ISSUE 10 • AUGUST 2020 MALTA
RTSMUNITY
Guaranteed esports profit for sportsbooks
The beating heart of the igaming sector
WILLIAM HILL CEO
COVID challenges, US stature and Brexit proofing
George Daskalakis The future for Kaizen Gaming
4-23 Sports Betting • George Daskalakis: The future for Kaizen Gaming • Rohini Sardana, SIS: The future is bright for esports
CONTENTS AUGUST 2020
• 1XBET: New amendments can bring down Kazakh industry • RTSmunity: Profitable esports betting complicated but achievable • Ulrik Bengtsson: William Hill focus on customer, team and execution
24-27 US Market • Jay Snowden, Penn: ‘We’re going to lead with the Barstool brand’ • A case of ‘when not if’ for single event sports betting in Canada
28-39 LatAm Market • CONMEBOL: Transferring transparency to the playing field • FIFA: Clear situations of corruption and match-fixing in LatAm • The relationship between online gaming and the retail world
40-57 Casino • Malta: The beating heart of the igaming sector • Japanese culture key to unlocking online gambling success • Sustainable surge? Examining the recent poker boom • Coingaming: Content still king but we need to keep innovating • No waiting game: Lightning Box ready for pan-American rollout
58-63 Payments • Is retail betting on the cusp of a new cashless normal? • AstroPay: Thinking like the customer to accelerate cashless shift
64-76 Marketing • Diversification the best response to regulatory change • A decade of SofaScore: Adapting to the affiliate landscape • Digital future for SBC’s Europe, America, CIS & Africa events
The SBC Magazine is brought to you by SBC - Sports Betting Community: EDITORIAL TEAM: Luke Massey, Andrew McCarron, Craig Davies, Ted Menmuir, Joe Streeter, Chris Murphy, Erin Gallagher, Tom Daniels, Matthew Ramirez, James Ross, Lucia Mouriño SALES TEAM: Rasmus Sojmark, Alyona Gromova, Conall McCabe, Neil Judson, Liam Machin, Reece Calderbank DESIGNED & DELIVERED BY Better Mags (bettermags.co.uk) All material is strictly copyrighted and all rights are reserved. No part of this publication may be reproduced in whole or in part without the written permission of Sports Betting Community Ltd. Although every effort has been made to ensure the accuracy of the information contained in this publication, Sports Betting Community Ltd cannot be held responsible for any errors it may contain. Sports Betting Community Ltd cannot be held responsible for the loss or damage of any material, solicited or unsolicited. The views in the publication are not necessarily the views of Sports Betting Community Ltd or those of the advertisers. Produced and published by Sports Betting Community Ltd REGISTERED ADDRESS: Sports Betting Community, 103-105 Brighton Road, Coulsdon, Surrey CR5 2NG, UK TEL.: +44 (0) 161 367 1250 EMAIL: sales@sbcgaming.com WEB: www.sbcgaming.com
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INTRO Luke Massey Head of SBC Media
W
elcome to the fourth edition of SBC Magazine for 2020! Lockdown restrictions are gradually getting lifted in most places across the world and a form of normality is being restored to our daily lives, but unsurprisingly sports betting and gaming have not featured too high on the 'return to play' list. We've seen the belated opening of UK casinos, a false start for Irish betting shops and Italy's relentless pursuit of unpaid tax duties despite COVID realities as part of the government's plan to shrink the market (not limited to the retail side).
Even on the online side - the industry's golden ticket in COVID times - operators are being hindered by the regulatory brakes. A near blanket ban on gambling advertising still looks likely in Spain despite the financial fallout, while FIGURES COMING OUT temporary restrictions to OF BOTH THE UK online gaming in Sweden AND GERMANY HAVE came in seemingly without justification. SHOWN POSITIVE Figures coming out of SIGNS OF RECOVERY both the UK and Germany FOR THE SPORTS have shown positive signs BETTING INDUSTRY of recovery for the sports betting industry, underpinned by the successful Premier League and Bundesliga return, but even there some dark clouds are gathering. Germany is still jostling with the finer details for its new regulation of all online gambling product verticals, while the UK is in the run-up to reviewing the 2005 Gambling Act (although this is likely now on hold until 2021). Online slot stake limits, mandatory problem gambling levies, a ban on sports team kit sponsorship and the raising of lottery age
limits can all be justified, at least in isolation. But the likely pooling of such recommendations will only constrict operators that have already been squeezed hard by this spring’s sporting shutdown. Yet, amidst all of this, the industry continues to show incredible resilience and openness to change - as evidenced throughout this issue of SBC Magazine. You can read about the rebranding of Kaizen (Japanese for continuous improvement), the ‘beating heart’ of the igaming sector in Malta, how RTSmunity has built a profitable esports business, and why it is a case of ‘if not when’ for single event sports betting in Canada. And for those who missed it (I can’t think why you would have), we have three articles dedicated to key takeaways from our inaugural SBC Digital Summit Latinoamérica, including CONMEBOL's integrity objectives, how to market a sportsbook brand for the region and FIFA's response to clear evidence of corruption and match-fixing. Whether you are looking for the ‘hot take’ on issues related to sports betting, casino, payments or marketing, we’ve got you covered! And there’s so much more content for us to digest, starting with the SBC Summit Barcelona - Digital from 8-11 September. We hope to ‘see you’ in Barcelona, but if not, enjoy the magazine and let’s catch up at one or more of our autumn series of events, taking you across the virtual globe via SBC Digital Summit Africa (6-7 October), Betting on Sports Europe - Digital (21-22 October), SBC Digital Summit CIS (4-5 November) and Betting on Sports America - Digital (1-3 December).
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The Kaizen way
KAIZEN GAMING: REFLECTING ON THE PAST AND ENVISIONING THE FUTURE GEORGE DASKALAKIS REFLECTS ON THE COMPANY’S
rebrand and how continual improvement has formed the basis for its expansion, adaptation to the pandemic and support for local communities
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e sat down with Daskalakis, Co-Founder and CEO, to discuss the reasoning and symbolic nature behind the rebrand from Stoiximan/Betano, a new partnership with OPAP, opportunities in LatAm and why regulatory developments in Germany leave a lot to be desired. SBC: You’ve recently launched your new corporate brand Kaizen Gaming. What was the process behind this and what did you learn about the company? GD: This has indeed been a milestone for the company and our people. We originally built our identity around our Greek brand Stoiximan. Then in 2017, once we had managed to establish Stoiximan as the market leader in Greece and Cyprus, we embarked on our international expansion journey with the Betano brand. Today we are active in six markets, with two brands but one team of 750 highly committed and talented individuals. As for the branding of our group, to be honest being super passionate about building our brands and products led to us delaying it a bit more than we should have. But it was evident that our team could no longer go by the name of “Stoiximan & Betano” as we had started becoming known during the last year or so
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with our efforts now attracting more attention. Then again what many people don’t know is that we had actually been using Kaizen, which stands for continuous improvement in Japanese, internally for more than three years now for our Greek services branch, meaning it felt very natural for all of us to expand this name to the group as it had become part of our culture. You could hear people say “this was a very Kaizen thing to do” and even our events already had names like Kaizen Together, Kaizen Fest, etc. So
SBC: It must have been quite a year, as only a few months before this you also announced the deal with OPAP. How has this partnership affected the way you are managing the business so far? GD: I am glad to say that a lot has changed and at the same time very little has. The announcement concerned the second part of a deal that was originally struck in September 2018, with OPAP first investing in our group back then. Via the new deal, OPAP will control the majority of the Stoiximan brand, while maintaining an important minority stake in both the Betano brand and our Technology & Services arm. We really appreciate having a very strong and knowledgeable investor on our side, one that has a great history and enhances the Greek identity of our group, while being driven by people with a vision and great ambition for the future like Karel Komarek. When it comes to the operational side, this deal has not had the slightest effect so far, as Kaizen is operating with the same management team and philosophy it always had, which is clearly a great vote of confidence for our team. We are fully aligned with OPAP and aim to keep making Kaizen bigger and better together.
THE CHOICE OF NAME IS ALSO SYMBOLIC AS ‘CONTINUOUS IMPROVEMENT’ IS A CORE VALUE OF OURS AND AN INTEGRAL PART OF THE CULTURE THAT TOOK US SO FAR the switch to Kaizen Gaming has been very smooth for our team. The choice of name is also symbolic as ‘continuous improvement’ is a core value of ours and an integral part of the culture that took us so far. It has always been evident in our people’s passion to succeed, their drive to become better every single day. The whole corporate identity process actually gave us an opportunity to reflect upon this culture that brought us to where we are today and at the same time to envision our future.
SBC: Starting from Greece, now present in six countries. How do you see Kaizen Gaming’s international future? GD: International expansion is a key pillar of our strategy and obviously critical for our future. We went live in Romania in 2017, followed by Germany in 2018, Portugal in 2019 and Brazil just a few months ago, at a remote working mode during the peak of the pandemic. We are determined to continue pushing for organic growth. It is another process of continuous improvement.
SPORTS BETTING
With every market we expand to, we learn more on how to do this better and more efficiently every time. We believe a lot in building strong local teams though the level of difficulty of achieving this varies per market. As part of our strategy we are targeting regulated or soon to be regulated markets and are looking at adding two to three new markets per year from 2021 and onwards. With our size and financial backing now allowing this, we are also not ruling out making investments, if the right opportunity comes up. And for us, more than anything else, this means being able to work with highly motivated entrepreneurs and teams. SBC: How are you observing developments in Germany, where Betano seeks to operate as a licensed bookmaker?
GD: Our intention has always been to operate as a licensed bookmaker in Germany and our acquisition of Betkick, one of the 35 lawfully operating and tax paying companies in 2018 in order to enter the market, was a first step towards this direction. We also filed for the new interim sportsbook license earlier this year but the process was later put on hold. Unfortunately, the regulatory situation remains complex. It is crucial that all German states manage to reach an agreement that serves public interest and at the same time allows for the smooth operation of the regulated market. The latest proposal which is on the table leaves a lot of question marks when it comes to implementation, deadlines and limitations in offering which all need to be clarified before
operators can act in any direction. It is a pity that eight years after its first effort to regulate the online market, to witness a country like Germany trail so much vs the rest of Europe, still struggling to agree on a modern framework which will create order in the market by securing responsible gaming and at the same time effectively tackling the black market and protecting its tax revenues. We will continue to monitor and evaluate the development of the legislative framework in Germany closely and adjust our approach accordingly, hoping that a sustainable framework will eventually be implemented. SBC: What opportunities does the Latin American market and the Brazilian market in particular, have for Kaizen?
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The Kaizen way
GD: LatAm had been on our radar for a while. Our decision to expand outside Europe and enter this region was mostly linked to seeing solid signs of regulation on the way in Brazil, following those of other LatAm markets. As a sportsbook-driven operator with a strong mobile product, we believe that our offering can be very attractive for this region. The opportunity lies in the overall e-commerce development in LatAm with trust in online payments growing, as well as the overall migration from land based to online in our industry. In our recent entry in Brazil, we followed a different go-to-market model than in Europe. A more cautious, step by step approach, showing our humbleness while trying to put our footprint in a whole new continent. We will continue our expansion to more markets in the region but we do not have a set timeline for the next entry yet. We have entered the region in an agile way, learning from others and our own mistakes, listening to our customers and adjusting. Continuous improvement is not just a core value of our company but the actual way we do business. We take risks, make mistakes and try to fix them quickly while at the same time replicate success aggressively whenever something works well which is of course easier said than done. SBC: Kaizen Gaming strongly claims its part in the GameTech ecosystem. You promote a technology oriented product, using cutting edge technologies and even AI. How does this work? GD: The motive behind everything we do is to be able to deliver a premium customer experience to our users. This is not possible to achieve without leveraging cutting edge technology. Whether it has to do with the applications and sites via which we offer our product, the tools we use internally to offer customer service, KYC and payments, the platform our traders use to offer sporting events, responsible gaming or any other customer touch point, everything passes through technology. We are a purely online operator after all. We develop our front ends and applications internally having received international accolades as a
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mobile operator. We are proud to be currently using nine AI projects in production, ranging in areas from RG and operational automation (e.g. customer withdrawals) to sports and casino product personalisation. We are looking to extend this to customer rewards. Finally in the first half of 2021 we expect to complete our move to our 100% in-house developed proprietary betting platform Ariadne. Technology allows our people to be more efficient and to also focus on more creative rather than repetitive tasks. This hybrid approach combines the best of both worlds; the tremendous tech possibilities and the irreplaceable human capacities. It is also highly indicative of the future as we envision it.
THE OPPORTUNITY LIES IN THE OVERALL E-COMMERCE DEVELOPMENT IN LATAM WITH TRUST IN ONLINE PAYMENTS GROWING, AS WELL AS THE OVERALL MIGRATION FROM LAND BASED TO ONLINE
SBC: Under lockdown you launched a number of social directives, how were these received by the Greek Public? GD: The Covid pandemic is a global crisis in many ways. We instantly considered our own responsibility: for our people, our customers and the countries we operate in. Switching our people to full remote working mode was our absolute priority. We quickly managed to achieve this without jeopardising our product quality in any way, thanks to the commitment of everybody within Kaizen Gaming. We kept the spirit going via frequent updates about our performance and next steps, through personalised e-learning paths and support services and fun virtual activities. We adjusted external communications on the spot, leveraging media access and famous athletes to promote the “stay home” message, while minimising product communication to enhance RG practices. We contacted the health authorities in all countries and in consultation with them provided support across areas of need: donation of 250,000 masks for medical staff in Greece at a time where their supply was scarce, critical health equipment in Cyprus,
SPORTS BETTING
most people understand how sensitive we are about social responsibility and acknowledge Kaizen’s genuine interest and contribution.
monetary donations in Romania and Portugal through the Red Cross and in collaboration with our sponsored club SC Braga respectively. We developed a dedicated TVC for Greece that I am really proud of, featuring Olympic Champions and major sports personalities who applauded all Greeks for managing the pandemic crisis as one team. We produced a similar TVC in
cooperation with the football clubs we are sponsoring in Romania and Portugal. Responsibility is all about doing the right thing. It is not a matter of image, it is who we actually are. The reception to our directives has been extremely encouraging. It is not just about the Covid crisis by the way. I would like to believe that in all markets where we have been active for a while, and especially in Greece,
SBC: Betting returns from lockdown to a disrupted marketplace. What business dynamics are you assessing and is there any guarantee of ‘normal trading’ in 2020? GD: First of all, there is never a guarantee of “normality” and I think this is one of the biggest lessons this pandemic has taught us. Having said that, we are all quickly adjusting to the new conditions which is typical of human nature. So although we witnessed two extremely tough months, from mid March to mid May, with the sporting calendar almost reduced to zero, I believe that going forward even if there are more outbreaks most major sporting events will somehow continue to take place as the European soccer example has already showcased. Most probably not without obstacles, but overall I do not expect another complete freeze of sporting events. On the other hand, during Q2 we saw other products grow stronger or emerge, like gaming and esports, but as much as we value both and will continue to improve our offering in them, I think that in the short-mid term at least sports will continue to be king and we will remain a sportsbook driven organisation. Moreover with the pandemic often dictating a new way of life and consequently of entertainment, we hope that we will be able to respond to the consequences of the overall recession via taking advantage of the speeding up of the transition from land based to online which we have been witnessing. So overall a challenging period but I remain optimistic about the future. What is most important of course is that we manage to get back to some sort of safe “new normal” soon, not because of business but because of life and because there is nothing more important than our physical and mental health. So I look forward to that and to our next talk being a live one. Who would have thought we’d be missing shaking each other’s hand so much a few months ago. •
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Bringing esports to the fore
ROHINI SARDANA: THE FUTURE IS BRIGHT FOR ESPORTS AS ESPORTS CONTINUES TO GROW IN POPULARITY,
Rohini Sardana discusses SIS’ Competitive Gaming product and what the future holds for betting on esports
SBC: How important is the recent SIS Competitive Gaming deal struck with bet365 in helping to bring the product to a mainstream audience? How has the new service been received by bettors? RS: To have successfully launched our innovative esports betting product, SIS Competitive Gaming, with bet365, one of the world’s leading online operators, represents a landmark deal for this proposition. The size of bet365’s customer base will undoubtedly bring our esports offering to the attention of a wider audience and help continue the growth of the product. SIS Competitive Gaming was designed specifically to appeal to existing sports and casual bettors, in a format that is familiar to them, featuring fast-paced action that allows multiple betting opportunities. Ease of access and familiarity has led to great engagement amongst bet365 customers with our product since launching in May this year. The content, the frequency of events, and the live streaming has proved very popular, which is testament to the fact that SIS Competitive Gaming was shaped with
SIS COMPETITIVE GAMING WAS SHAPED WITH OPERATORS AND BETTORS IN MIND
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SPORTS BETTING
operators and bettors in mind. SBC: SIS recently doubled the output of content for its SIS Competitive Gaming product - is this a reflection of strong customer demand during its launch as well as a wider surge in the popularity of esports? RS: Absolutely – SIS Competitive Gaming has resonated extremely well with existing bettors, with frequent betting opportunities to drive turnover. The esports betting market has continued to grow and accelerated during the absence of live sports due to COVID-19 restrictions. We saw new providers with sports-related esports content emerge, however, a closer look at those products suggests a lack of experience in developing content that works well for betting operators, with high levels of latency
THE SIZE OF BET365’S CUSTOMER BASE WILL UNDOUBTEDLY BRING OUR ESPORTS OFFERING TO THE ATTENTION OF A WIDER AUDIENCE and long response times remaining an issue for many providers. In contrast, SIS Competitive Gaming has proven more engaging for bettors and more profitable for operators, due to the high production quality, integrity, and low-latency live streams, all helping to drive higher margins for customers. SBC: What has the expansion of the SIS Competitive Gaming service involved and what can customers
expect to receive as part of the full offering? RS: We’ve doubled our service with a seven-hour broadcast of back-to-back matches offering multiple betting opportunities, with the SIS Blitz League consisting of NBA2K20 games now taking place every weekday, Monday to Friday from 16:00-23:00 BST (11:00-18:00 EDT). We’re looking to introduce more events and content over the coming months, which will diversify our offering even further, catering to a global betting market. SBC: How does SIS Competitive Gaming differ and stand out to other existing esports products on the market? RS: SIS Competitive Gaming was developed with betting at the
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Bringing esports to the fore
forefront of our thinking. This is unlike other esports betting solutions, that are typically not optimised for betting, as they often have relatively poor streaming/data latency. In addition, the integrity of tournaments is a recurring challenge for events organisers and betting operators. One of the key features of our product and a key differentiator is the robust integrity measures that support our events and prices. SIS is one of the few, if not the only nonendemic esports supplier to invest significantly in this area and we are seeing that investment pay off. SIS Competitive Gaming addresses these key issues and is deployed in a proven format that delivers higher profits for bookmakers than competitor products. SBC: There has been a significant rise in the popularity of esports during the lockdown period. Do you expect this to continue or will there be a drop-off as more and more live sports make their full returns? RS: To some degree, bettors will naturally return to their favourite live sports and betting on those events as lockdown measures ease
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SPORTS BETTING
ONE OF THE KEY FEATURES OF OUR PRODUCT AND A KEY DIFFERENTIATOR IS THE ROBUST INTEGRITY MEASURES THAT SUPPORT OUR EVENTS AND PRICES globally. However, recent data from the Gambling Commission show a continuation in a higher level of betting on esports even as traditional live sports have reappeared, which is very encouraging for the esports betting sector. We see our content as being an important part of the offering for sportsbooks going forward, primarily as a complementary product to live sports, similar to virtuals albeit with higher engagement factor, rather than a direct competitor to mainstream esports, for example. SBC: With this in mind, what are the key steps that sportsbooks
RECENT DATA FROM THE GAMBLING COMMISSION SHOW A CONTINUATION IN A HIGHER LEVEL OF BETTING ON ESPORTS EVEN AS TRADITIONAL LIVE SPORTS HAVE REAPPEARED
need to consider to ensure their esports offering remains relevant and continues to attract even more bettors? RS: Industry statistics from the recent months have shown the surge in popularity of esports and the future is certainly bright for the vertical. There is a real opportunity for sportsbooks to drive increased profitability by ensuring that their offer is built with existing bettors in mind. Key to this is the way in which sportsbooks present the SIS offering to their customers, e.g. through product placement, engagement, and scheduling. SIS Competitive Gaming has core features built in to grab the attention of bettors while also helping them understand the product and engage with it for example, though in-play betting to drive turnover. SIS has proven experience in adding value to content by creating high value betting propositions for its partners and SIS Competitive Gaming has benefited from this expertise right from the start. •
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KZ regulatory changes
NEW AMENDMENTS CAN BRING DOWN THE KAZAKH BETTING INDUSTRY 1XBET DISCUSSES THE LIKELY LOSSES for bookmakers
as a result of the regulatory changes for land-based betting in Kazakhstan, including making drastic cuts to staff numbers because it is convinced players will just move online
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mendments to the law on Kazakhstan's gambling business were passed in the Senate at the start of July and have already been signed by the country’s president. We asked the CEO of 1XBET Kazakhstan Maksat Kurmanov for his take on the recent developments, set to come into play from 1 January 2021, including the controversial transfer of betting shops to special gambling zones.
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SBC: Can we get your opinion on the new amendments? Particularly the transfer to gambling zones - was this a good move? MK: Of course not, the removal of betting shops to gambling zones brings a huge change to the market. I believe that, first of all, you need to ask the question what goal is actually being pursued, because all over the world betting legislation is going in the right way. Recent examples include our neighbours Ukraine.
Many countries clearly understand the difference between bookmakers and gaming business. Since here, among bookmakers, the main component is an intellectual bet i.e. not just a bet on red or black in roulette, where each bet is a probability winnings. To place a bet in a bookmaker's office, you must at least have a sports interest. All over the world betting goes hand in hand with the development and popularity of sports, but in our country they have tried to move everything to these special gambling zones. We remember the transfer of slot machine halls and casinos to these gambling zones, but we still read news about underground structures engaged in this prohibited business in the cities of our country. For 13 years
SPORTS BETTING
WE REMEMBER THE TRANSFER OF SLOT MACHINE HALLS AND CASINOS TO GAMBLING ZONES BUT STILL READ NEWS ABOUT UNDERGROUND STRUCTURES ENGAGED IN THIS PROHIBITED BUSINESS
now, slot machine halls and casinos have been prohibited outside of special gambling zones, but actually they are still everywhere. SBC: What losses will a company such as 1XBET incur from this change? MK: In fact, it is still difficult for us to assess the losses that our company will incur as a result of such amendments
THERE AREN'T FUNDS IN THE KZ BUDGET TO SUPPORT THE CREATION OF A BETTING FINANCE OPERATIONS MANAGEMENT CENTER. ALL THESE COSTS WILL ULTIMATELY FALL TO BOOKMAKERS
to the law. But estimates are that bookmakers will produce from 70% to 90% in the form of budget money for the country and, naturally, a reduction in sponsorship contracts, which are measured in hundreds of millions of tenge. According to experts, tax deductions from the top three bookmakers last year amounted to
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KZ regulatory changes
about 18 billion tenge. Consequently, given the assumed 75% to 90% figures, the reduction in tax deductions will amount to somewhere in the range of 12-17 billion tenge. Nowadays bookmakers are creating workplaces in big cities and regions across the world, with cashiers, administrators, security guards, service personnel etc. In this case, we believe that a situation will arise when international bookmakers come to the Kazakhstan market and they will not need to obtain a licence or open betting shops to compete well. They'll just plug in several worldwide payments and start working. As for us this will create conditions for an unfair redistribution of the market. And the other thing to highlight from the new amendments is the creation of a betting finance operations management center, a bit like you see in Russia with TSUPIS. However, in the KZ budget there aren't the funds to
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SPORTS BETTING
support this. So it will be necessary to attract private investments someday to be returned. All these costs will ultimately fall to bookmakers. SBC: And if we talk more specifically about 1XBET? How much does your company donate to the KZ budget? MK: Last year, the deductions of our company amounted to more than 700 million tenge, while this year for the current period more than 1.5 billion tenge.
LAST YEAR, THE DEDUCTIONS OF OUR COMPANY AMOUNTED TO MORE THAN 700 MILLION TENGE, WHILE THIS YEAR FOR THE CURRENT PERIOD MORE THAN 1.5 BILLION TENGE
SBC: How many 1XBET staff are now working in Kazakhstan? And most importantly, how many active people will you keep on if the change goes through? MK: Our company at certain times operated more than 70 betting shops, but after the government increased the flat tax on betting shops at the start of 2018, we decided to reduce the number of shops to 22. We just left the most functional ones, where the client can offer everything he needs, we made repairs, updated everything equipment and furniture for the maximum comfort of our clients - investment amounted to about 400 million tenge in our top betting shops. After the adoption of the law, we will leave just one or two - for VIP clients living near Almaty and Nur-Sultan - as we are convinced that people will not go to the gambling zones for sports betting, but will place bets online. •
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Esports gamechanger
RTSMUNITY: MAKING ESPORTS BETTING PROFITABLE IS COMPLICATED BUT ACHIEVABLE PAVOL KRASNOVSKÝ FROM RTSMUNITY discusses the
path to success in esports betting, offering advice for sector newcomers on the most popular games, trading systems, demographics and how to approach the new generation of player
E
sports betting has been a hot topic throughout the last few months, there is no doubt. But alongside that, esports has become a bit of a buzzword. Every sportsbook around wants to have an esports offer which can be a huge success or, depending on the approach, also a big miss and a lost opportunity. I know it, because since 2016, when we began our journey in esports, we have made our own share of mistakes, and we want to make sure that every new story in esports betting will be a successful one. But how to do that?
What are the top esports? The first confusion about esports that appeared during the whole Coronavirus situation was around the basic definition of esports titles. While many operators were looking for alternatives to football or basketball in FIFA20 and NBA2K, those titles had been served just as a temporary solution before traditional sports came back. The reality is that esports fans are watching esports because they prefer them to traditional sports. If they want to watch traditional sports, they can do so directly. That's why the overwhelming majority of viewers and betting volumes are on the "big three"
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– Counter Strike, Dota 2 and League of Legends. At the moment, with Valorant coming on the scene, we may be looking at a "big four", but the message stays the same: if you want to break into esports betting, you have to understand your customers and fulfill their needs.
Profitability for sportsbook Now, once we understand which titles are relevant, the most important thing from a sportsbook point of view is profitability. Let's be honest, no one goes into the betting business with the intention to lose money. But making money in esports betting is different to traditional sports betting. There are several reasons, but there are two main ones. Firstly, the experience of trading traditional sports doesn't really translate to esports. So, any sportsbook that wants to do esports, has a long way ahead. Secondly, it is the infrastructure and the sheer amount of data traders
IF YOU WANT TO BREAK INTO ESPORTS BETTING, YOU HAVE TO UNDERSTAND YOUR CUSTOMERS AND FULFILL THEIR NEEDS
need to work with. Combined with the fast pace of these games, and a very strong preference of esports fans in live betting, esports betting is a completely new environment for sportsbook operators. When it comes to profitability, the sad truth is that many operators are currently losing money on esports. They don't have the correct data feeds, they use odds scraped from other sportsbooks with delay, and they don't have a proper trading system in place. All those things result in a negative experience not only for operators, but also for their customers, because of
SPORTS BETTING
the reduced uptime and the limited betting offer. We know very well how challenging it is to deal with those problems, because we had to establish our structure from scratch. That means building mathematical models created by our quantitative analysts, utilising our low latency infrastructure built on Amazon servers, and securing a data feed directly from leagues and tournaments. Building a company like RTSmunity was not an easy task, but combining these aspects led to a unique value proposition we have today, and that is a guaranteed profit for sportsbooks.
COMBINING THE FAST PACE OF GAMES AND STRONG PREFERENCE FOR LIVE BETTING, ESPORTS BETTING IS A COMPLETELY NEW ENVIRONMENT FOR SPORTSBOOK OPERATORS Not only are we able to make sure the sportsbook will be in profit, but we are able to guarantee a certain level of profit in the contract. That is obviously a game changer for many of them, because it solves the worry of going into a new territory and risking a loss.
Let’s bear in mind, making esports betting profitable is complicated, but achievable.
Who is betting on esports? But even with a guaranteed profit, esports is still an untamed territory for many operators. They cannot provide betting odds in the same way they do for horse racing or basketball. Esports are much more dynamic, fast, and connected through online communities. In the same way, esports fans are very different from the traditional sports fan. They are young, they are very good at using new technology, they are very well
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Esports gamechanger
informed and, most importantly, the majority of them are placing bets only on esports. What does that mean for sportsbooks? Esports fans are most probably not your customers at this moment. We have seen the strategy of treating the esports offer the same way as traditional sports just to cover the gap, but that does not work, because traditional punters are not that much interested in esports, and vice versa. So there is a whole new demographic waiting for engaging esports betting platforms, while there is very little to be found on the betting market.
How to approach the new generation There are several specific needs of esports fans that are not really answered right now. The first one is to have everything in one place – guaranteed betting odds, live stream, statistics, chat. This is an absolute must, which many sportsbook operators still struggle with. Another issue is to offer a wide range of markets, combined with a high uptime. I cannot stress enough
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SPORTS BETTING
how important this is, because the worst thing that can happen is to have a live match without a betting offer. If there is nothing to bet on why should the customer stay on your page? It will be just a glorified Twitch stream. Even if the match is one sided there are multiple side markets you can offer, resulting in an increased betting stake which would normally be lost. Take CounterStrike – no matter how dominant one team can be, betting
betting in two weeks. But how? By directly integrating it to the wallet, after which we handle the rest. This way, operators don't have to care about profitability, trading, stream, statistics, or resulting. Another use case is currently underway: our clients are starting the brand new esports only betting sites. They chose a header, logo, colour scheme, connect the payment solution and we are all ready to go.
THE WORST THING IS TO HAVE A LIVE MATCH WITHOUT A BETTING OFFER. IF THERE IS NOTHING TO BET ON, WHY SHOULD THE CUSTOMER STAY ON YOUR PAGE? on pistol rounds, or betting on map results with handicaps is always something that brings the engagement and fun. Or, if you are feeling lucky, bet on the exact score of the map! We know it's not easy to build up the whole product, which makes sportsbook operators hesitant. No one wants to invest in business if they know the needs of customers and how to offer them what they want. That's why we came up with a solution – Esports Betting Iframe that allows any sportsbook to have top notch esports
There is a long way ahead of us. Esports betting is still a developing market, which is currently under the microscope. But once you understand the needs of your future clients, and utilise the expertise that is available, esports betting will be a strong source of revenue for any sportsbook willing to adapt. For the year 2020 we expect esports to be in the top three for betting stake, but the race has already started. Operators who miss the spot today will have a hard time catching up later. •
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Customer, Team and Execution
ULRIK BENGTSSON: THERE IS MUCH, MUCH MORE TO COME FROM WILLIAM HILL WILLIAM HILL'S CEO
discusses the impact of COVID-19, Brexit-proofing operations and their position in the US market
A
fter taking the helm of William Hill in September 2019, Ulrik Bengtsson has placed significant focus upon ‘customer, team and execution’ to maintain the company’s position as a leading betting brand. We looked at Bengtsson’s first year as CEO, discussing some of the landmark moments over the last 12 months, monitoring the competition and future plans for international expansion as the William Hill brand grows its presence across the world. SBC: It’s coming up to one year since you assumed the CEO position at William Hill and it’s safe to say that 2019/20 has been very turbulent. What would you say have been the standout moments for you? UB: Since taking over as CEO, my focus has been on customer, team and execution. In terms of customers, we have been driving product development and seen our NPS scores improve as a result, and the strong performances of Mr Green and our UK online business illustrate that we are on the right track. There have been some critical milestones in our US growth including our CBS deal, enhanced working relationship with Eldorado and getting access to several new US states. It has also been great to bring in some new talent and reshape the exec team. And of course, the recent equity placing was a standout moment after the turbulence of the COVID lockdown.
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SBC: COVID has caused quite a lot of disruption across the world, what would you say have been the biggest challenges for William Hill during this period? UB: We had to act very quickly to protect our cash flow, which we did very successfully. We felt a massive sense of responsibility towards our colleagues, and we took the early decision to top up colleagues' furlough pay to ensure they received the full 100% of their wages during lockdown. Our colleagues’ health and wellbeing are always forefront in our minds, and we hosted a lot of remote workshops and provided lots of interactive content aimed at keeping our colleagues safe and connected during these unprecedented times. As well as closing down our retail estate and seeing all live sports cease, we also had to get the rest of our colleagues up and running remotely. Working remotely has been a real positive for us, and we want to make sure that we keep that sense of teamwork and collaboration that has
football competitions that proved pretty popular. We also used the time to work on our product development and made sure we were ready to restart with enhanced customer offerings. SBC: During lockdown, you supported William Hill’s £240 million bookbuild. Why did your executive leadership team require this gesture during unprecedented times? UB: The rationale was simple: we wanted to protect our ability to invest in growth, particularly in the US. The fact we were five-times oversubscribed showed there is strong external confidence in our business model. SBC: How important is it to monitor the competition during times of crisis? Or can you only make decisions based on your circumstances? UB: I think in a time of crisis, it is about staying very focused on your own business and strategy and customers, and colleagues. As I
THERE HAVE BEEN SOME CRITICAL MILESTONES IN OUR US GROWTH, INCLUDING OUR CBS DEAL, ENHANCED WORKING RELATIONSHIP WITH ELDORADO AND GETTING ACCESS TO SEVERAL NEW US STATES developed during this period. Our colleagues have also told us that generally, they have welcomed having more time to balance work and home life, and we are committed to ensuring we don’t lose that flexibility as we see a gradual return to offices. Of course, all live sports ended abruptly, and that was a big issue for our customers, and we had to be creative to find alternative products such as the darts at home [PDC Home Tour] and lesser-known international
talked about before, our strategic focus remained centred around customer, team, and execution. This focus didn’t change, and I believe it served us very well through the ‘crisis.’ That said, through our trade associations in the UK and elsewhere it was also important that we came together with our operators, where appropriate, to ensure that we were able
SPORTS BETTING
WE WANT TO MAKE SURE THAT WE KEEP THAT SENSE OF TEAMWORK AND COLLABORATION THAT HAS DEVELOPED DURING THIS PERIOD
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Customer, Team and Execution
SPORTS BETTING
to support customers through the unprecedented challenge of lockdown and acting responsibly and sensitively as an industry. In the UK, we collaborated with the BGC, signed up to the 10 COVID pledges, and participated in the temporary TV and radio advertising ban.
WE NEED A CLEAR AND CONSISTENT REGULATORY FRAMEWORK THAT IS FIT FOR THE 21ST CENTURY AND IT WILL BE GOOD TO HAVE A THOROUGH EVIDENCE-LED DEBATE SO WE CAN ALIGN AND MOVE ON
SBC: News recently broke that William Hill would be merging its UK retail and online divisions - what was the thinking behind this quite radical shake-up? UB: We see many upsides from this move. As always, our focus is on the customer, and I believe the new model will help us provide the best possible experience for our retail and online customers. The new combined division will also remove complexity and drive operational efficiency.
SBC: Competing against ‘new giants’, critics argue that its soft approach to M&A has hindered William Hill. What do you think about this narrative? Is William Hill, the last stand-alone brand in sports betting? UB: There are plenty of independent brands in our sector. I cannot comment on the business’ previous position on M&A. However, I am afraid I have to disagree with the assertion that it was a soft approach. We aren’t the biggest in our market, but we have a business of scale. In the US, we have a 24% market
SBC: Is digital the core focus for your new Malta hub? And post Brexit, how important is the two-hub set up to pushing growth both in the UK and internationally? UB: It was essential for us to have a non-UK hub, which we have established in Malta, and that has made us Brexit proof. However, we believe accountability must sit at the
22 SBC MAGAZINE • AUGUST 2020
country level in each of our territories.
IT WAS ESSENTIAL FOR US TO HAVE A NON-UK HUB, WHICH WE HAVE ESTABLISHED IN MALTA, AND THAT HAS MADE US BREXIT PROOF
share in sports betting and unrivalled market access across 24 states. Our stature in the US, combined with a best-in-class digital offering and a very experienced local team, means we are in a very advantageous position. SBC: And finally, what does the future hold for William Hill? Where will you be in five years? UB: I see a great many opportunities for William Hill. In the context of the UK, we welcome the forthcoming review of the Gambling Act. We need a clear and consistent regulatory framework that is fit for the 21st century and it will be good to have a thorough evidence-led debate so we can align and move on. We are one of the world’s biggest betting brands and we have an excellent opportunity to grow on an international scale. One thing I am sure of is there is much, much more to come. •
21-22 OCTOBER 2020 #BOSEDIGITAL
SHAPING THE FUTURE OF SPORTS BETTING IN EUROPE [ONLINE EDITION] 3,000
Delegates
120
Speakers
40
Exhibitors
Sports betting plans
JAY SNOWDEN: ‘WE’RE GOING TO LEAD WITH THE BARSTOOL BRAND’ THE COMING TOGETHER
of one of the biggest names in US gaming and arguably the edgiest brand in sports media was always going to create some serious talking points. Penn CEO Jay Snowden tells all
S
peaking at the inaugural SBC Digital Summit North America in July, Jay Snowden, President and CEO of Penn National Gaming, used his keynote address to cover significant industry ground, notably this year’s Barstool Sports acquisition, Penn’s longer term sports betting aspirations and how the sports betting sector per se will return to business post-Covid. Kicking off the conversation, Snowden took a glance back at how things unfolded at the time of the longawaited repeal of PASPA. “We had just announced that we were acquiring a competitor of ours, Pinnacle Entertainment, and were looking to close that transaction around the end of 2018,” responded Snowden. “But you fast forward to when that deal closed and we were going to be operating in 19 states across the country. “So when PASPA was overturned and sports betting became a state’s rights issue, we were the largest regional operator in the casino industry. This represented a transformational opportunity for the company.” He continued: “We knew the one thing that we were missing from a sports betting perspective at Penn was a brand to lead with and an audience to market to. We had great casino brands but our audience today
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WE’RE GOING TO LEAD WITH THE BARSTOOL BRAND FROM AN ONLINE SPORTS BETTING PERSPECTIVE tends to skew older - 45-plus - and the sports bettors tend to skew younger 21 to 45 - so that’s where we started to look at who we might want to partner with and of course we eventually bought Barstool.” On that particular topic, the question was posed to Snowden as to
how the Penn/Barstool relationship will shape up and what the combination of the two brands will look like in terms of physical locations both in terrestrial casinos and online. “We’re going to lead with the Barstool brand from an online sports betting perspective,” he responded. “We’re also in the process of converting our existing retail sportsbooks inside of our casinos and our sports bars to Barstool branded sportsbooks and sports bars.” The key question, added Snowden, was identifying how to activate that
US MARKET
Barstool audience with their brands and the personalities behind that brand. “I think one of the things you’ll find is that there’s going to be a lot of activity in our properties around those sportsbooks and sports bars.” Snowden was also pushed on what many observers would see as the coming together of two very different styles in the Penn/Barstool deal, especially given the latter’s perceived edgier approach with often controversial input from its founder Dave Portnoy. He commented: “We obviously spent a lot of time doing diligence on Barstool and we got very comfortable with making an investment in Barstool. Dave Portnoy and the folks at Barstool are a sort of meshing of Sports Center and Howard Stern and reality TV. It’s a sports media company, but at the end of the day these are entertainers. They create content - they’re comedians. “They’ve been at it for 17 years and everything he has said is on video for those last 17 years. I talk to Dave extensively about it and he’s said this publicly that times change. And he looks back at some of the things
WE KNEW THE ONE THING THAT WE WERE MISSING FROM A SPORTS BETTING PERSPECTIVE AT PENN WAS A BRAND TO LEAD WITH AND AN AUDIENCE TO MARKET TO
that he did or said in 2008 or 2011 or 2013 that if it were today he probably wouldn’t have said. “But the vast majority of the content they created is entertaining - they’re entertainers and comedians. I’ve yet to meet or listen to an entertainer or a comedian that thinks everything they said or did hit the mark when they did it.” •
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Opportunities in Canada
CANADIAN SPORTS BETTING IS A CASE OF WHEN NOT IF WITH JUST A CHOICE OF PARLAY sports bets or turning
to offshore suppliers, Canada’s sports bettors are faring less well than their counterparts across the US border. But that will change according to the boss of the country’s gaming trade body
C
anada’s long journey towards the introduction of regulated, single-event sports betting will ultimately prove successful, said Paul Burns, founder and CEO of the Canadian Gaming Association, during the recent SBC Digital Summit North America. Quite possibly spurred on by recent calls from the major sports leagues for a change in the law, Burns is upbeat on prospects for a fully legal sports wagering sector in Canada.
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The leagues’ missive, which was sent to Prime Minister Justin Trudeau, Finance Minister Bill Morneau and Attorney General of Canada and Justice Minister Dave Lametti, was signed by the NBA’s Adam Silver; NHL’s Gary Bettman; MLB’s Rob Manfred; MLS’s Don Garber; and the CFL’s Randy Ambrosie. Short and direct, the statement read: “The National Basketball Association, the National Hockey League, Major
League Baseball, Major League Soccer, and the Canadian Football League support an amendment to Canada’s federal laws that would authorize provinces to offer betting on single sporting events.” Addressing the conference, Burns updated delegates on the latest state of play, saying: “We have been working with a coalition of business, labor and community organizations, amateur sports groups and others who are for a regulated sports betting market. “We currently have another bill in front of parliament. We are in a unique situation due to COVID-19. And so we are waiting to see where that can go, but there is some movement. We are confident. We have all-party support. It is now a matter of when, not if.” During the session, Burns also laid out the case for why a new regulated
US MARKET
WE HAVE BEEN WORKING WITH A COALITION OF BUSINESS, LABOR AND COMMUNITY ORGANIZATIONS, AMATEUR SPORTS GROUPS AND OTHERS WHO ARE FOR A REGULATED SPORTS BETTING MARKET framework for single-event sports betting was so important. “Canada has had legal sports wagering for decades,” he explained. “We have had parlay wagering, as betting on the outcome of a single sporting event is currently illegal. But there is a real desire to see more. Canadians are speaking by accessing offshore online sportsbooks. “It has been customer demand. Above four billion dollars in gross handle goes through offshore online sports offerings. Because of Canada's grey market, Canadians are able to access rather convenient payment means for these sites. “Part of it is levelling the playing field for gaming operators, creating a legal framework to encompass all sports wagering, allow the regulated gaming industry in Canada to offer the products customers are looking for.” Also on the panel was Don Bourgeois, principal at Gaming & Regulation Group. He noted that a grey market has grown as a result of uncertainty surrounding the criminal code. “The criminal code is a very dated piece of legislation. The term grey market flows from that level of uncertainty as to what a private sector can do. The current language in the criminal code was really based upon land-based activity.” Both Bourgeois and Burns went on to explore opportunities in Canada for gaming businesses looking to establish a foothold in North America. Burns noted the strong pool of talent, particularly in Ontario, attractive tax credits and the ‘discount’ afforded by the Canadian dollar. “Ontario and other parts of Canada are a very good place to start into the North American marketplace,” added Bourgeois. •
Paul Burns, founder and CEO of the Canadian Gaming Association
THE CRIMINAL CODE IS A VERY DATED PIECE OF LEGISLATION. THE TERM GREY MARKET FLOWS FROM THAT LEVEL OF UNCERTAINTY AS TO WHAT A PRIVATE SECTOR CAN DO
Don Bourgeois, principal at Gaming & Regulation Group
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Transparency on and off the pitch
WHY INSTITUTIONAL MANAGEMENT IS NECESSARY FOR SOUTH AMERICAN FOOTBALL INTEGRITY HOW TO GUARANTEE THE INTEGRITY of sports
Graciela Garay, CONMEBOL’s Ethics and Compliance Officer
betting in Latin America was a key talking point at the inaugural SBC Digital Summit Latinoamérica, featuring expert insight from South American Football Confederation CONMEBOL
O
ne of the most important components of football competitions is the authenticity of the sport. Passion and interest depend on ensuring fairness in matches and indirectly this also increases sports betting activity, which is subject to these characteristics. The President of the South American Football Confederation (CONMEBOL) Alejandro Domínguez opened the track by sharing the authority’s objectives. “Since we first started in CONMEBOL four years ago, we set ourselves a main goal which is to believe big and promote the transformation and professionalization of South American football,” he said. “In this process honesty, transparency in management, and compliance with regulations were key to rebuilding the trust of the audience in this institution. “Thanks to this team of great professionals that work for the confederation, today we can say that we are moving in the right direction and that CONMEBOL is once again an institution that leads and drives the transformation of South
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WE’RE COMMITTED TO TRANSFERRING TRANSPARENCY AND ANTI-CORRUPTION TO THE PLAYING FIELD
American football with legitimacy and institutional credit recovered.” During the keynote, CONMEBOL’s Ethics and Compliance Officer Graciela Garay stressed that the administration’s starting point was the determination to give back to
LATAM MARKET
football what belongs to football. She explained: “We found ourselves in the need to start generating processes, policies, reversing cash payments and setting bank accounts in less than four months. That’s one of our historic measures.” One of the most important decisions in recent years, said Garay, was to establish strategic pillars, including the creation of the Integrity Department. She added: “Besides demonstrating transparency in all processes, we’re also committed to transferring that transparency and anti-corruption, which characterizes this term, to the playing field. This focuses on three sub-items: sports justice, economic justice and historical justice, taking fair play to all areas.” CONMEBOL Integrity Officer Julio Lansac highlighted the presence of integrity authorities in all Member Associations, and said that this inclusion results in the relationship and work being more effective, since it also allows them to have more control in all competitions, both on a continental and national level. To achieve the proposed goals, CONMEBOL set specific objectives,
including prevention measures and signed an agreement with Sportradar for all its services. This included monitoring the betting market, intelligence services for suspicious cases and a reporting channel on the confederation’s website.
IT’S ESSENTIAL TO HAVE CLEAR AND RIGID RULES THAT SUPPORT OUR GOALS AND THE CONCEPT OF INTEGRITY
Lansac said: “First, we were trained to understand the situation of what it means to take care of football from the manipulation of matches and to face challenges with concrete solutions. Knowing the reality in which organizations and people seek to rig matches to obtain illicit benefits through football, CONMEBOL, along with experts and professionals, has implemented training and seminars for Member Associations. “This requires each of them to appoint an integrity officer to address the matter at a national level, in
Julio Lansac, CONMEBOL's Integrity Officer
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Transparency on and off the pitch
LATAM MARKET
Alejandro Domínguez, President of CONMEBOL
direct control with CONMEBOL, to create ethical and upright behaviour. Thus, we maintain the principle of sportsmanships that characterises South American football.” CONMEBOL has the obligation to carry out integrity examinations in accordance with the parameters established by the statute and the governance regulations of FIFA. The members of the CONMEBOL Council, the president, general secretary and assistant general secretaries, and the candidates that aim to be part of the permanent commissions and judicial bodies must successfully pass an integrity examination carried out by the control subcommittee reporting to the Commission of Governance and Integrity.
Specific measures help maintain integrity in football Garay commented that in 2019, in-person training was carried out for a total of 593 people, including referees, delegates, match officials and executives. The topics centred on ethics, anti-corruption, conflict of interest, confidentiality and money laundering prevention. In this regard, the confederation has adopted a ‘zero tolerance’ policy
30 SBC MAGAZINE • AUGUST 2020
against individuals and organizations involved in match-fixing. “The threat to football’s integrity is real,” added Lansac. “Therefore, it’s essential for us to create awareness and communicate our principles to everyone involved in the sport. It’s essential to have clear and rigid rules that support our goals and the concept of integrity.
WE CAN CERTAINLY CONCLUDE THAT BAD OR GOOD SPORTS RESULTS ARE DIRECTLY RELATED TO INSTITUTIONAL MANAGEMENT. THE PITCH CANNOT BE SEPARATED FROM THE INSTITUTION “We know that the passion is generated by the uncertainty of what is going to happen. If the credibility and authenticity is questioned, the integrity is questioned and the reputation will be adversely affected, economically and in its essence. The consequence in sports is that the level of professionalisation of football will be affected, through its players. “And economically, sponsors won’t be interested in damaged products,
since television rights will also be affected. CONMEBOL is committed to promoting integrity in South American football, seeking transparency and fair play in everything the sport encompasses, and there is a zero tolerance policy against those that violate these principles.”
With a focus on integrity, CONMEBOL records higher revenues In 2013, CONMEBOL’s prizes totalled $59 million, while in 2018 that number tripled to $141 million. In 2020, the total club prizes are expected to jump to $217 million. To date, CONMEBOL has invested more than $53 million in development programmes. In terms of revenue, the confederation expects $509 million for the current year. In addition, Garay highlighted that CONMEBOL has received the Best Practices Award for Transparency and Integrity in the Private Sector from UNODC and the National Anticorruption Secretariat of Paraguay. She said: “With this, we can certainly conclude that bad or good sports results are directly related to institutional management. The pitch cannot be separated from the institution.” •
Football manipulation
FIFA: CLEAR SITUATIONS OF CORRUPTION AND MATCH-FIXING IN LATAM FIFA’S HEAD OF INTEGRITY ENNIO BOVOLENTA talked of the measures carried out by the international governing body for football to protect the competition and promote integrity and ethical behavior both in South America and worldwide
D
elivering the event keynote at the SBC Digital Summit Latinoamérica, Bovolenta discussed what integrity means to FIFA and how the organisation is focusing its efforts to guarantee the essence of the sport at all times. He also described the different ways in which the result of a competition can be affected, by action or omission, and said that the betting market is often involved. According to Bovolenta, manipulation in football is very serious
32 SBC MAGAZINE • AUGUST 2020
LATAM MARKET
since it eliminates “the most interesting and most important parts of the sport, its nature, which is what generates passion among fans”. He added: “In our experience, we’ve found cases where there’s sports and economic reasons, but both usually coexist - it can be one, the other or both. But the end result is always the same. In other words, football’s integrity is affected.” The FIFA official revealed that the governing body’s mission is to educate and prevent through programme
IN OUR EXPERIENCE, WE’VE FOUND CASES WHERE THERE’S SPORTS AND ECONOMIC REASONS, BUT BOTH USUALLY COEXIST - IT CAN BE ONE, THE OTHER OR BOTH promotions for players, clubs, referees and other interested parties before, during and after competitions. In order for prevention to be effective, FIFA separates its initiatives in two parts. It organizes events, workshops, seminars and virtual programmes, among other things. The second part consists of investigating suspicious activity. The
process ends when FIFA can determine if there was manipulation, in which case disciplinary committees are invited to initiate formal proceedings and, eventually, impose sanctions. To name a previous successful example, Bovolenta highlighted the Integrity Task Force that operated at the FIFA Women’s World Cup France 2019, adding that there was no
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Football manipulation
suspicious activity despite the volume of bets being 14 times greater than in Canada 2015. He continued: “FIFA cannot protect the integrity of all matches in all competitions around the world by its own. FIFA supports and recommends federations and confederations to act on integrity initiatives. We support those seeking to protect and promote the integrity of football. “Manipulation is a form of corruption, and in Latin America, as in other regions, you can clearly see situations of corruption and match-fixing. In the CONMEBOL region, we can surely find a significant risk, as in other parts of the world, where integrity alerts reported for irregularities can be verified. We receive them from the monitoring companies, in particular from Sportradar, which has a
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LATAM MARKET
collaboration agreement with us. “We also receive reports from other betting monitoring companies around the world. And manipulation may not be detectable by following sports betting, because the fact that we receive an alert doesn’t necessarily
FIFA CANNOT PROTECT THE INTEGRITY OF ALL MATCHES IN ALL COMPETITIONS AROUND THE WORLD BY ITS OWN mean that there was a problem. But it can be the starting point to find out if there was manipulation and, in some cases, start an investigation.” In addition, the Head of Integrity explained that FIFA cooperates with the confederations and with CONMEBOL to carry out initiatives to
protect integrity at a regional level, including the scrutiny of referees to guarantee that they have integrity, that they haven’t been involved in wrongdoings and that they’re ready to compete. He summarized his keynote by assuring that the goal is to create and maintain an efficient network of integrity officers. “FIFA has officers for each federation and confederation, which can be of help in case of an incident by creating report mechanisms on the FIFA site, in the app and other sites in which they can report anonymously.” Bovolenta concluded: “We act by supervising the betting market, protecting competitions through education and training programmes with empowerment plans, and with preliminary investigations and sections.” •
Human touch
RETAIL AND ONLINE GAMING’S RELATIONSHIP IN LATIN AMERICA THE SBC DIGITAL SUMMIT LATINOAMÉRICA discussed
regarding e-commerce, online transactions, is new for Latin America. Consumers are not just suspicious of online betting, but of any business that is only on the internet,” said Fernanda Sainz, CMO LatAm of the Mexican group Caliente Interactive. “It gives the player security to be able to speak face-to-face with the company. They like human contact, that there is someone who can assist them with any inconvenience.” While Latin American countries look at Colombia’s success to start implementing similar regulations, Germán Segura, CEO of BetPlay, the second licensed operator in the country, said that there is a strong division of online and retail operations under this legislation.
“How to market a sports brand in the changing regulatory landscape”
T
he top experts from Latin America have put their cards on the table, explaining that online gaming’s development in the region is virtually unfeasible without a relationship with the retail world. Betcris CEO JD Duarte started the panel, moderated by the Founder of iGaming Latam Consulting Juan Ignacio Juanena, by providing his experience as one of the best established operators in the continent. The lack of access to proper banking, education and trust regarding any online transaction and business, leads to an obstacle to the operation of an online platform when there is no physical space to support the brand’s recognition.
JD Duarte, Betcris CEO
THEY LIKE HUMAN CONTACT, THAT THERE IS SOMEONE WHO CAN ASSIST THEM WITH ANY INCONVENIENCE “The cost of having physical spaces is something to consider, but many times it is offset by the strengthened relationship with customers,” said Duarte. “Depending on the regulation of each jurisdiction, Betcris has rooms where players can bet, watch games and have a good time, while there are also only-purchase or express points where customers bet and make withdrawals or deposits.” The other speakers agreed that for the Latin American player, it’s important to see the brand in person beyond its online offering. “Everything
36 SBC MAGAZINE • AUGUST 2020
Juan Ignacio Juanena, Founder of iGaming Latam Consulting
80% OF THE BETS ARE MADE THROUGH MOBILE DEVICES, AND 20% THROUGH COMPUTERS It started with the fact that online gaming isn’t in direct competition with physical operations, but rather complements it. Despite the government adding new verticals that may overlap with physical offers, there’s still a sharp distinction between online and physical options. “80% of the bets are made through mobile devices and 20% through computers,” said Segura. On the other hand, he added that for retail sports betting “cash-in has succeeded” as it has simple and accessible points where players can deposit money, with the confidence that they can then bet it online. “The physical sportsbook in Colombia is still not used to this. You find some, but there isn’t much movement as in the casino,” Segura explained. In this aspect, all speakers agreed
LATAM MARKET
that it’s essential to be up-to-date with regulatory processes of each target market. The regulation is specific for every jurisdiction and demands compliance with precise details, so companies like Betcris had to open a compliance department to follow the rules of each region and establish a legal operation. “We self-regulate and try to apply best practices in all cases,” said Duarte. “You have to be flexible, agile. Each regulation asks for different
Fernanda Sainz, CMO LatAm of Caliente Interactive
A REGULATED ENVIRONMENT IS ALWAYS NEEDED FOR A BETTER INDUSTRY PERFORMANCE, FOR THE GOVERNMENT AND FOR USERS things and you have to be very aware and know the rules of the markets, which represents a great cost and concern.”
Germán Segura, CEO of BetPlay
In addition, Joaquín Gago, founder of the award-winning company BetandDeal, said that for an internationalisation strategy, it’s important that you go country by country, “taking into account the regulation of each place to adapt to the specific regulation”. He added: “A regulated environment is always needed for a better industry performance, for government and for users. Latin America is on that path and it’s time for us to join in to achieve it.” •
Joaquín Gago, founder of BetandDea
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Casino 2020
Getting back around the table
While the Hospitality and Leisure industry is slowly starting to return, it’s taking longer for land-based casinos to receive the government green light, and this continues to have an economic and social impact on the sector. From Las Vegas to London, Monte Carlo to Macau, casinos are ready and prepared to welcome back clients, but things will look and feel different.
The Hospitality and Leisure industry is predominantly a service industry and inviting employees back to work in land-based casinos has to be safe. Both employees and players want peace of mind that venues will have considered all Covid-19 health measures. An additional solution could be to provide Covid-19 testing. This would give casino owners the confidence that they are providing a safe and healthy environment for their clientele and employees to enjoy.
When you enter a casino, you can expect to see less people as capacity will be reduced to allow for adequate distancing. Gaming equipment will be cleaned frequently, and hand sanitiser will be available throughout the venue. Staff are likely to be wearing face coverings and you may see Plexiglas screens installed. This will become part of life as we know it as the rules of the game have changed.
TENTO WALLET™ is an International Digital Health Identification Wallet, with self sovereign identity. This means the individual has complete control over how their personal information is kept and used. COVI-PASS™ Gives the world the confidence to move forward.
www.covipass.com enquiries@covipass.com
A healthy pass to play on
Responsible gaming
COVI-PASS™ is a digital health pass embedded within TENTO WALLET™ that has been created to house a Covid-19 test result. You can share your negative test result from an app if it is asked of you. COVI-PASS™ is built on decentralised blockchain technology which makes it ultra-secure and solid on privacy. No one can see your information, unless you wish to share it. It’s just the test result that you are presenting. The pass can work alongside any other measures that a casino chooses to implement. It gives that extra assurance because a player knows that they are safe and everyone else in the room is safe too. This could be very attractive to land-based gambling venues to re-energise the buzz and excitement that this leisure activity creates.
Being able to share a negative Covid-19 test result helps with the fight against this disease because it means interacting with other people who are also Covid-19 free. A positive test result would mean taking responsibility for isolating, knowing that a test can be re-administered once recovered. Covid-19 will bring about a new way in how people integrate back into society. For the gaming industry, players are used to showing their ID when visiting venues, so for them, a shift in mindset to carry digital health data need not be such a game changer. As casinos around the world open their doors, it will be interesting to reflect on how and when clients will feel safe to return. Covid-19 has raised the stakes in health awareness and nobody wants to take any chances with this disease. People will start to
consider being tested for Covid-19 and solutions such as COVI-PASS offer a safe way in which to hold the test data. This secure digital health wallet could hit the jackpot in helping players return to having some fun again. To learn more about TENTO WALLET™ and the solutions available visit www.covipass.com or email enquiries@covipass.com By Harmen Brenninkmeijer, Quanta CEO
www.quanta.im
MALTA
Open for business
GAMING’S BEATING HEART’ DURING THE COVID-19 CRISIS, the Maltese business
community showed great resilience and determination - with gaming at the heart of the fightback
W
hen the word ‘coronavirus’ began dominating the global news agenda earlier this year, very few had any idea quite how much the emerging pandemic would affect day-to-day living, from seeing much-loved family members to going for a coffee with friends or attending an industry conference. Fast-forward six months and communities all around the world are still counting the mounting cost. Malta, one of the world’s smallest nations, but one of undeniable tenacity and resilience, appeared vulnerable. A strategic staging post sitting in the southern Mediterranean at the crossroads between Europe, North Africa and the Middle East, Malta remains a bustling intercontinental pitstop and vibrant destination in its own right. It is also one of the most densely populated islands in the world with a huge expat population that frequently travels far and wide. For the seemingly unstoppable COVID, it should’ve been low-hanging fruit. Gaming is one of the island’s critical
40 SBC MAGAZINE • AUGUST 2020
business sectors, in an economy also reliant on tourism, manufacturing, international trade and financial services. Indeed, thanks in part to the work of the Malta Gaming Authority, the island’s tier-one regulator and licensor, and the promotional work of agencies such as GamingMalta, the jurisdiction remains a keystone in online gaming’s global superstructure. When COVID struck and the borders closed, Malta battened down the hatches, held its breath - and its nerve - and rode out the storm, as it has many times before. Coronavirus has not been without consequence to the island nation but it is fair to say that, in extremely challenging circumstances,
WE HAVE ALWAYS FELT THE ISLAND WAS THE BEATING HEART OF THE IGAMING SECTOR AND THE RESILIENCE SHOWN IN THE FACE OF THE COVID-19 CHALLENGE HAS ONLY HIGHLIGHTED THAT
the indigenous Maltese and the vast international expat community has held firm, showing patience and grit. Determined to continue to do business and to bounce back once the brakes came off, Malta has attracted headlines in recent months for all the right reasons. So, as the COVID-19 threat very slowly recedes and a cautious optimism begins to return, where does Malta stand? Following his keynote address at CasinoBeats Malta Digital at the beginning of July, Ivan Filletti, chief operating officer of GamingMalta, spoke to SBC Magazine. Filletti feels that the world-view of Malta may well have changed as a result. “This extremely challenging period has revealed many strengths in the gaming community here,” he says. “We have always felt the island was the beating heart of the igaming sector and the resilience that has been shown in the face of the COVID-19 challenge has only highlighted that.” Like many around the world, in business and beyond, Filletti feels the coronavirus pandemic will likely lead to permanent, unforeseen change. “Indeed, the Malta gaming sector has come of age,” he explains. “As lockdown began, the sector’s business leaders stood up to be counted. We have seen countless donations to charitable foundations and homes
CASINO
Ivan Filletti, chief operating officer of GamingMalta
Kinga Warda, Head of Information at the Malta Gaming Authority
Clayton Bartolo, the Maltese government’s Parliamentary Secretary for Financial Services and Digital Economy
being made available to front-line workers, alongside many other acts of social responsibility. “But, beyond that, we have also witnessed the sector do its utmost to look after its most valuable asset people, both as employees but also as customers.” So has Malta emerged from under the clouds of corona to find itself in a better net position? One measure is the employment market. Do gaming professionals still see Malta as an exciting and attractive place to work?
CasinoBeats Malta Digital. “There are a lot of positions we have that are unique to the company. You don’t necessarily need a degree or diploma for a certain position. There’s not one specific qualification a person needs to be successful in gaming. “Of course, a CFO needs specific financial qualifications, but all the different skills in gaming make it difficult for an education system to be ‘gaming friendly’. What we really need is an education system that supports the transfer of skills.” Most do agree that a great number of businesses and sectors will have changed permanently thanks to COVID - many have had no option but to tear up the business plan and start over, often more than once. Filletti added: “As the coronavirus threat lingers, new business models for gaming’s future are being shaped. That blueprint must reflect what we have learned about the industry during the crisis and that includes the rise of esports, alongside an increased focus on a remote workplace culture and the sector’s reputation management.”
the sector,” he said, adding that Malta is looking to broaden its video-game development and esports sectors together. With regard to the gaming industry response to the COVID-19 crisis, Bartolo said: “The igaming industry has faced its own challenges during the coronavirus pandemic, but its innovative approach, nimble decision-making and great talent has sustained business models.
Kinga Warda, Head of Information at the Malta Gaming Authority, believes so and thinks that potential new recruits to the sector shouldn’t be deterred to entering the gaming industry as there are lots of gaming-specific skills that are impossible to obtain without onthe-job training. “There are many people out there who want to join the gaming industry – and those people need courses and workshops that can help them do that,” said Warda. “It’s good for graduates to join gaming companies and then try some roles out, to learn about the business. Gaming companies do offer more internships and we need to see more of those. The dialogue between industry and education should be open.” Omar Bitar, Senior HR Business Partner for The Stars Group, concurred. “Education does not equal competence.” he told delegates at
Clayton Bartolo, the Maltese government’s Parliamentary Secretary for Financial Services and Digital Economy, also highlighted the island’s fast-growing esports vertical during his opening remarks for the CasinoBeats Malta Digital event in July. “During this pandemic, we witnessed a rise in the popularity of esports. We are fully committed to strengthening
THE MALTESE GOVERNMENT LAUNCHED A FINANCIAL PACKAGE TO HELP MALTESE INDUSTRIES INCLUDING THE GAMING SECTOR THROUGH THE DEFERRAL OF TAXES AND GOVERNMENT AID He continued: “The Maltese government launched a financial package to help Maltese industries including the gaming sector through the deferral of taxes and government aid. Through these measures we reduced financial burden and, more importantly, we sustained our local workers. “Rather than a crisis, the post pandemic period will bring an opportunity to strengthen Malta’s igaming industry. The gaming sector will be crucial to pursue our vision in making Malta the home of gaming excellence. “Malta is open for business,” he concluded. “Be part of our project.” •
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Winds of change
JAPANESE CULTURE IS KEY TO UNLOCKING ONLINE GAMBLING SUCCESS PANELLISTS AT CASINOBEATS MALTA DIGITAL looked into
the future of online gambling in Japan and discussed ways in which it could unlock new avenues to gain a foothold into the restrictive market
J
apan is home to one of the most prominent economies in Asia, having also established itself as one of the powerhouses in the world economy. Yet one area which has, in recent times, been off limits is the online gambling market. Yet, is all this about to change? Japan is currently experiencing a rise in popularity of online gambling with figures on the number of people betting increasing on a daily basis. Currently, online casino gambling is illegal in Japan. However, the law is rarely enforced against gamblers or affiliates with the industry expectations for the Japanese gaming market beyond pachinko, lotteries and limited sports betting having grown over the years. Recently, the Osaka authorities were granted an extension to the date for submission of the proposal related to building of casino resorts in Osaka City - a clear demonstration of the growing support and open-minded attitude of the Japanese government in relation to the online gambling market. Yet not everyone wants to get involved in gambling in Japan,' noted Andrea Bellezza, vice president of EU and Asia pacific at KaFe Rocks, as he discussed the advertising restrictions across the country. As part of the Online Casino: Big in Japan panel at the recent CasinoBeats Malta Digital Summit, Bellezza discussed the current focus for operators when it comes to advertising in Japan, and highlighted prominent public concerns when it comes to gambling. He said: “There’s definitely a focus
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on SEO because the Japanese market for online casino is in a grey area at the moment. There’s no clear legislation, whether it’s legal or not, with many leaning towards not legal. SEO is definitely one of the best ways to bring users towards our partners and operators. “Advertising is very restricted and there’s difficulties in going out and doing advertising. Not everyone wants to get involved in gambling in Japan, it isn’t perceived as a good thing. So SEO is definitely one of the best ways to bring users. “Sometimes it is about connecting with the right person and convincing them that we are not breaking the law. “From what we have seen, many casino operator companies still go through the not so mainstream websites, so for example you see a
Andrea Bellezza, vice president of EU and Asia pacific at KaFe Rocks
lot more advertisements through porn websites.” Belleza was joined on the panel by Natalie Meyer, CEO and founder of Tokyoesque, Robin Reed, CEO of Ichiban Ventures, Michael Penn, executive editor of the AGB Nippon, and session moderator Andrew Gellatly, head of global research at Vixio. The panellists agreed that Japan boasts some of the global gaming industry’s most valuable players, with Bellezza expressing that although Japanese players may be more difficult to acquire, they are worth the ‘extra effort’. He said: “I can’t give specific numbers but I will tell you that for sure their lifetime value is higher than American players. These players are a lot harder to get and you have to put in more effort and more focus but it is definitely worth it because of the amount they spend. “This is a lot more than we are used to, especially in Europe. I would say it is one of the most high value players there is.” Echoing Bellezza’s claims, Reed
Natalie Meyer, CEO and founder of Tokyoesque
CASINO
EVEN MORE IMPORTANT IS THAT YOU’RE SHOWING THAT YOU ARE DOING SOMETHING WHICH IS JAPAN ONLY. IS IT A MASCOT CHARACTER YOU HAVE OR IS THERE A SPECIAL REASON YOU’RE IN THE JAPAN MARKET?
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Winds of change added that he had seen ‘lifetime value figures’ of up to ‘€2,000 per player’ from some of the Japanese market’s biggest competitors which he predicts will rise in the future. He added: “It’s only in the past four to five years that online casinos have really penetrated the market, so I think the numbers you’re seeing now are likely to go up.” Reed also claimed that Japan was a ‘total gambling market’ that has seen a 15 per cent compound growth rate in online casino, which he believes ‘hit the sweet spot’. He continued: “I think a lot of this growth is coming from the younger
CASINO that is, does your website differentiate itself from the other casino brands and localise itself? One of the things that I have noticed is that even the best of them have things that they can do better to retain their users. “There’s also another route to advertising which I haven’t seen many use and that’s influencer marketing but we have started using it for our clients. If you use it the right way of building a relationship with them and approach them in a trustworthy way then they are open to doing that.” Meyer highlighted that the ‘number one thing’ for operators is to express their dedication to the Japanese
noted that it wouldn’t be until 2027 when one of the first will open its doors. Penn pointed out that there has been a ‘strong shift in the winds’ in terms of digitisation in Japanese society as a whole which could ‘overflow’ into the gambling market. He said: “I think the Japanese society, which has been very resistant to moving into this digital world, will now make this shift at a surprising speed in the next couple of years and I think that it would have an overflowing effect into the gambling market as well. “I would be shocked if the Japanese government’s overall legislative
Michael Penn, executive editor of the AGB Nippon
Robin Reed, CEO of Ichiban Ventures,
generation who are looking for a different experience than the traditional Pachinko content.” With regards to the growth in online gambling, Penn highlighted his own experience while currently living in Japan. He noted: “In the course of my coverage I am scanning through Japanese language websites and find various gambling ads that appear to be advertising various online gaming and gambling sites and it’s becoming an increasingly common sort of thing. “I do believe that the advertising is getting out there and for those that are going to the more popular culture sites it’s now quite a normal thing.” Meyer stated that operators need to show the Japanese community that they have thought about the market and considered ways that they can ‘localise’ their product offering. She emphasised: “One thing to add to that is how to attract users and how to obtain them and a big factor to
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Andrew Gellatly, head of global research at Vixio
I WOULD BE SHOCKED IF THE JAPANESE GOVERNMENT’S OVERALL LEGISLATIVE FRAMEWORK CHANGES ANYTIME SOON WHEN IT COMES TO ONLINE GAMBLING GAMING. IT’S REALLY AN ISSUE THAT POLITICIANS DON’T WANT TO TOUCH market to the customer which she said is exemplified through ‘attention to detail such as the privacy policy and terms and agreement’ being translated into Japanese. She continued: “Even more important is that you’re showing that you are doing something which is Japan only. Is it a mascot character you have or is there a special reason you’re in the Japan market? Something which shows you have taken the time to deal with what Japanese design expectations are and delved into that and then localise your website that can be appealing to the Japanese perspective.” In regards to the opening of integrated resorts in Japan, Penn
framework changes anytime soon when it comes to online gambling gaming. It’s really an issue that politicians don’t want to touch.” Meyer concluded: “You can’t really underestimate the power of the trend in Japan. If you have five to six years to build up to an integrated resort in Japan you have the time, hopefully, to ease into it and help the public see it’s not so scary and that there’s interesting aspects to it as well. “I think once that happens then all the early players who are now on online casinos can at least get that early loyalty from the Japanese consumers and then that’s going to spread like wildfire.” •
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Digitalising the iGaming industry.
Poker renaissance
SUSTAINABLE SURGE? EXAMINING THE RECENT POKER BOOM POKER IS JUST ONE OF THE MANY ONLINE VERTICALS to have enjoyed a
significant uptick in activity recently. But having been lauded for its resurgence in certain quarters, where exactly is poker’s place in the gaming ecosystem?
46 SBC MAGAZINE • AUGUST 2020
CASINO
Manuel Lopes, CEO of Pokio/Qufan Technology
at CasinoBeats Malta Digital. “But it’s been nice to see the resurgence since the start of March.” Lam was joined on the Juicy Stakes sponsored session by Manuel Lopes, CEO of Pokio/Qufan Technology, who in past discussions has documented his own vision for poker in some detail. Other key contributors on the day were Eoin Kennedy, director of marketing of Run It Once Poker, and Sergii Romanenko, COO of Pokerok, with Ivonne Montealegre, event director of Malta Poker Festival, taking the moderating reins.
D
uring recent weeks and months the scrutiny on the online gaming and betting sectors has been growing by the day, with a much documented lack of sporting action seeing punters turn to a variety of online verticals to fill that sports betting void. Numerous topics and themes have been discussed, and discussed and discussed, many of which fell under the spotlight during SBC’s recent trio of digital conference offerings focusing on online casinos as well as the LatAm and North American regions.
Poker is one vertical in particular which has witnessed a resurgence in recent times, with the heightened activity often lauded as a renaissance in some quarters, but question marks over its continuance, particularly as global sports begin behind closed doors returns. “I think it’s been really interesting to see, obviously you referred to Chris Moneymaker over a decade ago where we had the poker boom, which was really interesting,” said Phil Lam, head of gaming of Betsson, speaking
Among the numerous avenues of discussion ventured down on the day was poker’s rightful place in the modern igaming ecosystem? How can the vertical aim to cement its place as online gaming’s reliable bedrock? And could slot players happy taking their chances with RNG gaming be encouraged to play more poker? “It was obviously very noticeable, we received a big increase in activity. In our case poker is our only product, so it had an even bigger impact on the business,” Lopes continued as attention was firmly placed on the recent growth of activity brought on, in part, by the health crisis. “Now it’s all about finding a way to keep those players engaged and to really tailor to them to keep them engaged and to play on the platform. “So, I think on one hand we have to be really careful during this time because there were a lot of guidelines from the regulators on what you can push or not during this pandemic, and we’re totally on board with that. So it’s more of a long-term strategy to keep
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Poker renaissance
CASINO
those recent and reactivated users engaged.” Adding in conversation with CasinoBeats: “Indeed, online Poker experienced a recent boom across the board during the lockdown. This noticeable increase was expected and in many cases surpassed expectations. Whether or not the surge is sustainable is a great question. “It all depends on what efforts were made to retain those new users or returning users and make sure they stay loyal to the platform. Regulators like the MGA and others made sure
quite sure if it will reach the levels of a decade ago, but from a Betsson perspective we have a firm, strong appetite and a dedicated focus to really try and scale and grow poker moving forward. “We’ve recently gone through what could potentially be explained as the biggest poker migration that we’ve seen for quite some time, so from a Betsson perspective we’ve been really focused on that for the past couple of months.” Brought on by the closure of the Microgaming Poker Network earlier in the year, Betsson became just one of a
that users were protected during that lockdown period and there was no attempt by operators to overly push these users to play and take advantage of the forced lockdown.
SPORTS ARE AN ESSENTIAL PART OF THE INDUSTRY AND WE WELCOME THE RESUMPTION OF SPORTING EVENTS. WE DON’T SEE SPORTS BETTING AS A THREAT
“We embraced those rules and went with a long term approach that makes sure the users will play in our platform for its own virtues instead of a forced situation that neither the players or us can control. We’ve also doubled our efforts in terms of responsible gaming, knowing that in times of crisis players are much more vulnerable.” With the impact of COVID across the panel acknowledged as having been quite beneficial, or at least not detrimental, Lam continued: “I’m not
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number of igaming incumbents to make the move to Playtech’s iPoker network. Lam asserted “we’re pretty much close to pre-COVID levels” amid confidence that “it will definitely put us in a good position long-term”. Continuing on the migration theme, involving eight brands in 12 jurisdictions, Lam remained confident
of scaling up and giving poker “the attention it deserves”. Adding: “We will definitely be looking to have a much more dedicated focus for poker and it will form part of our strategy for cross-sell and acquisition.” Lopes, however, had this to say when examining what could be done to ensure a significant drop-off isn’t felt in the face of such resumptions: “A slow down is natural at this stage as users have a lot more choice again particularly with sporting events,” he said. “However we have invested significantly in partnering up with live events in our own vertical by testing new cooperation models, hybrid event structures and original promotions that cross over to the realm of live play. Fortunately for us we are also a fully mobile product so our users can get the full Pokio experience even when attending live events and on the move. “Sports are an essential part of the industry and we welcome the resumption of sporting events. We don’t see sports betting as a threat, in fact we don’t think that it was a major factor neither in the surge of online poker during the lockdown or in a potential slowdown after.” On the current place of poker in the igaming ecosystem, Lopes was full of praise for the vertical: He shared: “I think that poker has a very special place in the ecosystem, first of all because it’s a social game in its nature. And it’s a game that people have a passion for, you don’t really hear two casino players, two online casino players, three years after discussing a spin that they had at an online casino.” Adding: “It’s a game of passion, and people who play poker feel it in a very special way. I think that’s also an advantage for us, the operators. If we can give the players what the players want.” With the importance of social interaction continually praised, and even the potential usage of webcams rearing its head, a mobile shift is seen as crucial in the current climate. As new product features, quick burst tournaments and marketing tools were identified, the importance to continue on the track of mobile was deemed essential. After all, as Lam suggests, “no one really wants to play on an MTT for four hours on an iPhone”. •
Aggregator back in fashion
CONTENT IS STILL KING - BUT WE NEED TO KEEP INNOVATING WRITING FOR SBC MAGAZINE, Hub88.io director Vladimir
Negine discusses how content aggregation must adapt to a fast-changing online casino sector and deliver on its promise to streamline and optimise
T
he past decade or so has been a golden age of casino content. Innovative games developers are now delivering worldclass content at an astonishing rate. Players have never had so much choice as studios compete to be the next to score a blockbuster. While this is undoubtedly a positive
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thing, it has presented challenges when it comes to delivering this content to the player. More games mean packed integration roadmaps; additional functionality and back-office features mean these integrations are more time consuming than ever. It is a catch-22 for casino operators who need to match competitors on the
content front, but cannot necessarily afford to take on an additional technical burden. At the same time, casino players are savvier than ever. They expect the new slot from their favourite supplier to be available immediately. And if it isn’t, they’ll leave to find somewhere else they can play it. This new reality has meant the content aggregator is very much back in fashion. There was a time when operators determined that it was best for them to handle all integrations themselves; today, most appreciate that this is a job best left to the experts. But for content aggregation to continue to add value, we must find ways to better serve both the needs of players and operators, streamlining and optimising processes so content can really shine.
What it means to be flexible The challenges the online gaming industry has faced over the past few months could not have been predicted. But the gambling industry, perhaps more than any other, should have been well placed to understand the threat
CASINO
WE’VE BUILT SOMETHING THAT MEETS NEEDS AND SOLVES PROBLEMS BY REMOVING MUCH OF THE MANUAL WORK WHICH CREATES BOTHERSOME OPERATIONAL OVERHEADS
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Aggregator back in fashion
posed by a black swan event. For many years, operators and suppliers alike have preached the importance of agility and a flexible approach to everything from product to customer service. And arguably the global lockdown brought about by the COVID-19 pandemic provided the first real opportunity to show that these were not empty words. Suddenly operators were faced with unique circumstances, including an almost total lockdown of elite level sport.
Products needed to adapt, and fast. Many of our partner operators needed to quickly alter their offerings. With no sport available, virtuals suddenly took on greater importance. Where live tennis may once have been streamed, now live dealer casino needed to fill the gap. And all these decisions had to be backed by smart analytics which could help guide operators through these most challenging of times. It was a chance for content aggregation to shine, but only if it could deliver what was promised. Fortunately for us at Hub88, our product rose to the challenge. The integrated approach we have taken, which includes full customisation for operators and a market-leading back-office, meant our partners were able to react in real-time to the everchanging circumstances.
Different beginnings We’ve been able to take a slightly different approach to content aggregation than many in this industry, in large part because of the way we entered the space. Hub88 did not spend years in the boardroom as an idea looking for investment; instead, it was the product of a Coingaming Group hackathon, with a rough version built within a few weeks. Rather than focusing on building a product, our team simply wanted to solve a problem: namely, finding a way to streamline our game integration roadmap. The Hub88 origin story has been important for several reasons. Firstly, it means we are not simply another content aggregator looking to grab market share in an already
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CASINO
OUR PRODUCT IS VERY MUCH DESIGNED WITH AN OPERATOR’S REAL-WORLD CHALLENGES IN MIND crowded industry. But perhaps more importantly, it means that our product is very much designed with an operator’s real-world challenges in mind. Hub88 was built by an operator, to make an operator’s life easier; it is supported by a team which understands these daily challenges. We are not in the business of delivering abstract solutions; we’ve
built something that meets needs and solves problems by removing much of the manual work which creates bothersome operational overheads.
Behind the scenes While content aggregation is all about showcasing the very best in casino games, the real magic happens behind the scenes. For a few years now, beating your competition in terms of content offering is no longer enough. Instead, operators require a diverse set of analytical and business intelligence tools to ensure they can personalise and optimise their product. This takes several forms. For casino managers, we’ve focused on building a back office which is not only the most comprehensive on the market, but also presents data in an intuitive manner.
We quickly found that bombarding casino managers with huge volumes of data was not productive. Without an easy way to digest this data into actionable insights, it was of little use. So we have invested heavily in prebuilt segments and filters, while also handing over the keys to operators so they can design and customise their own. There are other back-office considerations, as well. Many of the leading slots suppliers are now providing their content alongside powerful promotional and bonusing tools. We’ve worked hard to unify this bonus and free spin functionality, so operators can offer joined up
promotions which makes sense to their customers.
The future of content Ultimately, content is the lifeblood of the online casino industry. We need to remember that we are competing with a broad range of entertainment for the eyeball hours of our users. If the content cannot engage when placed next to Netflix, Facebook or Steam, then we are fighting a losing battle. And as content aggregators, our job is to ensure that the world class content which is being published by studios around the world reaches the player. Finding new ways to optimise and streamline this process is arguably the most important challenge our industry faces today.
Lasting US footprint
NO WAITING GAME: LIGHTNING BOX SET FOR PAN-AMERICAN CONTENT ROLLOUT DAVID LITTLE OUTLINES THE SUPPLIER’S PLANS across the
pond, including why it must be regulation ready as the starting gun fires in states across the US
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CASINO
T
he United States has become a key component of the igaming environment over the years, with suppliers and operators alike continuing in their attempts to reap the rewards of the many opportunities presented across ‘the land of the free’. One such example of a concerted effort to achieve significant growth across the nation comes the way of Lightning Box, with the Sydney, Australia headquartered supplier having started life in the US 16 years ago. Numerous moves have been made by the developer, where regulations allow, however attention is also focused north of the border where link-ups have been unveiled alongside Loto-Québec and the British Columbia Lottery Corporation during recent months. Holding such a long affinity with the US market, David Little, co-founder of Lightning Box, examines what about the country has ensured that the igaming supplier has retained such an interest in the region: “The US is where Lightning Box started in 2004 as an exclusive supplier to IGT when landbased casinos were the only show in town,” he says. “Both my fellow co-founder and I worked for Aristocrat and IGT. We lived there for a time and created games in situ, so we have a good idea about what makes a US player tick. “Our style of gameplay has great resonance among those players. So much so in fact, that we were able to diversify into social gaming when the opportunity arose. Now that online is in full swing in a number of states that is the final piece of the jigsaw. “We’ve established a successful presence in New Jersey with brands like Golden Nugget, Borgata, Harrah’s, Mohegan Sun, Sugar House, Resorts and Hard Rock via our distribution deal with SG Digital. We’re excited about Pennsylvania and Michigan now. The trick is giving players what they want, not just what you happen to have because it may have been successful somewhere else.” As further regions begin to open up to the possibilities of igaming, with new states either taking the plunge or looking to do so in the future,
THE US IS WHERE LIGHTNING BOX STARTED IN 2004 AS AN EXCLUSIVE SUPPLIER TO IGT WHEN LAND-BASED CASINOS WERE THE ONLY SHOW IN TOWN many more online casino incumbents are beginning to outline and enact expansion strategies targeting players across the vast area. “Our aim is to distribute content to operators in every regulated state as it opens up in the US,” Little adds on Lightning Box’s current and future ambitions concerning the country.
“We’re working with SG Digital to ensure we’re ready to release content when the starting gun fires. It’s a competitive market so we don’t want to be hanging around waiting. “We’re also in touch with Gaming Labs International to understand the requirements as they get approved for each state. We want to ensure we leave a lasting footprint in the US igaming market as we have done in land-based and social gaming.
OUR AIM IS TO DISTRIBUTE CONTENT TO OPERATORS IN EVERY REGULATED STATE AS IT OPENS UP IN THE US
“There are also developments afoot in the land-based sector, where we have existing deals with Everi and Incredible Technologies to supply games to their cabinets. We have some exciting news in the pipeline to announce a deal with another important supplier too, so watch this space.” Many are well versed with the current hotbeds of igaming action in the US, but with such a large scale of potential entrants into the online casino space in the near or long-term future, the necessity to ensure that expansion strategies target those key regions will be crucial.
“Michigan looks like it is going to be a really important online market,” said Little. “That’s not just for its potential size, but the fact that it will be the first tribal market we are to see go live. Should this go well then it could be the watershed moment for other Indian tribes to move towards online gaming. “A successful case study would allow us to put pay to their understandable fears of it adversely impacting their retail casinos. As we’ve seen working across multiple channels, they are complementary not cannibalistic when done right. “Obviously, Pennsylvania has great potential too. I think you will see regulation speed up in a number of states in the next two years. There is
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Lasting US footprint
now an appreciation that players want it and the powers that be realise that it could be an important source of tax revenues for them.” As previously alluded to though, Lightning Box has not placed all of its North American eggs in the US’ basket. Attention has also focused on neighbouring Canada, with the potential of the market causing great excitement among many. Earlier in the year, Peter Causley, Little’s fellow Lightning Box cofounder and CEO of the developer, lauded an “another important step” made in the growing the business reach when detailing the aforementioned BCLC link-up. “Canada has huge potential,” continued Little. “It is obviously not quite as populous as its southern neighbour, but like their counterparts in Australia and the UK, Canadians love to have a wager or play in the casino.
LIKE THEIR COUNTERPARTS IN AUSTRALIA AND THE UK, CANADIANS LOVE TO HAVE A WAGER OR PLAY IN THE CASINO
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CASINO
“We’ve already established an important footprint with Loto Quebec and the British Columbia Lottery Corporation. But there are new territories including Ontario and Alberta and operators like the Atlantic Lottery Corporation that are displaying very positive signs. “We’re likely to see more provincial state-run igaming markets open up across the country and it is a very exciting time to be involved. The great thing about Canada for operators and suppliers alike is that it is well regulated too. That combination of decent regulation and an enthusiastic audience is not something any of us wanted to miss out on.” Localisation has very much become a buzzword where expansion strategies are concerned. In fact, the need to ensure content meets the specific needs of players within target jurisdictions has arguably never been greater. With that in mind, how do player preferences differ between the USA and Canada? And how key will tailoring content to meet specific needs be moving forward? That’s a good question and an important one,” Little replies. “We feel Americans love the old school video
CANADIAN TASTES IN SLOTS CAN VARY BUT THEY’RE FAIRLY SIMILAR TO THE AMERICANS IN THAT THEY LIKE THOSE CLASSIC STYLES slots and we like to think that we do them particularly well, adding a twist of innovation. “Canadian tastes in slots can vary but they’re fairly similar to the Americans in that they like those classic styles. Our focus is to continue to provide high quality and fun slots that engage players and keep them coming back for more. “We want to ensure our games can also be easily understood by players as that is a key in bringing them back. If they have to consult the rules every five minutes you’ve failed. At the risk of sounding patronising, it’s also important that products are selfexplanatory, particularly when new players are coming in. “We don’t feel it is necessary to tailor content towards a specific market too much, especially ones like the US and Canada, which are very similar. It’s all about creating the best slot range possible, so there is something for everyone to enjoy.” •
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Consumer shift
IS RETAIL BETTING ON THE CUSP OF A NEW CASHLESS NORMAL? BETTING SHOPS AND CASINOS FACE SIGNIFICANT CHALLENGES in adapting
to the ‘new normal’ brought about by COVID-19. But as so many sectors go ‘cashless’ to avoid the unnecessary handling of money, what does that look like for the gambling industry?
T
he decrease in the usage of cash and the subsequent spike in digital transactions is an issue that has become increasingly prevalent throughout the coronavirus pandemic. It’s a subject that has encompassed the agendas of most sectors, but has been very much on the forefront of the reopening and reemergence of retail betting given the elevated amount of cash handling that goes on within transactions. As part of PaymentExpert’s panel on ‘Cashless – The New Normal’ at the recent CasinoBeats Malta Digital Summit, industry leaders came together to unanimously underline their belief that the COVID-19 has served to enhance innovation around cashless technology dynamics. David Williams, Director of Public Affairs Rank Group, stated: “For my friends of the gambling parish, we
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David Williams, Director of Public Affairs Rank Group
have to face up to the fact that this phenomenon is happening now. Looking at my wallet, I’m still carrying the £10 note from March. “Just by way of illustration, I can’t think of a time when that has ever happened. There is no doubt that even beyond the gambling industry, society has found itself embracing a cashless world. “Who knows it might be because of government guidance on public safety that they encourage the use of contactless payments where possible. But I think that as a society, we have to
adapt to that. We must acknowledge that old habits have been broken people are carrying cash around less often. “When we think about reopening our casinos, we have to respond to consumer trends and consumer behaviours. We didn’t invite this trend, it was almost thrust upon us by virtue of the most extraordinary few months. We have to face this new reality, and embrace the changes to customer demand for cashless payments.” Having worked on cashless concepts
PAYMENTS
THERE IS NO DOUBT THAT EVEN BEYOND THE GAMBLING INDUSTRY, SOCIETY HAS FOUND ITSELF EMBRACING A CASHLESS WORLD
and products for the past 18 months, Samuel Barrett, Director of Gaming at Trustly, detailed his belief that gambling has a strong grasp on its consumer adoption but has yet to recognise the true benefits of cashless environments. He explained: “The term ‘cashless’ doesn’t necessarily mean that venues,
establishments and retail need to operate entirely without cash. It refers to players being able to walk into an establishment without cash and still being able to make a deposit. Before COVID, consumer behaviour was definitely shifting towards cashless. “Clearly as a result of safety precautions which has removed the
CASHLESS IS DEFINITELY MORE AT THE FOREFRONT OF A RETAILER’S MIND DUE TO THE PANDEMIC, BUT IT WAS ALREADY A NECESSITY PRIOR TO THIS
need for cash, cashless environments have become more of a priority. Cashless is definitely more at the forefront of a retailer’s mind due to the pandemic, but it was already a necessity prior to this. “I think the reason for that is because digitalising retail establishments offers a heap of valueadds for the player but also for the operator in terms of AML, responsible gambling, operational efficiency and operational cost perspective. “There is an enormous amount of untapped opportunities for both
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Consumer shift
WE WANT TO GIVE OUR PUNTERS THE APPROPRIATE LEVEL OF COMFORT WHEN IT COMES TO SOCIAL DISTANCING AND HYGIENE. CASHLESS AND DIGITAL PAYMENTS DEFINITELY HAVE A ROLE TO PLAY
PAYMENTS
Samuel Barrett, Director of Gaming at Trustly
businesses and players by shifting towards cashless. If we scale back there are many operational costs attached to handling cash transactions. If operators can cannibalise those costs towards acquiring customers through new technologies, cashless benefits become multi-dimensional…. this is the big bet for payment technologies.” Martin Lycka, Director of Regulatory Affairs at GVC Holdings, highlighted that both betting shops and casinos must ensure that they achieve a balance between implementing new cashless payment methods and player responsibility when it comes to imposing payment limits. He said: “This is part of the move towards customer trust. So we’re moving away from casinos, whose use is largely similar to betting shops I imagine. Indeed, we want to give our punters the appropriate level of comfort when it comes to social distancing and hygiene - and when it comes to cashless and digital payments, they definitely have a role to play. “It is easier for them to affect those types of transactions. By implication, that may mean that some customers may not feel comfortable spending as much time as they usually would in the betting shops. “To give a US-related example, there’s a huge ongoing debate surrounding gambling and cashless payments in the US, how to implement this in a safe way, and the benefits that this could have. As always, there are two sides to this argument. “There’s one side that is business driven, almost gung-ho when it comes to pushing for the introduction of nearly limitless cashless limits. But on the other hand, there are responsible gambling organisations which have voiced their concerns over limits. The regulators stand in between who - for
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obvious reasons - might be scrambling towards introducing appropriate regulation to reflect all the changes of late. We need to find a middle ground.” In addition to the tensions regarding customer safety and responsibility, Lycka warned of potential regulatory frictions caused by technology advancements. As the UK government is ordered to overhaul the nation’s gambling laws, Lycka envisions regulatory and policy advisors focusing on cashless rules in relation to monitoring transactions, consumer safety and compliance procedures.
Martin Lycka, Director of Regulatory Affairs at GVC Holdings
He detailed: “We now know that we are going to go through a regulatory revamp. Therefore, cashless engagements and procedures will be reflected in the future regulatory make-up of all types of gambling services. “We don’t want to have a scenario where a group of cash-carrying customers are alienated. For betting operators, it will come down to the familiar scenario of how they serve the customers and whether they can offer a safe environment in which to gamble.” Changing regulatory demands will be at the forefront of the cashless take-up by betting companies and casinos, but as David Williams bluntly concluded: “Fundamentally we have to look at this through a customer-centric lens… This is what they expect, this is what they want. As we have seen in other leisure industries, if you don’t provide adequate provisions they will spend elsewhere… Take note because it's as simple as that.” •
AS WE HAVE SEEN IN OTHER LEISURE INDUSTRIES, IF YOU DON’T PROVIDE ADEQUATE PROVISIONS CUSTOMERS WILL SPEND ELSEWHERE. IT'S AS SIMPLE AS THAT
Culture change
TO CHANGE THE CULTURE, IT’S NECESSARY FOR THE USER TO HAVE AS LITTLE FRICTION AS POSSIBLE
Mikael Lijtenstein, AstroPay CEO
THINKING LIKE THE CUSTOMER TO ACCELERATE CASHLESS SHIFT CASHLESS PAYMENTS ARE HERE TO STAY, said AstroPay
CEO Mikael Lijtenstein, who believes the shift towards it has been accelerated by the COVID-19 pandemic
S
peaking on the ‘’Cashless future? Solving LatAm’s payments problem’ panel at the SBC Digital Summit Latinoamérica, Lijtenstein led the debate on a lack of payment options in emerging markets such as Latin America (LatAm) and Africa, and the level of opportunity for digital payments in these regions. Does the pandemic represent a business opportunity for digital payment products? Or is it an exaggeration, and everything will
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return to normal once the crisis is over? For Lijtenstein, the shift to digital, or cashless, payment solutions was always going to happen anyway, but now companies can no longer afford to wait. “It represents a moment where companies say I am not going to wait for this to happen,” he said. “Why wait to improve my business, to improve my revenue, to improve what I’m doing, to go out and diversify and accelerate everything that was supposed to happen in a year, in two years, five
years or 10 years, when I can make it happen as quickly as possible?” AstroPay started in the Brazil market back in 2009 through local payment methods across the country. The experience gained in the last 11 years, said Lijtenstein, has allowed it to expand in LatAm, Africa, Asia and several other regions. He explained: “This makes us look back and see everything that has happened, this whole process of the disappearance of cash payments and the move towards cashless.” Lijtenstein admitted that the lack of understanding for digital payment solutions has been holding back the acceptance across South America, but added: “To change the culture, it’s necessary for the user to have as little friction as possible when buying a prepaid card, for the experience to be as simple as possible, useful and something common to the consumer. “We now go hand in hand with it (cashless). In fact, for some countries we already have only cashless solutions. That’s the path we’re currently on.” AstroPay’s plans for 2020 include taking its AstroPay Card to Africa in countries such as Nigeria and Kenya, for both gambling and other online transactions.
PAYMENTS
“You have to activate ‘turbo charge’ and say ‘let’s make this happen as soon as possible,” said Lijtenstein of new market opportunities. “We asked our teams to think about how to speed up each of the processes that were going to take place, and make it happen now when the opportunity is clear.” One of Lijtenstein’s fellow panelists was Elizabeth Maya Cano, President of Cornazar, who highlighted data from 2018 showing that only 24% of LatAm consumers used non-physical payments - that’s around two in 10 using card or digital payment solutions. So, what is the next step? How do you make this more normalised? The key is to think like the customer, according to Lijtenstein. He said: “User experience is not limited to what they go through when they enter the application and they register, it’s not just when they’re going to make a deposit, or when they’re going to make a purchase. “User experience happens all the time they’re in touch with something related to the product or service, so when they’re talking to support, when they receive an email, when they want to make a transfer, when they want to change their email or phone number.
launched a help center tool where, once the user solves their problem, they have the option to answer whether the help was good or not, and if the product is useful or not. If it is, it’s important to build from that and, if it’s not, it’s necessary to rethink the process to facilitate the experience. Lijtenstein explained: “We use A/B testing a lot, and we test different communications, which is key for the user experience. However simple or complex the solutions may be, if what we’re communicating is understood, the user will be attracted or will say ‘this is what I’m looking for, this is what I want and this is what I like’. “Sometimes you have to be a little more rigorous with the information, you have to ask what you consider
YOU MUST THINK LIKE THE CUSTOMER TO CREATE THE BEST PRODUCT, PROVIDE THE BEST SERVICE AND TAKE CONSTANT FEEDBACK TO CONTINUE IMPROVING relevant and necessary, instead of asking for unnecessary things. However, we still have to comply with requirements around technological processes, with regulations, and with what the world asks of you. “It’s important to think like the user to create the best product, provide the best service and be able to receive constant feedback in order to continue improving.” •
Elizabeth Maya Cano, President of Cornazar
WHATEVER THEY DO WITH THE PLATFORM, AND ON WHATEVER DEVICE THEY ARE DOING SO, THAT’S USER EXPERIENCE “Whatever they do with the platform, and on whatever device they are doing so, that’s user experience. What we’re looking for is that this experience is frictionless, that it’s easy, simple and fast and as natural as possible for the user. It’s important to understand how the user thinks, and sometimes less is more. You don’t have to think too much, you don’t have to come up with the most difficult solution or do something complex.” In addition, Uruguay-based Lijtenstein explained the importance of getting regular feedback from clients to understand what consumers like, or don’t like, about the solution. As part of an initiative to improve user experience, AstroPay recently
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Spreading the risk
AFFILIATES: DIVERSIFICATION THE BEST RESPONSE TO REGULATORY CHANGE PANELLISTS AT CASINOBEATS MALTA DIGITAL discussed some of the pot-holes affiliates may stumble upon in terms of compliance, and highlighted the importance of diversification and authority when it comes to maintaining operator relations
C
ompliance has been a topic at the top of the agenda for many in the gaming industry, and with political entities proposing further measures to ensure regulatory compliance for UK affiliates, an understanding of the intricacies of compliance is now more important than ever for those looking to avoid the repercussions. One of the ways in which affiliates can become less vulnerable to regulatory change is through diversification, according to panellists at the recent CasinoBeats Malta Digital. Speaking as part of the Affiliates: Navigating the Compliance Minefield panel, which was sponsored by Safe Affiliate Programs, Ian Sims, founder of affiliate compliance specialist Rightlander, advised affiliates to spread their risk across multiple operators and markets. He said: “Spreading the risk across markets is important for affiliates. A couple of operators recently pulled out of the UK because of compliance issues, which means that every affiliate in that market for those operators loses commission, loses income. So spreading the risk across markets and
WE’RE OBVIOUSLY SEEING INCREASING PRESSURE BEING PLACED ON OPERATORS WITH REGARDS TO MARKETING OF GAMBLING ACROSS EUROPE
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Jessica Moreno, Principal at JMore Legal in Malta
MARKETING
Peter Ješko, Data Analysis & Affiliate Relations Lead at CasinoGuru
IT IS ABOUT FOCUSING ON DOING THINGS BETTER THAN THE OPPOSITION AND FOCUSING ON SMALL MARKETS MAY WELL BE THE WAY TO ACHIEVE THAT
operators is to be advised.” Sims was joined on the panel by Yaroslav Stanev, Chief Marketing Officer at betting affiliate Oddspedia; Peter Ješko, Data Analysis & Affiliate Relations Lead at gaming affiliate CasinoGuru; and panel moderator Jessica Moreno, Principal at JMore Legal in Malta. Staying on the topic of regulation, Ješko pointed out that smaller affiliates must identify a niche and tailor their content around that. He added: “Smaller affiliates should look for niches and settle into them with well targeted content. It is about focusing on doing things better than the opposition and focusing on small markets may well be the way to achieve that. I agree that one risk of this is that legislation and regulation changes are very hard to predict.” A trend that we’re seeing now across the affiliate landscape, according to Moreno, is the ‘increasing pressure on operators when it comes to gambling advertising’, with Spain recently introducing heavily
restricted advertising guidelines and UK operators voluntarily rolling out a whistle-to-whistle ban on betting ads. Moreno said: “We’re obviously seeing increasing pressure being placed on operators with regards to marketing of gambling across Europe. There’s an outright ban on advertising
IF THE MARKET IS OVER REGULATED FOR BOTH OPERATORS AND AFFILIATES, THEN THE BLACK MARKET WILL BECOME MORE POPULAR in Italy, and with very limited affiliate marketing permitted in Belgium, who are also seeing impending changes in legislation as their board restricts the ability to advertise. In addition, German proposals outlaw almost all forms of affiliate marketing, and on top of that, Sweden has very stringent restrictions on bonuses.” However what must be avoided,
said Ješko, is the over-regulation of the market which he explained will boost traffic towards black market, unregulated sites. “What I would advise affiliates to do is to be measured, and remain calm. If you look at it from a price perspective, a ban on marketing activities which encourage people to gamble may not necessarily be a bad thing. But on the other hand, banning informational websites won’t help gamblers in any way, as you’re making it harder for them to choose the right casino or sportsbook. “In general, I think that if too much over-regulation is already placed on both operators and affiliates, then the black market will become more popular. This is bad for the clients, bad for affiliates, bad for everyone. So I think this may happen in some countries.” Stanev highlighted that in order to remain compliant, there must be clear channels of communication between both affiliates and operators, something which he explained can
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Spreading the risk
MARKETING
Ian Sims, founder of Rightlander
SPREADING THE RISK ACROSS MARKETS IS IMPORTANT FOR AFFILIATES
often go amiss. He said: “There are many ways in which affiliates can gain that compliance advantage. But one example for me that I think can help is establishing a better working relationship between operators and affiliates. This is really essential for compliance. “Right now, there is a general lack of communication between them. Operators have not been notifying affiliates about major updates or new promotions. They're really tangible issues between operators and their affiliates that could be vastly improved with only a few emails or Skype chats or other forms of communication.” On the question of affiliates being authoritative in their content and building a reputation, Sims explained that players want to hear from those which have extensive knowledge in a certain field: “It’s quite simple, players want to hear from people who know what they’re talking about. “Compliance doesn’t have to be negative. The good thing is that compliance can build trust. If you have players that trust affiliates and trust operators, then you will have a perhaps smaller but better base of
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COMPLIANCE DOESN’T HAVE TO BE NEGATIVE. THE GOOD THING IS THAT IT CAN BUILD TRUST players to work with. Ješko concurred: “We want good relationships with operators of course but we want to offer our players the best information.” “It’s about striking a balance,” continued Sims. “I’d be looking at removing anything from my website that could be deemed a risk. Especially old content or content that suggests that gambling can improve a player’s lifestyle, for example. “I think the competitive advantage comes from being able to get through this compliance minefield and show you can work in this environment – that you can be trusted by operators and players. “There are real positives to this if you can drive through it. But I think
one thing you need to be mindful of is making sure you spread the risk, because I think there's going to be a lot more regulatory changes coming up in a lot of countries as we have already seen. “A lot of these changes will pose a lot of problems for affiliates, particularly if you’re well invested with an operator in terms of the amount of players you’ve got but they’re not taking their compliance obligations seriously. “If an operator has other affiliates that are not acting accordingly, that could ultimately come back to haunt you as that affiliate programme might get fined, they might lose their licence, they might have to pull out of that market for whatever reason. “We've seen a couple of operators pulled out of the UK, which has been because of compliance issues. So my advice is spread the risk around, and ensure that you work with enough operators and have enough players with each one.” •
IF AN OPERATOR HAS OTHER AFFILIATES THAT ARE NOT ACTING ACCORDINGLY, THAT COULD ULTIMATELY COME BACK TO HAUNT YOU
Reach out and find out why we are the world’s favourite affiliate programme today. support@bet365affiliates.com bet365affiliates.com
Second screen
A DECADE OF SOFASCORE: ADAPTING TO A DYNAMIC AFFILIATE LANDSCAPE AS THE DEMAND FOR INSTANT ACCESS to live score feeds
grows, it falls to affiliates such as SofaScore to keep close tabs on changes to consumer habits and make the necessary technological developments
Z
latko Hrkać and Ivan Bešlić are childhood friends who started SofaScore 10 years ago from Zagreb, Croatia. What started as a hobby has grown to a global project with more than 20M monthly active users. SBC: Did you expect the company to be where it is now when the company began? ZH: The truth is that at the beginning, we weren’t thinking about managing a company of almost 100 people or having a product that is used worldwide every day. Today you constantly hear about start-ups and projects that exploded over night, and that was never the story of SofaScore.
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We started the project out of hobby, buying first live scores feeds in 2010 and building the project with passion, rather than outside investment. We were pouring our heart and soul into the project and it grew steadily, but it was in 2014 we felt that we could disrupt the live scores industry by providing something that the
WE STARTED THE PROJECT OUT OF HOBBY, BUYING FIRST LIVE SCORES FEEDS IN 2010 AND BUILDING THE PROJECT WITH PASSION, RATHER THAN OUTSIDE INVESTMENT
competition doesn’t have – a deep dive into statistics through clever infographics. Basically, we decided to use the thousands of statistics we had at our disposal from different providers and create something unique. Player ratings in football were just the beginning as several other features rolled out in the next few years, primarily in football, but also in basketball. Slowly, SofaScore has positioned itself as a leader in sports analysis, giving the project a whole new dimension. It’s been 10 years already, but we are still working with the same passion as on the first day. SBC: How do you feel the affiliate and data sectors have changed over the last 10 years? What's been your biggest challenge in that time? IB: Change is a constant factor in our business and there were a lot of challenges through the years. For example, between five and six years ago there was only talk about
MARKETING
Zlatko Hrkać (left) & Ivan Bešlić (right)
regulation in the affiliate market, and now we are witnessing it in widespread action. But for us, the focus was always on the product and keeping up with the technologies. SofaScore has been present on all platforms from the beginning (iOS and Android app, website and Windows phone which even today has like 30K monthly active users). We needed to develop a project that is up to date with the current trends, but also a project that is accessible worldwide. For example, we have a lightweight version of the website developed for pre-smartphone mobile phones and countries with traditionally low bandwidths. This approach helped us develop a global brand, and secured traffic from countries that are very popular in the affiliate market today – Kenya, Nigeria, Ivory Coast, Ghana… It is easy to be an affiliate when you have traffic, and we would say it is harder to get traffic today than it was before. Everything is more expensive and bigger; the feeds, the amount of
competitions covered, the demand from users, and on top of all that, you have multiple compliance regulations in place. This is our focus right now, we are closely monitoring the situation in markets like Italy, Germany and the United States, and making necessary adjustments in the product. SBC: How do you expect the affiliate industry to develop in the future?
Blocking domains from foreign sportsbooks is a firefighting solution and, ultimately, consumers who want a better product will find a way to get it. We believe that more and more countries will open up to various licensing processes allowing the market to grow and result in a better product for the end consumer. The more worrying trend recently
BLOCKING DOMAINS FROM FOREIGN SPORTSBOOKS IS A FIREFIGHTING SOLUTION AND, ULTIMATELY, CONSUMERS WHO WANT A BETTER PRODUCT WILL FIND A WAY TO GET IT ZH: The next few years in the affiliate industry will be marked by regulation and consumer protection. We are all aware of the measures some countries are going through with in order to protect local monopolies or safeguard a small local market from online gambling companies. It is understandable from the tax revenue perspective, but we don’t see that this protectionist model will remain.
is a widespread idea of gambling advertising ban which we are seeing in Italy. This is really affecting the industry, and governments need to recognise the positive benefits of allowing, but regulating, the messages advertised by sportsbooks. With the recent outbreak of COVID-19, the gambling industry could be one of the big factors in stimulating economies. From our perspective,
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Second screen
MARKETING
SofaScore product meeting
we welcome all the efforts aimed at consumer protection, but also allowing the user to choose the best product for them or to self-exclude for that matter. SBC: As latency over live sports drops as more events are streamed, does that change the info you deliver? Is speed still the crucial factor? IB: Speed has been the crucial factor from the start and it remains our priority. We have a whole team dedicated to the speed factor, and we have come to a level in which we would need to see the future to be able to send the notification in the millisecond. SBC: What opportunities does 5G provide and is the industry making the most out of the technology in mobile handsets? IB: The industry is really quick in adapting to any technology changes which really shows that the key stakeholders keep close tabs on consumer habits shifts because being able to adapt quickly can make a world of difference. Looking from our perspective of a live scores and statistics product,
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SPORTS CONSUMPTION WILL BE MUCH DIFFERENT IN 10-YEARS TIME AND 5G WILL PLAY A KEY ROLE we see an enormous expansion of technologies that reinterpret how sports are consumed. We are talking here about VR, action widgets, playby-play simulations, streaming… Sports consumption will be much different in 10-years time, and 5G will play a key role as enormous bandwidths will make all these things that are now “challenging”, easily accessible. Of course, some things will be hardly affected. SofaScore, for example, is already the fastest live scores app and 5G will not make our scores any faster (again, we can’t predict the future), but the technology will allow us to explore new options for engaging the users.
SBC: Finally, what are SofaScore’s future plans to ensure that the next 10 years will be just as successful as the last? ZH: As mentioned before, we aimed at disrupting the live scores industry with statistical features and positioning SofaScore as a game companion, rather just than the quick score tool. You now have football fans flocking the stadiums, watching the game live and still looking up the stats on SofaScore. The app is your second screen even when watching the game at home. This is the direction we want to continue taking in the long run. We want to keep listening to the needs of our users, adding new features, adding new sports and exploring the options new technologies bring us. SofaScore has gone through tremendous changes in the past 10 years and we can’t even imagine what the next 10 will bring. •
SOFASCORE HAS GONE THROUGH TREMENDOUS CHANGES IN THE PAST 10 YEARS AND WE CAN’T EVEN IMAGINE WHAT THE NEXT 10 WILL BRING
THE AFRICAN EDITION
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Autumn Series
SBC ANNOUNCES DIGITAL FUTURE FOR EUROPE, AMERICA, CIS & AFRICA SBC HAS FINALISED its autumn 2020 conference &
exhibition calendar, with two new regional showpieces focusing on Africa and the CIS added to its highly popular Digital Summit series
A
dded to this, SBC’s two successful sports betting events Betting on Sports Europe and Betting on Sports America will also be transferred to the virtual environment as a response to the continuing COVID-19 crisis. This means the SBC Summit Barcelona - Digital on 8-11 September will be followed by SBC Digital Summit Africa (6-7 October), Betting on Sports Europe - Digital (21-22 October), SBC Digital Summit CIS (4-5 November) and Betting on Sports America - Digital (1-3 December). Due to the continuing uncertainty around international travel and the potential risk associated with large-
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scale events, SBC has embraced the industry’s desire to focus on virtual rather than physical events this year. The market-leading virtual conference and exhibition series has continued to evolve since its launch in April, engaging more than 15,000 executives to date. As key trade shows such as G2E and ICE have been cancelled or postponed, virtual events offer our
SBC HAS EMBRACED THE INDUSTRY’S DESIRE TO FOCUS ON VIRTUAL RATHER THAN PHYSICAL EVENTS THIS YEAR
industry the opportunity to continue to learn, connect and do business. The new events for Africa and the CIS will focus on the many emerging opportunities and unique challenges of doing business in two regions currently attracting strong interest from the international betting and gaming industry. These events will use the same advanced online platform and mix of high-level content, interactive exhibition and networking roundtables that proved so successful at the global SBC Digital Summit in April, and at subsequent editions dedicated to Latin America and North America, and at CasinoBeats Malta Digital. SBC Digital Summit Africa includes a two-day conference focusing on the future of sports betting and gaming in a region where the industry continues to grow and develop rapidly. It features 75 senior executive speakers from both local and
MARKETING
international operators already established in a variety of African markets, who will share their experiences of working in the region and insights into the best emerging opportunities. This will be accompanied by a 25-booth interactive exhibition that will allow operators to view the latest industry innovations and talk to suppliers who have products and services tailored to meet the requirements of African markets. There will also be networking roundtables and workshops for delegates to connect with fellow attendees and build new relationships.
SBC Digital Summit CIS, delivered in association with Sports Media Holding, will feature a line-up of 75 senior executive speakers sharing their experiences of and ideas for the CIS sports betting and gaming industry, together with an interactive exhibition and multiple networking opportunities. Sojmark continued: “At our previous events, conference sessions about opportunities in the CIS have always proved popular, so we’re delighted
to be staging our first event fully dedicated to the region. “The CIS is a major opportunity for the international industry, with existing markets such as Georgia booming and attracting leading operators, including Paddy Power Betfair, GVC Holdings and Betsson, while major new markets are soon to open up in Ukraine and Uzbekistan. “However, in-depth knowledge about these markets is hard to
WE’RE EXCITED ABOUT THE PROSPECT OF STAGING OUR FIRST EVER EVENT DEDICATED SPECIFICALLY TO THE BETTING AND GAMING INDUSTRY IN AFRICA
Rasmus Sojmark, Founder and CEO of SBC, said: “We’re excited about the prospect of staging our first ever event dedicated specifically to the betting and gaming industry in Africa, and bringing our popular virtual conference and exhibition format to a new audience. “The event will provide a valuable forum for operators, affiliates and suppliers in the region to connect, share their knowledge of established and emerging markets across the continent, and identify the many business opportunities it offers.”
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come by and the industry network is developing quickly. We are very happy to partner with Sports Media Holding, a key player in this region, for SBC Digital Summit CIS, which will be an important learning and knowledge sharing opportunity for senior executives from operators and suppliers with an interest in the region.” In addition to the new regional events, SBC’s autumn sports betting trade shows will be converted into a virtual format on their previously announced dates. The change means that the events will continue to provide a setting for suppliers to showcase their latest products and services to operators, and allow important discussions about the future of the industry to take place, all within a safe environment that people can access from their offices or homes. Betting on Sports Europe - Digital, which was due to take place at The Oval cricket ground in London, includes an eight-track conference featuring 100 high-level speakers, including senior executives from a number of the continent’s biggest betting brands. Much of the agenda for the conference focuses on the many challenges facing operators in Europe, providing a forum for the development
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MARKETING
THE CIS IS A MAJOR OPPORTUNITY WITH EXISTING MARKETS SUCH AS GEORGIA BOOMING, WHILE MAJOR NEW MARKETS ARE SOON TO OPEN UP IN UKRAINE AND UZBEKISTAN and sharing of new ideas that will help the industry to move forward. There are also conference tracks about payments, lotteries and technology, along with a day of content dedicated to the affiliate sector and the latest marketing techniques. A range of networking sessions, roundtables and workshops will enable Betting on Sports Europe Digital delegates to engage in active discussion and build new connections, while the 30-exhibitor expo hall will allow delegates to keep abreast of the latest product innovations. The second edition of the world’s largest dedicated sports betting event was due to see SBC return to New Jersey’s Meadowlands Exposition
Center, the scene of its hugely successful debut US trade show last year. Instead, SBC will stage Betting on Sports America - Digital in December, bringing together the major players in the US market in a virtual environment. The event will feature a top-notch roster of leading executives from major operators, regulators, affiliates, and professional sports leagues and teams sharing the lessons they have learned in the two years since the repeal of PASPA, together with their insights on the many opportunities offered by legalisation in an increasing number of states. Along with the content, there will be a wide range of opportunities for operators to connect with suppliers and affiliates to talk business. They include themed networking roundtables focused on specific market segments, workshops and an interactive expo hall displaying the latest products for the US market from innovative international suppliers. For updated information on the new and revised events, please visit www. sbcevents.com. •
INSTEAD, SBC WILL STAGE BETTING ON SPORTS AMERICA - DIGITAL IN DECEMBER, BRINGING TOGETHER THE MAJOR PLAYERS IN THE US MARKET IN A VIRTUAL ENVIRONMENT
#SBCDSCIS 4-5 NOVEMBER 2020
THE CIS EDITION OF THE WORLD’S
LARGEST ONLINE BETTING
AND GAMING EVENT 2,000 Delegates
75
Speakers
ORGANISED IN ASSOCIATION WITH
FOR MORE INFORMATION PLEASE VISIT WWW.SBCEVENTS.COM
25
Exhibitors
#BOSADIGITAL DECEMBER 1-3, 2020
THE LARGEST
DEDICATED SPORTS BETTING EVENT IN NORTH AMERICA ONLINE EDITION 3,000 Delegates
130
Speakers
40
Exhibitors
FOR MORE INFORMATION PLEASE VISIT WWW.SBCEVENTS.COM