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Harrah's Closed Down!(LuckyMe)

Discussion in 'Casino Industry Discussion' started by Petunia, Mar 8, 2005.

    Mar 8, 2005
  1. Petunia

    Petunia Dormant account

    Online Casino Closes Due to Poor Performance
    6 March 2005


    A well known online casino has been shut down and will remain non-operational due to poor performance and huge financial losses. There have been other online casinos that have closed in the past but the trend is relatively rare in the profitable online casino business. The industry rarely sees entire operations close down but just as some online gamblers dont always come up winners, the online casinos also take a loss. In this case it was Harrah's Entertainment Inc that has been permanently closed due to heavy financial losses and negative profits.

    Harrah's Entertainment online casino, based out of the U.K. has decided to terminate their operations after posting losses of $9.3 million last year. The online casino industry is usually quite profitable and it is rare that online casinos close up but Harrahs was a different type of casino with a different type of gaming structure. At this online casino the players could access as many games as they wanted based on a monthly subscription. There were different packages they could sign up for and essential they could play as much as they wanted within a certain time frame. This structure is rather different for an online casino and has proven to be less profitable for the owners than the standard model which is based on depositing on each game.

    The online casino LuckyMe, was opened in November 2003 to British casino players and was closed for business in October 2004. Ultimately, the online casino was discontinued because it was not making profits and taking heavy financial losses said a spokesman for the company. Also, in 2003, a similar case developed when MGM Mirage (the famous Las Vegas land based casino) shut down its gambling operations and online casino site due to uncertain legal stipulations in Europe. This online casino catered specifically to Europeans and online casino players in the UK.

    When an online casino closes it has to be for a serious reason because traditionally the online gambling business has proven to be very profitable. The online gambling structure of the LuckyMe casino was somewhat unconventional and this is probably why it took such large financial losses. Other online casinos will look at this as a learning experience and will also use it to figure out ways not to go bankrupt.
     
  2. Mar 9, 2005
  3. GrandMaster

    GrandMaster Ueber Meister CAG

    Occupation:
    Mathematician by day, online gambler by night.
    Location:
    UK
    I would hardly call LuckyMe well-known. I heard more of it since it closed down than while it was operating. It tried a new business model instead of licensing one of the major brands of casino software and it did not work. The land-based casinos may not always realize how different the online casino business is, and those based in the US are further hampered by not being able to accept US players.
     

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