. This suggests that the current player base in Pennsylvania skews more recreational than that in New Jersey.

That’s often the case for a newly launched site, and it also jives with reports from the site’s professional players, who described the competition as having been soft shortly after launch. With buy-ins starting at $30 and slower-than-normal structures, Winter Series may have represented too large a commitment of time and money for many such players.

PokerStars’ monopoly may also be less relevant for scheduled tournaments than it is for cash games. Most cash game players have little incentive to move around between sites. With the exception of high-stakes players, once a cash game player has found a game they like, it will usually be available whenever they want to play.

The same isn’t true for scheduled tournaments, especially when it comes to special series. It stands to reason, then, that tournament players would be more willing to have accounts at multiple sites and move between them depending on tournament availability.

The difference may be temporary for US online poker

If these guesses are correct, then the situation may change with time. As the site matures, the recreational player population will likely dwindle due to attrition. Furthermore, when competitors’ sites open, PokerStars cash game player base might get split. Conversely, even tournament players who switch sites will likely return for the likes of Winter Series and PACOOP.

In other words, it may not be the case that Winter Series — or scheduled tournaments in general — are underperforming. On the contrary, cash-game traffic and revenues will probably drop eventually due to competition and the end of the proverbial “honeymoon period” sites often experience after launch.

Indeed, current tournament numbers might be painting a more accurate picture of what to expect for the site in the long term than its cash game traffic and gross revenue.