SBC Leaders Issue 14

SPORTS BETTING

ISSUE 14 • APRIL 2021

NEW TRENDS

Riding the omnichannel tiger in Italy OLD MYTHS

Online gambling in Mexico

Ulrik

Bengtsson William Hill

Creating the safest environment for its players

SLOTS

A low-stake led future?

SPORTSBOOK

Platforms under scrutiny

6-20 Sports Betting

• Ulrik Bengtsson: Player protection and the regulatory 'blind spot' • Microgame: Riding the omnichannel tiger in Italy • Scientific Games: Taking platform performance to the next level

CONTENTS APRIL 2021

• PandaScore: Why it’s time to get serious about esports betting

22-28 US Market

• Paysafe: The impact of COVID-19 on US sports betting • Sightline Payments: Driving US acquisition and retention

30-32 LatAm Market

• Lazcano Sámano: Three myths about online gambling in Mexico

34-44 Marketing

• Parimatch: Top marketing trends for betting in 2021 • Sports fans at the heart of Oddspedia’s marketing mix • How the sports media landscape is evolving in Italy

46-54 Casino

• The low-stake entertainment-led future for online slots • Why the US has become the top priority for NetEnt • SlotBeats' Slot of the Week: Winners Review

56-62 Payments

• How the pandemic has reshaped the use of cryptocurrency • Trustly: The commitment to providing value beyond payments

64-66 Lottery

• The National Lottery tender: History and past contenders

67-70 SBC Leaders Podcast

• Matt King: Why FanDuel is focusing on product development

The SBC Leaders Magazine is brought to you by SBC - Sports Betting Community: EDITORIAL TEAM: Luke Massey, Erin Gallagher, Andrew McCarron, Craig Davies, Ted Menmuir, Joe Streeter, Chris Murphy, James Ross, Lucia Mouriño, Conor Porter, Holly Hunt SALES TEAM: Rasmus Sojmark, Alyona Gromova, Conall McCabe, Ross Main, Jan Willem Volbeda, Nancy Bishop 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

2 SBC LEADERS • APRIL 2021

A V A

N

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O LAB W LE

INTRO Luke Massey Head of SBC Media

W

elcome to the second edition of SBC Leaders for 2021!

It’s not been an easy ride over the last 12 months, has it? Here in the UK, the shutters have remained firmly closed on the betting shops for the most part, the drama at Cheltenham was played out behind closed doors (We know, it should have been the same last time) and Liverpool won the Premier League.

Yet as we pass a year in lockdown, dare we say it, things are finally starting to look a little sunnier. If all goes to plan, we’ll be freely meeting our friends and walking back through those THE BETTING AND turnstiles to cheer on our favourite teams before we GAMING INDUSTRIES know it.

HAVE DEMONSTRATED The journey we’ve been HUGE RESILIENCE on towards reopening the TOWARDS ANY economy here has been CHALLENGES THROWN arduous, stressful and, at THEIR WAY times, confusing, but it’s fair to say the betting and gaming industries have demonstrated huge resilience towards any challenges thrown their way.

Another European country hardest hit by Covid has been Italy. Yet despite the turbulence, exacerbated greatly by advertising challenges, the gambling market appears to be hurtling forwards.

Most notably, more operators are opening their eyes to the possibilities of the online market.

Microgame CEO Marco Castaldo tells us more about the context for this online growth in this issue of SBC Leaders. His missive also warns us that alongside that growth there is a worrying tendency among politicians in the country who appear nostalgic about

4 SBC LEADERS • APRIL 2021

Erin Gallagher SBC Leaders Deputy Editor

a “see-no-evil” past where gambling is hidden away, out of sight and, unfortunately, out of control.

By contrast, European counterparts Germany and Holland are grappling with measures that should, in theory, bring transparency to the market. It hasn’t been plain sailing for the Dutch though - the implementation of its Remote Gambling Act has arguably been scheduled and rescheduled more times than the UK’s exit from lockdown.

If we can offer a small piece of advice, which may also pertain to the chopping and changing in Italy - and Spain for that matter - it would be to err on the side of caution when considering too many new restrictions for its licensees to weather.

Looking at Sweden as a cautionary tale, a gung-ho approach to limitations will only result in a worrying shift towards increased black market activity.

The rates of channelisation are quickly becoming a real cause for concern, said William Hill CEO Ulrik Bengtsson as part of our lead interview.

This exclusive is followed by articles on so many other hot topics for the industry, including the bright future for esports. We also feature the latest developments on the new National Lottery tender and address myths about online gambling in Mexico, as well as introduce a shiny new podcast series for SBC Leaders.

So while we may not have our crystal ball handy to read the future, what we can say is that the contents of this magazine are guaranteed to inform, enlighten and put a smile on your face!

Expand your Horizons with an exceptional Sports Betting and iGaming platform

www.delasport.com | sales@delasport.com

Protecting the ecosystem

ULRIK BENGTSSON: BLACK MARKET CONCERNS AND THE REGULATORY 'BLIND SPOT' THE WILLIAM HILL CEO TAKES HIS SIDE in the debate

around affiliate licensing, before explaining why player safety forms a central part of the operator’s DNA and reflecting on the worrying prevalence of black market activity in Sweden and beyond

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illiam Hill Group CEO Ulrik Bengtsson believes that a company’s every fibre should be focusing on enabling its customers to play in a safe environment.

Speaking to SBC Leaders during the UK consultation into the 2005 Gambling Act, Bengtsson said that everyone’s focus should be on protecting the vulnerable when it comes to both operational and regulatory discussion.

William Hill itself is committed to providing customers with a safe, engaging experience, and Bengtsson said this philosophy is coded into the core of how the business operates.

The William Hill CEO noted that the operator’s key ambition is to make sure that no player who uses their product is unduly affected - but explained that this was ‘always going to be aspirational’.

He explained: “The DNA of William Hill and the way we approach these things is with the ambition that everyone using our products or services should do so in a safe environment. There will obviously be a few cases that slip through the net, but we need to be able to look ourselves in the eye and say we did everything we could, at every given junction, to protect our customers.

“Sometimes things go wrong.

Sometimes customers want it to go

6 SBC LEADERS • APRIL 2021

wrong because they actually try to circumvent the system; they use various email addresses and different names. And sometimes, we make mistakes. This means I don’t believe that it is possible to get to zero, but we want to get as close as possible.

“The DNA of William Hill needs to be that we want our customers to have a positive experience. We want them to have fun, we want them to engage with each other, we want them to enjoy betting on sports and enjoy the event, that’s what we’re all about.”

Bengtsson believes that it is much better for all concerned that those who develop problems are handled within a regulated environment as the prevalence of the black market is arguably one of the biggest threats to player protection, with many unlicensed operators failing to implement safer gambling measures.

Earlier this year, a report published by the European Gaming and Betting Association highlighted a worrying trend in black market activity across Sweden.

And for Bengtsson, the rates of channelisation across Sweden are a real cause for concern. Because while 38% of players have self-excluded in the central database - banning any licensed operator from taking their business - there is a large chunk of these players continuing to gamble offshore.

WE NEED TO BE ABLE TO LOOK OURSELVES IN THE EYE AND SAY WE DID EVERYTHING WE COULD

SPORTS BETTING

THE DNA OF WILLIAM HILL AND THE WAY WE APPROACH THESE THINGS IS AN AMBITION THAT OUR CUSTOMERS HAVE A SAFE ENVIRONMENT TO PLAY, WITH APPROPRIATE GUARDRAILS FOR OUR PLAYERS

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Protecting the ecosystem

He explained: “30% of those continue to play and given that repository, it’s impossible to play within the licence. That then means that all of them played offshore - that’s an enormous number. You’ve just got to be awake, alert and realise that is a huge threat for consumer protection."

At the beginning of the pandemic, Ardalan Shekarabi - Sweden’s Minister for Social Security - unveiled a list of measures for the country’s gambling industry which were targeted at reducing rates of gambling.

But for many, these restrictions caused a leakage from the regulated market, with Shekarabi’s vision proving to drive more players towards unregulated betting operators. So why

did these measures prove ineffective?

“In Sweden, they put a number of laws in place with regards to tax rates on winnings. But generally, I think it isn’t enough,” Bengtsson added.

“I have been a big advocate for introducing licences for affiliates to be able to operate in the market.

“But you also need to put licences in place for suppliers to ensure they don’t supply non-licensed operators.

You have to license the entire ecosystem, payment providers, etc. in order to protect the market. Then, you

WHAT’S BEEN DRIVING THESE NUMBERS IS WHEN PRODUCTS IN THE REGULATED MARKET ARE NO LONGER COMPETITIVE

8 SBC LEADERS • APRIL 2021

WE’RE TALKING ABOUT A VERY DARK CORNER OF THE INDUSTRY HERE, YOU NEED TO BE ABLE TO ALSO GO AFTER THE AFFILIATES THAT DON'T LIVE UP TO THE EXPECTATIONS need to have a functioning and well resourced enforcement arm as well.”

Affiliates can create somewhat of a ‘blind spot’ for regulatory bodies, explained Bengtsson. “I think there hasn’t been enough consideration for the whole ecosystem when we talk about problem gambling, affordability and re-regulating the industry. I think we have to take a broader approach,

and licensing affiliates is such an important part.

“We all know many of the big affiliates are very responsible and they’re almost like media houses today. But nevertheless, that is not all of them. We’re talking about a very dark corner of the industry here, you need to be able to also go after the affiliates that don't live up to the expectations.”

From an operator’s perspective, Bengtsson said that the Swedish Covid regulations have contributed to a ‘decrease in competitiveness’ of products, ultimately driving players towards the black market.

He continued: “What’s been driving these numbers is when products in the regulated market are no longer competitive. That’s when you risk

forcing the players to go offshore.

The more you do to decrease the competitiveness of the product whether it’s around bonuses or if you make it really hard or intrusive for the customer to play - the more likely

SPORTS BETTING

players are to gamble on the black market.

“Safer gambling today is so much about data, it is about monitoring and screening customers, it can feel really intrusive for the player. That’s

when you’re forcing people out to the black market. No one asks any questions there, no one asks you for your payslip, no one checks your line of credit.

“I do recognise that we have a huge

obligation to make sure our customers play within their means. We should do a reasonable amount of affordability checks but it can’t be to an extent that it’s so intrusive, we force these customers out.”

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Taking a holistic approach

MICROGAME: RIDING THE OMNICHANNEL TIGER MICROGAME CEO MARCO CASTALDO says we will look

back on the last 12 months as a defining era for gaming in Italy, before discussing how its operators must deploy a holistic, from-the-ground-up approach

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oday, as is the case in most countries, Italian gaming operators are still struggling with widespread shop closures while the acceleration of online growth continues (45% higher GGR year-on-year), so what does this mean for the future?

The Italian context has certain specificities that provide us an interesting and possibly different vantage point from other jurisdictions.

First, online gaming penetration in the Italian gambling market was only 9.5% prior to the pandemic which is comparatively quite low. Coronavirus accelerated a process with a long growth curve ahead. Conversion to online is, therefore, not a one-time Covid-19 effect.

Italy has a long history of multichannel business models, starting with land-based affiliation and service for online players in the late nineties

10 SBC LEADERS • APRIL 2021

to more recent efforts at shop-online betting integration in the last two or three years.

In a sense, the pandemic also accelerated another trend where Italy was ahead of other markets - towards omnichannel strategies to use a popular and abused term.

We have some perspective here: Microgame is a pioneer in this field with almost three decades of experience and our entire stack and service approach was created to bridge land-based and online gaming.

We currently serve over half of the near-100 licensed online operators

IN A SENSE, THE PANDEMIC ACCELERATED ANOTHER TREND TOWARDS OMNICHANNEL STRATEGIES, TO USE A POPULAR AND ABUSED TERM

and over 15 licensed betting shop operators. This gives us a broadbased view of industry and market dynamics which we are happy to share in the interest of the common cause.

So, what happened in the last 12 months and where are we headed?

It's interesting to analyse the difference between the first pandemic wave and the second. In the first wave, the main driver of online GGR growth was the increase of time available for existing players. It’s not surprising that poker, skill games, and bingo outgrew other verticals during that period with the lack of sports events having a major impact, of course.

In the second wave, starting in October, the main effect we saw was a huge increase in the number of players as operators with at least basic multi channel capabilities used the summer “break” in the pandemic to convert betting shop customers to online players.

Most of these new players will go back to the shops when they reopen, but they will be different, because only a few will return to being shop customers only. Most have discovered a new, engaging and convenient experience, but will remain loyal to their familiar retailers. They will become omnichannel players.

Let’s not forget that all of this is happening against a difficult institutional backdrop, a toughening political and regulatory stance, resulting in restrictions on shop locations as well as on advertising, and probably more to come.

The market is hurtling forward while politicians seem nostalgic about a “see-no-evil” past where gambling is hidden away, out of sight and, unfortunately, out of control. But that’s a theme for another article…

In this context of accelerated change, what are the challenges for incumbent operators? Onlinefocused operators need to contend with advertising restrictions and must

SPORTS BETTING

technology, product, as well as organisation.

It may be obvious, but we are talking about operators who have no experience offering online gaming facing players who have no or limited familiarity with the online journey. How to address this is a little less obvious.

On the player side, simple is key.

User interfaces need to be accessible and intuitive. Promotions and features need to be presented to a player who doesn’t know what to look for.

Proactive communication to the player must be delivered in-website and in-app.

IT’S UNREALISTIC TO THINK THE SAME OFFER AND PRESENTATION WILL BE EFFECTIVE FOR LAND-BASED PLAYERS NEW TO ONLINE

ponder whether and how to try to access the main source of growth, i.e. players from shops and gaming halls.

Land-based operators divide into two groups: those with the foresight (or luck) to have established an online presence before the pandemic need an effective strategy for maintaining new online players during lockdown, and a compelling “omnichannel” value proposition for after the pandemic.

Those operators who have no online capabilities, clearly, need to acquire them as quickly as possible through alliances and partnerships

of one form or another. Operators of AWP routes and of VLT Gaming halls, in general, are further behind here.

These different challenges have one thing in common. Each situation means entering unfamiliar territory from different standpoints:

THE MARKET IS HURTLING FORWARD WHILE POLITICIANS SEEM NOSTALGIC ABOUT A “SEE-NO-EVIL” PAST WHERE GAMBLING IS HIDDEN AWAY

This doesn’t just mean push-type notifications, by the way, as many of these new players mistrust aggressive communication and prefer to read and digest messages on their own terms.

Then we have the issue of cash. This is a key requirement for engaging the broad segment of new players.

Sure, pandemic-driven sign-ups have taken land-based players beyond the so-called anonymity barrier, but that’s not necessarily the main driver and it doesn’t mean players now want to stop using cash.

Therefore, the offer needs to include a seamless, convenient and fully compliant way to cash in and out of the wallet. (Remember, in Italy all gaming account transactions are logged with the regulator’s systems and operators must track and report for AML, so everything is traced, no worries there…)

How about the product side of the player experience? It’s unrealistic to think the same offer and presentation will be effective for land-based players new to online. We find that land-based players are generally more recreational in approach. This means a broad multivertical offer is important - bingo and poker can be excellent entertainment and conversion tools.

After all, one of the main revelations of moving online for a shop player is finding lots of other fun stuff to do

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Taking a holistic approach

SPORTS BETTING

that was not available in the shop.

Moreover, players are accustomed to lower margins (see online slots vs AWPs) and are generally less “pricesensitive”.

Having familiar slot titles from the AWP and VLT world is important, and these need to be easily accessible for the player in the sea of games typically seen on an online showcase.

Also, you need to provide for low minimum buy-ins and offer lots of free play opportunities.

The operator needs to deploy an effective portfolio of online engagement tools which take into account a player journey that includes attending the physical premises. This starts at the CRM side of the platform.

TODAY IT’S ALMOST IMPOSSIBLE TO FIND A PLATFORM OR GAME PROVIDER WHO HASN’T SLAPPED THE TERM “OMNICHANNEL” ON THEIR ADS AND PRODUCT BROCHURES

We found integrating a class-leading CRM software suite into our platform didn’t work in the multichannel arena and we spent three years developing our own in-house CRM engine and tools which allowed us to “measure” player behavior in a way that’s sensitive to context and channel. To be truly effective, this development is by definition never-ending, something third-party platforms don’t really allow you to do.

Finally, the operator needs to effectively manage the retail network side of the online operations, and vice-versa. This means effective, timely information, strong analytical tools, and an affiliation back-end tailored to high-number, multi-level physical distribution networks. This

12 SBC LEADERS • APRIL 2021

is a very specific piece of tech that you normally don’t find in an online gaming platform, and or as an aftermarket “bolt-on”.

Microgame’s affiliation engine benefits from 20 years of experience and development, allowing practically infinite combinations of vertical incentive packages for up to 10 levels in the distribution channel. This kind of tool makes the difference in your competitiveness with the distribution channel, which is key because you are no longer competing just for the retail venue or for the player, but for both.

Today it’s almost impossible to find a platform or game provider who hasn’t slapped the term “omnichannel” on their ads and product brochures.

Going beyond the buzzword, however, means a different approach to the market which requires a different strategy, a different organisation, and a different approach to the tech stack as a whole.

I BELIEVE THE WINNERS WILL BE THOSE OPERATORS ABLE TO FACE THE EVOLVING MARKET REALITY WITH THIS KIND OF HOLISTIC, FROMTHE-GROUND-UP APPROACH

It’s not just about buying in IT modules or games with the right label. In fact, it’s quite a challenge (if not impossible today) to build a competitive, truly omnichannel technology and product platform by using “off the shelf” stuff.

Microgame‘s 25 years’ of experience in full outsourcing for online operators who affiliate and serve online players in retail, and our 10 years of experience in serving operators with separate licences for online and betting shop operations, have taught us that success depends on internal consistency of the strategy, which depends on strong internal integration of the tech stack.

This is why we have always worked to build everything within the logic of channel convergence, in house: from the platform to game portfolio delivery to engagement tools, affiliation and CRM modules, and so on.

In the post-pandemic world, I believe the winners will be those operators able to face the evolving market reality with this kind of holistic, fromthe-ground-up approach. In any case, we face interesting times ahead with serious challenges but also wonderful opportunities for learning and for positive change! •

Sportsbooks under scrutiny

SCIENTIFIC GAMES: TAKING PLATFORM PERFORMANCE TO THE NEXT LEVEL KEITH O’LOUGHLIN highlights why sportsbook platform

reliability and new technology is key for taking the sports betting experience to new heights

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ontinuously evolving the sportsbook proposition is of great importance, but we should never lose sight of the fundamental purpose of a platform – the ability to accept and process a bet seamlessly, writes Keith O’Loughlin, Senior VP, Sportsbook at Scientific Games.

Reliability is absolutely paramount to operators. Without a stable and robust platform to work from, operators are more than likely to miss out on valuable revenue opportunities, especially if downtime occurs during major sporting events when sportsbooks are put to the ultimate test.

14 SBC LEADERS • APRIL 2021

Sportsbook performance has come under scrutiny in recent months, particularly in the US after several operators reported downtime around February’s Super Bowl LV where the Buccaneers beat the Chiefs by 31 – 9, which saw many unhappy customers unable to place a bet and claim winnings.

SPORTSBOOK PERFORMANCE HAS COME UNDER SCRUTINY IN RECENT MONTHS, PARTICULARLY IN THE US AROUND FEBRUARY’S SUPER BOWL LV

These are key moments within the user journey and disruption of any kind will lead to an unhappy customer, which can have a lasting and negative impact on a brand’s image.

Such performance issues are resulting in many operators weighing up the opportunity of taking full control of their operations as opposed to leaning on third-party support.

Ultimately, it is up to suppliers to ensure their platform offering is able to cope under the pressures of peak betting times.

Above all else, having a back office system and associated processes that are robust, reliable and able to cope with the demands when customers need to access the platform is key.

This is the major reason why Scientific Games continues to make significant investments to ensure that we have scalable and reliable solutions.

To illustrate this, the OpenSports™ platform has consistently supported the highest level of service and robustness for its customers worldwide during key events for 25 years.

Taking platform performance to the next level Scalability and performance are key to any platform that operates with the level of transactions that many leading bookmakers will encounter on a regular basis. Keeping a high standard of zero downtime requires constant reviews and upgrades at the back-end

SPORTS BETTING

OPENSPORTS™ PLATFORM HAS CONSISTENTLY SUPPORTED THE HIGHEST LEVEL OF SERVICE AND ROBUSTNESS FOR ITS CUSTOMERS WORLDWIDE DURING KEY EVENTS FOR 25 YEARS

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Sportsbooks under scrutiny to maintain performance.

The assumption that a platform is ready for the next big test based on its previous performance around a major sporting event invites the potential for future issues. Just as a lengthy list of aircraft checks are carried out ahead of every single flight, platforms must also undergo rigorous testing to ensure there are no faults.

At Scientific Games, we are proud of the fact we have been able to handle peak volumes for high profile events with no degradation in service on an ongoing basis. This is underpinned by our commitment to continually monitor and improve our platforms to ensure a faultless performance every day.

SPORTS BETTING THE ASSUMPTION THAT A PLATFORM IS READY FOR THE NEXT BIG TEST BASED ON PREVIOUS PERFORMANCE INVITES THE POTENTIAL FOR FUTURE ISSUES February’s Big Game in the US, we offered over 700 different markets for bettors to enjoy and much more than what we would be able to for a regular-season match.

This included several novelty markets, such as the colour of the sports drink that gets thrown at the coach, or what the opening song will be in the half time show, which creates additional complexity when it comes to trading.

Platform offerings must be current, performant and provide a great user experience. Most recently we have been focused on migrating our front-end user experience to a new technology stack to provide a slick digital interface with flexibility and enhanced functionality.

We are also enhancing our trading platforms to give traders more functionality and data at their fingertips to enhance the end user experience.

For March Madness, another important betting event for the industry, our operator partners are offering more markets for the 2021 tournament than ever, driven by the demand for player propositions.

Expanding the sportsbook offering to meet the demand from bettors who have a strong desire to experience new forms of entertainment of course brings it challenges, but equally provides an opportunity to take the industry forward.

What is critical, however, is the reliability and scalability of the core platform to allow such advances in sportsbook provision. Without doubt, proven and new technology is the key to evolving the sports betting experience.

Embracing new technology One of the main benefits of leaning on a third-party provider is how these organisations are constantly experimenting and utilising new technologies to raise the sports betting game.

Artificial intelligence (AI) and machine learning are affecting all areas of our lives and driving huge changes in the areas of decision making and personalisation of offerings to customers.

As bettors become more sophisticated and the number of markets increases, the use of AI and machine learning is becoming far more prominent to ensure that we are able to provide the latest information and, increasingly, a more tailored experience.

By understanding past trends and behaviours, we can use predictive analytics to give customers an ever more bespoke service and options at their fingertips, when they want to use them responsibly.

Responding to high expectations The demand for sports betting continues to grow apace, with so many people across the globe appreciating it as a highly engaging and fun form of entertainment. As a result, bettors are becoming ever more sophisticated and demand high standards, rich functionality, the very latest prices and low latency.

In turn, these demands drive our platform offering forward to support their ever-increasing needs. For

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THE USE OF AI AND MACHINE LEARNING IS BECOMING FAR MORE PROMINENT TO PROVIDE THE LATEST INFORMATION

TECHNOLOGY SOLUTIONS FROM THE SPORTSBOOK EXPERTS

TAP INTO DECADES OF INDUSTRY EXPERIENCE TO POWER SOLUTIONS ACROSS THE GLOBE

Contact: openservices@sgdigital.com

Cracking the esports code

PANDASCORE: WHY IT’S TIME TO GET SERIOUS ABOUT ESPORTS BETTING PANDASCORE CEO FLAVIEN GUILLOCHEAU explains why

esports is now the biggest potential source of new customers for bookmakers, adding that ‘cracking the esports code’ doesn’t need to be complicated

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sports betting is something that operators have struggled to get right to date, with many not taking the vertical seriously until recently.

But following the Covid-19 pandemic, esports and esports betting is enjoying a surge in activity which shows no signs of slowing down.

We spoke to Flavien Guillocheau, CEO at PandaScore, to learn more about the thriving market and how

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operators can leverage the huge potential on the table.

SBC: Have the past 18 months proved to online gambling operators that they now need to get serious about esports? And, if so, why now?

FG: I would say 18 months ago, esports was not taken as seriously as it should have been. During Covid many people were still saying that esports was just getting big because of the pandemic

and a lack of live sports. But now that the upward trend has continued and volume didn't fall flat, most of the industry sees it as a serious sector.

For most bookmakers, esports is bigger than many sports they offer, and quite often we hear that esports is top five in terms of bet volume and earnings. There are no sports growing as fast as esports and there is no bigger potential source of new customers for bookmakers in the future.

SBC: Why have traditional online gambling operators failed to crack the code when it comes to esports?

How can they better understand the esports audience?

FG: Cracking the esports code

SPORTS BETTING

THERE ARE NO SPORTS GROWING AS FAST AS ESPORTS AND THERE IS NO BIGGER POTENTIAL SOURCE OF NEW CUSTOMERS FOR BOOKMAKERS IN THE FUTURE

MANY OPERATORS HAVE BEEN HESITANT TO PUT ENERGY INTO ESPORTS BECAUSE THEY LACK INTERNAL EXPERTISE AND AREN’T SURE WHERE TO START

doesn’t need to be complicated for bookmakers. When bookmakers launch any product, they need a quality offering and to put basic promotional efforts around it. Esports is the same, but many operators have been hesitant to put energy into esports because they lack internal expertise and aren’t sure where to start.

Engaging with esports fans is not that complicated with the right partner advising you on the right coverage, the right markets and understanding

each of the titles. We’ve seen some of our customers with a very little esports expertise grow their volume 2-3 times in less than a year. Anybody can take advantage of the opportunity that exists today.

SBC: What do esports bettors look for when deciding where to wager? What key components must operators do to engage these players?

FG: Esports bettors, just like sports bettors, are looking for a wide variety

of markets, exciting in-play betting opportunities and a consistent offering across the different events. This is something that everyone agrees is missing right now.

The big difference we see between them is that esports bettors want even more interactivity than sports fans, for example they want esports specific markets, not just handicaps.

They are looking for the same type of experience they get from the games they play.

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Cracking the esports code

SPORTS BETTING

overcome and what opportunities can be unlocked as a result?

FG: One common concern that bookmakers have is about the integrity of esports competitions. This is a complex subject that the industry is taking very seriously just as is done in sports.

Thanks to the efforts of all the publishers, tournament organisers, and companies like ESIC; the esports ecosystem has rallied around making sure integrity is maintained. With the data granularity we have in esports, it’s actually easier to spot problematic behaviour.

WITH THE DATA GRANULARITY WE HAVE IN ESPORTS, IT’S ACTUALLY EASIER TO SPOT PROBLEMATIC BEHAVIOUR

SBC: What role does data play in providing a market leading esports betting product?

FG: First, we’ve found that esports fans are even more data driven than sports fans. Having pre-match and live statistics as a widget is a great way to keep the fans on your site and give them the confidence to bet.

Secondly, as always high quality data is needed for building excellent models. Esports is incredibly fast paced and usually more complex than sports. You need high quality data and a large quantity of it to build great models. If you don’t have this, you will lose money.

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Lastly, the esports data market is fragmented today; you need a consistent and global coverage to model effectively. If you don’t give the model the same amount of information it expects, it won’t predict accurately.

It’s like with autonomous cars. If you train a car to drive only during the day, the car won’t be able to navigate safely at night. If you train your esports models with only US and European data, your model will not work with the Asian or Brazilian leagues for instance.

SBC: What challenges do operators face when it comes to esports and data? How can those challenges be

Another challenge is around artificial latency added to live streams, that is sometimes as long as minutes, in order to increase the value of data products from competitions.

The artificial latency unfortunately causes problems for bettors because bookmakers move the odds minutes before the circumstance shows up on the stream. When bettors see this, it discourages betting because they feel like the bookmaker knows something they don’t know.

In esports, there is a data abundance which brings a lot of complexity that we don’t see as much in sports. The challenge for the industry is harnessing that data to create new and tailored experiences for esports fans.

For instance, the live betting experience could be enriched using data to create contextual markets based on the action occurring in the game. Innovation is difficult and requires a lot of effort, but we believe the esports ecosystem will continue to push the boundaries.

SBC: And finally, what can we expect to see this year?

FG: This year is going to be the best year yet for esports betting. Every metric points to 2021 being the year of maturity and growth for this industry.

Many operators are disappointed with the generic esports products they have been sold so far. Our mission is to change that. •

21-24 SEPT 2021

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A year with COVID

SCOT McCLINTIC, PAYSAFE: THE IMPACT OF COVID-19 ON US SPORTS BETTING

W

e’ve now reached the anniversary of when the COVID-19 pandemic changed everything for us – both our society and the US gaming industry, writes Scot McClintic, SVP iGaming Product & Strategy at Paysafe.

It is a milestone that prompts us to reflect and remember the rocky road that led us to where we are today. It is also a milestone to keep us optimistic about the future, and the renewed strength that the gaming sector has demonstrated over the last 12 months, particularly in the online space.

The retail sports betting industry ground to a relative halt when the pandemic began its crescendo in March 2020, with many of the betting world’s marquee events postponed or cancelled as a result. From March Madness, to the Olympics and European UEFA Football Championship, it was relentless.

Even when sports began to return, empty stadiums and social distancing measures meant the vibe was new and unfamiliar compared to the highenergy atmosphere we as fans had long been familiar with.

IT IS A MILESTONE THAT PROMPTS US TO REFLECT AND REMEMBER THE ROCKY ROAD THAT LED US TO WHERE WE ARE TODAY

IT'S A MILESTONE WE HOPED TO REACH with the fight

against COVID banished to the history books, but it should - despite the lingering concerns - still serve as a reminder of the 'rocky road' we've got through and the resilience shown by the sector 22 SBC LEADERS • APRIL 2021

Despite the uncertainty that the pandemic initially placed on live sports and the sports betting market, there have been silver linings for the industry.

For instance, table tennis emerged as a major sports market, and continues to be a bettor-favorite today. Who saw that coming a year ago?

More broadly, online casino showed significant strength as a complementary product offering to hedge against sports content, as consumers looked for new forms of entertainment. This was predictable, but consumer engagement and cross-sell metrics from sportsbooks to iCasino were stronger than anticipated.

COVID-19 was, and continues to be, a shock to the industry. And yet we see the resilience of the market, and players’ need to find new and engaging forms of entertainment.

US MARKET

The pandemic has shed a light on the joy of merging digital forms of entertainment such as sports betting with the live sporting events that we love. This physical-to-digital shift was already happening pre-COVID but has been permanently accelerated by the pandemic.

A rapid decline in revenue, followed by an even stronger resurgence The fall in sports wagering revenue in markets like New Jersey from March to May 2020 was precipitous. Total gaming revenue for the Garden State in May dropped 65.4% year-over-year, according to its Division of Gaming Enforcement.

In hindsight, it’s surprising that handle did not decline more. However, this relative overperformance during a black-swan event hinted at what was to come – a bounce back for the ages

CONSUMER ENGAGEMENT AND CROSS-SELL METRICS FROM SPORTSBOOKS TO ICASINO WERE STRONGER THAN ANTICIPATED that should be a source of optimism for the industry.

2020 formed a V-shaped recovery for sports betting, with the latter half of the year outperforming by every metric and setting records. The logical next question for an online operator is this: Is the sports betting second wind sustainable, or will there be a return to a pre-COVID equilibrium?

What does this mean for the future?

COVID-19 changed things. Retail sports bettors, who typically comprise around a fifth of the US regulated market,

turned to online platforms as they grappled with retail sportsbook and land-based casino shutdowns. Casual sports fans who may have debated the idea of opening an online gaming account prior to COVID decided to enjoy a new form of entertainment.

Many factors at play during the pandemic helped fuel this digital shift. And from a customer acquisition perspective, momentum continues to be strong. But that was during COVID, what about now we appear to be transitioning to a post-pandemic world?

In December 2020, we surveyed over 2,000 US sports bettors with online sportsbook accounts across eight states for our annual ‘All the ways players pay’ report. The objective was to find out more about user preferences when making bets online – and the impact of the pandemic was clear.

sbcmagazine.com 23

A year with COVID

Over two thirds (68%) of players told us that they are now more comfortable making online sports wagers – and this was directly a result of online betting being the only available option during the pandemic. In addition, two thirds (65%) of players told us that they are planning to do all their sports wagering online.

Alongside this increased comfort level over placing bets online, there is also the consideration of frequency. We know from our latest research that a majority of sports bettors (61%) already plan to bet more frequently this year than in 2020, indicating a continuation of strong user-driven performance for sportsbooks through 2021.

Holistically, the digitisation of US sports betting, a broader target market of players and pent-up demand were all catalysed by COVID-19. Against the backdrop of newly regulated state markets such as

IT IS LIKELY THAT REGULATORY MOMENTUM WILL CONTINUE THROUGH 2021 AND BEYOND

24 SBC LEADERS • APRIL 2021

US MARKET

Michigan and Virginia – with others likely on the horizon – the opportunity for the American industry becomes even more compelling.

COVID-19 and state regulation of online sports betting With state-wide land-based casino closures and entry limits, operators were forced to reconcile a high fixedcost base with little to no revenue coming in the door.

Legislators in states like Virginia – which regulated online sports betting in September 2020 and launched its market this January – have likely seen the vulnerability of the land-based sector in the wake of the pandemic and been influenced by this, among other factors, to regulate the online sports betting and casino verticals.

As a result, land-based operators can monetise online gaming directly or at least indirectly. This leads us to three factors: first, hedging against pandemic effects; second, more data points that show online gaming is incremental rather than cannibalistic to retail casino activity; and third, neighboring states legalising online gaming, thereby draining the

IF THE SPORTS BETTING AND ONLINE GAMING INDUSTRY CAN THRIVE THROUGH THE WORST OF TIMES, WHAT ABOUT THE BEST OF TIMES? addressable market for tax revenues for not-yet-legal states.

A combination of these factors makes it likely that regulatory momentum will continue through 2021 and beyond. COVID-19 almost certainly acted as an accelerant to legalisation, but now the fundamentals and value opportunity for sports betting is too great to ignore.

Looking ahead Despite the war of attrition that 2020 presented, there are real reasons for optimism this year. Gaming products, business strategies, balance sheets, and legalisation momentum are all stronger due to the pandemic.

If the sports betting and online gaming industry can thrive through the worst of times, what about the best of times? In either case, we now have table tennis. •

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March Madness payouts

HIGHLIGHTING THE LEGAL PAYMENT AND PAYOUT OPTIONS ARE CRITICAL TO GAINING CUSTOMERS WHO MIGHT OTHERWISE CHOOSE ILLEGAL OFFSHORE OPTIONS

SIGHTLINE PAYMENTS: HOW PAYMENTS DRIVE ACQUISITION AND RETENTION GREAT ODDS, ATTRACTIVE PROMOTIONS AND CLEVER BONUSING are all essential

ingredients to attracting and retaining players, but how they get paid when they win is also a crucial part of the mix according to Sightline Payments CEO Joe Pappano

26 SBC LEADERS • APRIL 2021

US MARKET

A

s betting on March Madness, the NCAA National basketball tournament, swung into action earlier this month, SBC Leaders spoke with Joe Pappano - CEO of Sightline Payments - to learn more about his thoughts on the event and how payment policies can drive acquisition and retention.

Opening the conversation, Pappano noted: “March Madness is the most heavily wagered event of the year in the United States, with the American Gaming Association estimating that 47.4 million Americans will wager on this year’s tournament.

“As a big sports fan, I could not be happier to see the tournament return this year after being cancelled in 2020. Every sports betting operator is gearing up for a huge month with new promotions, customer acquisition campaigns, and odds boosts.”

He added: “There is mounting evidence that the most important criterion a customer uses in selecting their sportsbook – and stays there – is due to the operator's policies regarding payments. Payments policies also provide your consumer with a level of trust that their wagers will be paid out, unlike illegal offshore sportsbooks.”

Pappano referred to research conducted by the American Gaming Association, saying: “In the AGA’s 2020 Sports Betting Consumer research report, the biggest factor for customers to engage with legal sportsbooks was confidence in payouts, with nearly 70% of respondents saying payouts were ‘very influential’ in their decision.

Further, overall user experience and a positive experience with payouts were the top two considerations for respondents when selecting their operator of choice.”

Giving customers full transparency as to their legal options is another aspect that operators need to consider according to the CEO. “As you design your recruitment and retention strategies, highlighting the legal payment and payout options are critical to gaining customers who might otherwise choose illegal offshore options,” he said.

“The recent launch of Conscious Gaming’s Bettor Safe campaign is a

great step in the right direction in helping bettors understand not only the benefits of using legal books, but also which sportsbooks are legal in the first place.”

Pappano was also quick to emphasise the need for clarity on payout structures, adding: “Living in

FAR TOO OFTEN, PROMOTIONS NEGLECT TO MENTION THE PAYOUT STRUCTURE FOR WINNING WAGERS Ohio, I see a lot of ads from Indiana sportsbooks. This time of year, all of them have a variety of offers to engage patrons to sign up through various bonuses, risk free bets and other customer acquisition tools.

“Far too often, these promotions neglect to mention the payout structure for winning wagers. As Entain CFO Rob Wood stated recently, the

average customer has three or four apps on their phone, and the one they default to is the one they enjoy using most - usually due to the ease of use for handling deposits and withdrawals.

“At Sightline with the Play+ product, we work with nearly every sports betting and igaming company across the country to help them increase the efficiencies around deposits and withdrawals to better engage their customers.”

He continued: “While many think of Sightline as a ‘prepaid card’, the Play+ solution enables customers to deposit funds quicker and allows near instant access to their winnings through their Play+ card, which can then be used anywhere a Discover card is accepted.

Meaning, instead of having to wait to issue a check or an ACH, their funds can be transferred from their wagering account immediately to their Play+ card.”

Pappano believes that sports bettors are also more likely to shop around for bonus offers as opposed

sbcmagazine.com 27

March Madness payouts

to online casino focused customers.

He explained: “I attribute this to the seasonality of sports with different customers having different betting preferences based on time of the year and the bonus structure that follows those big events.

“Given the challenges that many sportsbooks had with the volume of wagers in the run-up to the Super Bowl, encouraging bettors to fund their accounts ahead of tip-off for each round of NCAA tournament games and placing their wagers shortly thereafter will bear fruit in an improved customer experience that would be free from latency issues and site malfunctions.

“As a result of the appeal of bonuses on customer recruitment, sports bettors have a higher likelihood of using more than one sports betting account regularly. With nearly a quarter of Play+ customers having more than one account, streamlining your withdrawal process

28 SBC LEADERS • APRIL 2021

US MARKET

is one way to differentiate yourself from your competitors.”

Pappano went on to highlight some of the staggering numbers around sports betting from the start of the year, and predicted that there is further growth to come.

“Many anticipate that March will be the single biggest month ever

IT IS NOT OUT OF THE REALM OF POSSIBILITY THAT THERE WILL BE $5BN WAGERED AT LEGAL SPORTSBOOKS IN MARCH for US sports betting,” he advised.

“In January, nearly $4.4 billion was wagered at sportsbooks across 19 states, which marked the sixth consecutive record breaking high for legal sports betting.

“It is not out of the realm of possibility that there will be $5 billion wagered at legal sportsbooks in March

with New Jersey becoming the first state ever to crack $1 billion in handle.”

The final piece of advice from Pappano is to ensure that payments solutions remain high on the agenda.

He stated: “Last December, Paysafe conducted a survey of US sports bettors and asked them to give their top three criteria for evaluating different sportsbooks they do not currently have an account with.

“Many would think that good odds or good promotions would be the leading reason. The top reason given at 37% - quick and easy payouts.

“So, while you run your traditional promotions around bonusing, think about how you can leverage your payments solutions to deliver what consumers really want – quick and hassle-free deposits and withdrawals.

It will provide you with the opportunity to not only recruit new players but retain them through a strategy that delivers on their top expectations around payments policies.” •

27-28 OCT 2021 CANCÚN, MEXICO

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A vaccine of education

MEXICO: THREE ONLINE GAMBLING MYTHS YOU SHOULD KNOW ALFREDO LAZCANO,

legal expert and Chair at Mexico City-based law firm Lazcano Sámano SC, analyses online gambling in Mexico and highlights three myths about the market

M

exico is a country rich in culture and full of opportunities, but also a complex and contrasting one. It is often very hard to understand how things work in this jurisdiction, even for Mexicans themselves, and that’s why we are aware that from the outside, certain practices might be perceived in a very different way than they actually are.

In addition, there are people who say that during the pandemic there is also an ‘infodemic’, so it’s always good to fight harmful misinformation with a vaccine of education and information.

In that sense, we want to take advantage of these lines to disprove what, in our opinion, are the three erroneous beliefs or myths about online gambling in Mexico.

MYTH 1: Online gambling is prohibited in Mexico Regarding the first myth, it’s important to contextualise this and talk about the legal gambling framework in Mexico. We have the Gambling Law from 1947. Yes, 1947. Around 57 years later, the Regulations of the Gambling Law were published, but they weren’t supposed to replace the Law, but to regulate it in detail.

It is worth mentioning that the Gambling Law has never been amended and that 2013 was the last time that the regulations were modified. Of course, due to the old

30 SBC LEADERS • APRIL 2021

DURING THE PANDEMIC THERE IS ALSO AN ‘INFODEMIC’, SO IT IS GOOD TO FIGHT HARMFUL MISINFORMATION WITH A VACCINE OF EDUCATION AND INFORMATION dates in these regulations, anyone could assume that online gambling is not legal, since at the time of the law’s creation, the internet didn’t even exist.

However, the Gaming Regulations expressly authorise “bets over the internet”. As we have said on more

than one occasion, although online gambling is not widely regulated as in other more mature jurisdictions, it is expressly, unequivocally and indisputably permitted. We will touch this subject later on.

Furthermore, we need to be aware

LATAM

that, as in other jurisdictions, the criteria established by the Gambling Regulator, the Ministry of the Interior (SEGOB), are also part of the legal framework that regulates gambling.

And certainly, SEGOB’s criteria regarding online operations have been fairly uniform - and above all, stable for almost two decades.

Even in the last two or three years, the largest and most recognised global brands have landed in the online Mexican market. With this trust and legal certainty, we’re seeing an increase in the number of sites authorised to offer online betting.

ALTHOUGH ONLINE GAMBLING IS NOT AS WIDELY REGULATED AS OTHER MORE MATURE JURISDICTIONS, IT IS EXPRESSLY, UNEQUIVOCALLY AND INDISPUTABLY PERMITTED

MYTH 2: Online gambling can only be authorised if it’s linked to a physical casino In relation to the second myth, in which people believe that online gambling can only be offered if there is also land-based operations involved, it is necessary to take into consideration what the Gambling Regulations say about online operations.

Indeed, Article 85 of the Gambling Regulations sets that “establishments may offer betting via the internet”.

Now, as it is clear in this article, these establishments have the power to offer bets on the internet, not to operate land-based casinos.

So is it correct to assume that the online operations must be linked to land-based ones? In our opinion, and based on the law, the answer is no.

According to the Gambling Regulations, we must define establishments as “open or closed spaces in which betting games or draws are carried out with permission granted by the Ministry of the Interior”.

IS IT CORRECT TO ASSUME THAT THE ONLINE OPERATIONS MUST BE LINKED TO LAND-BASED ONES? BASED ON THE LAW, THE ANSWER IS NO Now, if a location in which betting games are carried out has the modality of not being “open” to the public, it means that it’s a space where the players can’t physically go to place their bets. In that sense, and in strict legal logic, an establishment can refer to a physical casino.

However, a “closed” establishment can be understood simply as the server and/or data center of the licensee or authorised operator that develops online betting through a digital platform.

Nevertheless, it’s not necessary to lose ourselves in big words and legal interpretations. There are concrete examples to debunk this myth.

Indeed, currently there are

sbcmagazine.com 31

A vaccine of education

operations exclusively online in Mexico. Although in certain cases the formalities to authorise these operations complied with the initial legal requirements to have landbased operations, the truth is that today, these online operations are not linked or conditioned by SEGOB to the existence of a physical casino.

Undoubtedly, this is a reality that should not go unnoticed by those who mistakenly continue to believe that online gambling can only be carried out if physical operations exist.

MYTH 3: International online gambling operators can only offer their products in Mexico through a local partner Finally, in relation to the belief that the only way for foreign operators to enter the country is through an association or partnership with a local partner, we must say that, although this might be the most practical way, it is not the only alternative.

Even if the Gambling Regulations are very clear in stating that permits to carry out gambling activities

32 SBC LEADERS • APRIL 2021

LATAM

and draws may only be granted to Mexican people, whether physical or legal, the truth is that there are no limitations on international participation (they don’t exist in other laws on foreign investment either).

The only thing that a foreign online operator needs to do to be able to request a permit or license from SEGOB is to establish a Mexican company and comply with the other requirements established by the regulations, which for the most part are not that different from other countries.

This doesn’t mean that entering through a local partner is not feasible or recommended. It is not important to have a local partner, but it is important to find the right one.

Depending on the type of association and the conditions

IT IS EASY TO LOSE SIGHT OF THE FACT THAT HERE AND NOW, IN THE MEXICAN JURISDICTION, THERE ARE GREAT OPPORTUNITIES

IT IS NOT IMPORTANT TO HAVE A LOCAL PARTNER, BUT IT IS IMPORTANT TO FIND THE RIGHT ONE negotiated between the parties, most of the time entering the market with a local partner can represent lower costs and faster operations. However, the decision is exclusively up to the operator and the specific needs their business has.

Online gambling in Mexico is on the rise, it’s a market of nearly 130 million people, the second largest in Latin America, the largest Spanish-speaking country in the world, and currently in the process of maturing.

It is easy to lose sight of the fact that here and now, in the Mexican jurisdiction, there are great opportunities.

For this reason, we hope that these words are useful for those who had already ruled our Mexico as a possibility, and suggest that, perhaps, it would be a good idea to think twice. •

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The end of long-term planning?

PARIMATCH: TOP MARKETING TRENDS FOR BETTING IN 2021 PARIMATCH CHIEF MARKETING OFFICER IVAN LYASHENKO gives his

predictions about betting digital marketing trends and activities in 2021

T

he pandemic and associated quarantine periods changed lives in all areas, and betting was no exception. The quarantine measures in 2020 caused the complete closure of betting points and sped up the industry's full digitalisation, which continues into 2021.

Now, along with the gradual lifting of restrictions, sporting events have returned. As top European football matches and other sporting fixtures resumed, betting has naturally seen a significant uptick.

Companies are cautiously increasing their marketing budgets after the economic crisis to achieve higher volumes and access new advertising channels. Marketers are launching special projects - employing nonstandard formats and making bold decisions.

Despite overall industry losses over the last 12 months, one area has seen profitable growth - esports. About 30-40% of all bets placed during the quarantine period in the CIS market were on esports events.

Due to the rising popularity of esports, Parimatch is highlighting its development as one of the priority business areas reflected in the product, mobile applications, special promotions, and game mechanics for esports fans.

We’ve partnered with renowned esports clubs, while we also support amateur tournaments in various disciplines, organise our own

34 SBC LEADERS • APRIL 2021

professional leagues and create content for the esports community on social media.

TOP TRENDS FOR 2021 Continuing esports integration Yes, esports is the only segment that has grown during the pandemic.

Tournament broadcasts have regularly broken records in terms of reach and views: for example, international

esports competition organiser ESL reported a 113.2% increase in the audience of CS:GO tournaments compared to the previous season.

Because of their presence in esports, companies can reach a young audience, achieve a high engagement level and have constant contact with the tournament audience.

Betting companies will strengthen their presence in esports through tournament sponsorship, ambassador

MARKETING

signings and online integration – organising online events within the tournament framework that users can take part in and receive bonuses.

SMM trends for gambling Betting companies now realise that social media is one of the most valuable assets for audience engagement and not a place for boring branded images. The role of social networks will increase as part of the activation of sponsorship contracts: in fact, most of the interaction between companies and ambassadors will take place through social networks.

We also expect to see gamification in social networks through the launch of sweepstakes, games and other subscriber activities.

New affiliate partnership formats Historically, in the CIS, partnerships with affiliates have been built on personal relationships. During lockdown, amid a more general transition to online, relationships are evolving into a win-win partnership format with an increase in the price tag for services.

Changes in sponsorship packages Bans on betting advertising in the UK and similar restrictions in Spain and

ABOUT 30-40% OF ALL BETS PLACED DURING THE QUARANTINE PERIOD IN THE CIS MARKET WERE ON ESPORTS EVENTS Italy continue. Against the background of this ban on sponsorship of football teams in top championships, there will be an increase in media cost for inventory within the packages, but the cost of the packages will drop because of the reduction in the options to display advertising.

New betting marketing technologies The year 2020 showed that the industry no longer has time to swing: betting will master technology rapidly because doing so will result in savings on marketing. Marketing departments will apply fresh approaches everywhere: from automated media planning to anti-fraud precautions.

For example, where we previously tailored anti-fraud systems to billing operations, we now plan to use them in marketing to detect fraud much earlier in the conversion process.

Widespread development of SOI and DOI gambling purchase models In gambling, performance marketing

anti-fraud is relatively poorly developed, limiting the ability to purchase traffic by models other than CPA for FTD or Revenue Share.

Now, in most gambling companies, the conversion funnel looks like this: Registration → confirmation of registration → first deposit paying to affiliates → repeat deposit → customer who makes a profit

↙

↘

The development of marketing antifraud and traffic assessment models will expand purchasing models for leading affiliate programs.

Your conversion funnel will, instead, look like this:

↘

↙

Registration paying to affiliates → confirmation of registration → first deposit → repeat deposit → customer who makes a profit With innovative work on the funnel and the use of behavioural models of traffic estimation, it becomes possible - on one hand - to save the budget for an affiliate, while on the other to connect new websites from different high-risk niches.

2020 showed that long-term planning is losing the matchup with situational adaptability. Therefore, I advise everyone to be ready for the new realities of the industry and trends in digital marketing. •

sbcmagazine.com 35

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‘It’s All About Sports’

JAN MÖLLER: SPORTS FANS AT THE HEART OF ODDSPEDIA’S MARKETING MIX THE ODDSPEDIA CEO on providing the best value

proposition for sports fans and turning to traditional advertising instead of relying solely on digital channels

O

ddspedia was founded in 2014 by Jan Möller and his business partner Jeton Kodia, with the aim of providing valuable, competitive and user-friendly services for sports betting fans, players and publishers.

Since its inception, it has established itself as one of the biggest international affiliates in sports betting.

The company’s flagship product, Oddspedia.com, provides customers with a complete experience using real-time data and odds from operators around the world.

SBC Leaders spoke to Möller about providing a service which caters for the widest pool of sports fans, using geolocation to reach players with the right bookmakers and lead sports, stepping beyond digital advertising with Real Madrid, and what to expect from Oddspedia throughout the rest of 2021.

SBC: With sports events now largely resumed across the world, how are you meeting the demands of all different types of fans?

JM: Our primary goal is to be a valuable assistant for all sports fans. Up-andcoming punters can learn the basics with Oddspedia quite quickly. They can follow the sports they know well, understand the betting markets and master other sports betting essentials.

One of the key reasons is the clear way we display information to them

38 SBC LEADERS • APRIL 2021

WE REORDER SPORTS, LEAGUES AND MATCHES TO PROVIDE OUR USERS WITH THE MOST POPULAR AND INTERESTING INFORMATION BASED ON THEIR LOCATION - there are no complicated tables overloaded with numbers and colors or hard to grasp labels and buttons.

At the same time, experienced bettors utilise more advanced features like analysing the odds movement history, checking statistics and utilising betting tools to their advantage.

SBC: And what role does geolocation play when it comes to ensuring you’re reaching the ‘right type of player’?

JM: Unique geotargeting system, or showing the correct bookmakers for each locale, was only the first step for us - now we utilise deep content geotargeting. We reorder sports, leagues and matches in our system to provide our users with the most popular and interesting information based on their location.

OUR PRIMARY GOAL IS TO BE A VALUABLE ASSISTANT FOR ALL SPORTS FANS SBC: You recently signed an advertising partnership with Real Madrid. How will this agreement help you tap into new audiences across Europe?

JM: Yes, we are very excited about this! Oddspedia will be featured on the pitch side boards for some home games of Real Madrid, including the upcoming El Clásico on 11 April when Los Blancos meet Barcelona in one of the most exciting matches of the year.

We’re thrilled to have Oddspedia featured on the stadium and we certainly look forward to expanding these opportunities in the future. This

MARKETING

OUR UNIQUE GEO TARGETING SYSTEM WAS ONLY THE FIRST STEP FOR US NOW WE UTILISE DEEP CONTENT GEOTARGETING

sbcmagazine.com 39

‘It’s All About Sports’

MARKETING

AT THE HEART OF THE DECISION MAKING PROCESS BEHIND ODDSPEDIA'S MARKETING MIX REMAINS THE MOTTO ‘IT'S ALL ABOUT SPORTS’

also marks our first time we step beyond digital advertising, and I see it as a great way to kick-start 2021, with TV advertising being an additional platform to grow and engage our fanbase.

SBC: What prompted your shift towards more ‘traditional’ advertising methods?

JM: Recently, the Oddspedia brand as a whole has been enjoying a wider advertising push, such as with digital media campaigns on social media and YouTube. Now it is the turn for TV. Any person who loves any sports or supports their favourite team is our target client. Most of them only watch sports on TV, which in turn necessitates turning to TV as an advertising medium instead of solely relying on digital ads.

SBC: At last year’s SBC Awards, Oddspedia won the ‘Affiliate Product Innovation’ award. What did this mean for you? And why do you think you won this award?

JM: This was a very proud moment for the company, and the award has

40 SBC LEADERS • APRIL 2021

spurred us on to work even harder for 2021 and beyond! We are striving to be innovative in everything we do. As such, we’d like to take a moment to mention some of the innovations we’ve brought to our platforms: Our UI/UX design, unique geotargeting system and news selection by topic.

The next step is to build an awesome platform for sports community interaction.

as we are currently eyeing up the opportunity to secure a licence and enter that market as an affiliate.

The affiliate channel has proved over time that it is a cost effective way to connect brands to target market customers. Affiliates help operators win the battle for players with increased brand exposure, attracting specific audiences and cultivating lifetime value customers.

THE ODDSPEDIA BRAND HAS BEEN ENJOYING A WIDER ADVERTISING PUSH THROUGH DIGITAL CAMPAIGNS ON SOCIAL MEDIA AND YOUTUBE. NOW IT IS THE TURN FOR TV SBC: Looking forward to the remainder of 2021, what can we expect from Oddspedia?

JM: We have huge plans and a roadmap on how to grow within our niche. With the launching of a new version of Oddspedia.com, we now actively cover sports, news and betting sections which will attract sports fans from around the world.

The US market is the next step,

Given that the market is so overcrowded and there’s plenty of competitors, it’s very important to each affiliate to be able to stand out and provide unique features, which is exactly what Oddspedia aims to do.

At the heart of the decision making process behind Oddspedia’s marketing mix remains the motto ‘It’s All About Sports’. The most important centerpiece is the product. •

Thinking outside the box

‘MORE THAN A BETTING BRAND’: HOW ITALIAN OPERATORS ARE EVOLVING THE SPORTS MEDIA LANDSCAPE WITH RESTRICTIONS ON GAMBLING ADVERTISING IN ITALY TIGHTENING, betting companies have been

forced to undertake a fresh strategy to marketing, reshaping themselves as ‘media brands’ to maximise consumer engagement

I

n July 2019, the Italian communications authority introduced the Dignity Decree, which prohibited all sports leagues and clubs from promoting and advertising gambling-related brands.

However, in April last year, a plea was issued to the government by

42 SBC LEADERS • APRIL 2021

Italian sport leaders to restore betting advertising for 12 months in order to support professional leagues, sports clubs and athletes through the COVID-19 crisis, which has cost Italian football clubs €100 million in lost sponsorship and broadcast opportunities.

Speaking at SBC Digital - Italy on

the ‘marketing and advertising under tightening restrictions’ panel, Shaun Simmonds, Managing Director of Superstar Digital, explained how sports federations and clubs were driven to ‘enforced evolution’ when the ban was implemented to find a way around the restrictions.

“We felt that a lot of our marketing channels and opportunities were being taken away from us. But since then, that has inspired creativity and there has been an enforced evolution in the way that we’ve approached it from a marketing aspect,” he argued. “A lot of the research we’ve done has shown there’s obviously been a huge shift

Shaun Simmond Managing Director o Superstar Digital

ds, g of r

MARKETING

Pietro Lechiara, Managing Director of Betsson Group in Italy

Shaun Simmonds, Managing Director of Superstar Digital

IT HAS INSPIRED CREATIVITY AND THERE HAS BEEN AN ENFORCED EVOLUTION IN THE WAY THAT WE'VE APPROACHED IT FROM A MARKETING ASPECT towards online from retail, and that’s been generated by the pandemic.

“There are sports news websites that we’ve seen emerging, so StarCasino.

Sport, for example, and I’ve been involved in something very similar with SportPesa as well in terms of sports news. So, I think that’s where we’re seeing this evolution.”

With more gambling firms recognising the importance of marketing their companies as ‘more than just a betting brand’, Simmonds highlighted how companies have transformed their brands into ‘lifestyle’ oriented websites, bringing fans and users sports news as well as betting news, and focusing on the ‘infotainment’ aspect of the business.

The former Marathonbet employee also likened StarCasino and other

Italian betting brands to LiveScore in the UK, which has since expanded its portfolio and moved away from standalone betting products.

He continued: “I think something that quite kind of stood out to me was a meeting I had the best part of 10 years ago when I was at Marathonbet. Our then-CEO said the way that legislation was evolving - not just throughout Europe but throughout a lot of the kind of grey markets and in Latin America as well - it’s going to be the more lifestyle brands that are successful.

And I think we’re slowly seeing the evolution of a lot of online betting brands, where they’re seeing value in offering other services.”

Pietro Lechiara, Managing Director of Betsson Group in Italy, echoed Simmonds’ thoughts, recalling how the company was forced to begin thinking ‘outside of the box’ in the aftermath of the advertising ban. He cited StarCasino’s new StarCasino.sport portal, which the firm launched as an alternative to the operator brand. The platform generates exclusive content which Lechiara insisted was pivotal to keeping the brand alive.

“We launched a new line of businesses which are informative websites or social apps,” Lechiara remarked. “At Betsson, when the ban on advertising arrived, we started analysing our strengths and we have always been a customer centric brand with the ability to provide valuable content to our customers. We didn’t want everything we built up to be lost.

“So, we created a new company called StarCasino Entertainment. This is the company where we launched every new project related to non-gambling businesses. StarCasino.Sport and StarCasino Gratis are the two examples that we have successfully launched in the latest year.”

THE BEST PART OF 10 YEARS AGO, OUR THEN-CEO SAID THE WAY THAT LEGISLATION WAS EVOLVING WAS THAT IT'S GOING TO BE THE MORE LIFESTYLE BRANDS THAT ARE SUCCESSFUL

sbcmagazine.com 43

Thinking outside the box The betting brand, which has agreements with top flight Serie A outfits including Napoli, Inter Milan and AC Milan, has been tapped by a handful of sports clubs to boost fan engagement, offering supporters ‘a new way to experience’ their favourite team.

“We put a lot of effort to create something unique and something that is not in the market. We coined the ‘media of sports entertainment’. We don’t just create websites where we publish news and the latest news about sports or some articles about sport, we are making something different. We are creating exclusive content, especially videos.

He added: “We are making a platform of entertainment about sports with a lot of interaction between the supporters, and the protagonist of the sports like journalists and influencers.”

Moreover, viewing the advertising ban as an ‘opportunity rather than a threat’ has been key to navigating the ever-tightening restrictions, according to Giovanni Bertoli, Chief Executive Officer at Wall Street Football.

The panelist discussed how the gambling industry has merged with the entertainment sector and become more engagement focused, integrating new features to retain sports fans’ attention and spread their brand through simple ‘word of mouth’.

He said: “This is a great example of how this regulation basically brought us creativity in solutions that perhaps the industry would have not reached without this problem. I think in this case the topic is the connection between gambling industry, entertainment in general and user engagement.

44 SBC LEADERS • APRIL 2021

MARKETING

Giovanni Bertoli, Chief Executive Officer at Wall Street Football

THE REGULATION BASICALLY BROUGHT US CREATIVITY IN SOLUTIONS THAT PERHAPS THE INDUSTRY WOULD HAVE NOT REACHED WITHOUT THIS PROBLEM “Before this law, there had been a lot of attention toward just advertising and marketing because the playing field where operators were competing was just the user acquisition based on advertising, whereas now it’s probably all about engaging the user. The money and the time that was before invested in advertising is now invested - or should be invested - in product innovation and

in the creation of new solutions.”

Bertoli explained how the ban has created a ‘race at the top’ in the country, with operators competing to have the most regulated market, but fan engagement remains at the heart of the contest now.

“A user that is engaged is a user that is going to speak about your platform to other users, and basically, this is word of mouth, which is a type of advertising which is legal and which is free as well. And when you do a new type of solution that is more engaging, you earn word of mouth.”

Looking to the future of the increasingly intertwining sports betting and entertainment industries, Lechiara asserted that operators are already equipped with the tools to work around the advertising ban but should be prepared to be ‘more open to innovation’.

“Our goal in the market is to grow as a casino operator, but we also aim to run these numericals that we have launched. I think that all these new verticals that we have launched drove more value to the previous one and also more credibility because they reinforce the overall position of a fantastic provider of services.

“In our industry, there are a lot of talented people with expertise to be focused only on what we are doing.

We need to think about innovation because we have skills to do it, and I think that this is what we are going to do in the future.” •

The changing world of slots

WILL ONLINE SLOTS BECOME A LOW-STAKE ENTERTAINMENTLED ECOSYSTEM? AS THE LANDSCAPE OF THE ONLINE GAMING MARKET

continually shifts, the most notable development in recent times is that of a responsible gaming nature, with the lowering of stakes in the slots ecosystem one crucial talking point 46 SBC LEADERS • APRIL 2021

E

ntertainment is front and centre of so many igaming conversations, particularly with the ever-increasing regulatory microscope that the industry currently finds itself under.

With this in mind, could slots, in particular, become a more low-stake entertainment led vertical?

However, should this be the case, would any sacrifices have to be made - particularly with regards to design principles - and what role will the ever increasing volume of snackable content have in the makeup of a more regulated environment?

James Marshall, CEO of Push Gaming, picked up the debate by noting an air of inevitability but issuing a slight note of caution: “It’s getting to the point where it’s going to have to,”he said. “Longer term, I certainly see slots becoming a low stake, higher volume

CASINO

James Marshall, CEO of Push Gaming,

build the player base.

“To compete on a larger scale in terms of player numbers, the industry needs to become more socially acceptable. We’ll then see the effect of that, allowing for more ads and the industry being more visible, but also, even more powerful, word of mouth.”

type of product simply for it to be sustainable.

“If, as many have done in recent times, we compare it to something like Netflix - roughly £10 a month is considered to be a manageable investment for the entertainment provided. So, from a slots perspective, if we can achieve a higher volume of players with less reliance on VIPs over time, it makes sense. This will allow us to compete with the other forms of entertainment out there to capture a bigger audience.

“The real challenge though is going to be capturing that high player volume. Regulations are already dictating slower gameplay, with lower stakes likely to come along soon.

There’s also the whistle to whistle bans on TV ads, bonusing and promotions essentially being shut down in some markets, so we have to consider how to capture the bigger audience and

Issuing a slight disagreement was Ondrej Lapides, CEO of Tom Horn Gaming, who asserted that a balance approach is key, and that operators and providers must adjust to the changing regulatory climate if they want to survive.

“In recent months many jurisdictions including the UK, Sweden and Germany have introduced proposals for further regulatory changes on online gambling - temporary or permanent,” he said.

“Generally, regulators have good intentions and introduce these measures to protect players.

On the other hand, with the economy crippled by the pandemic, stringent regulatory measures are also impacted by more complex recovery plans governments embrace in order to offset the economic consequences of 2020.

LONGER TERM, I CERTAINLY SEE SLOTS BECOMING A LOW STAKE, HIGHER VOLUME TYPE OF PRODUCT SIMPLY FOR IT TO BE SUSTAINABLE

“Either way, there has been a growing appetite for sweeping reform of the gambling industry. It started with the casino segment and I’m sure similar restrictions are not going away and will likely impact all verticals such as sports betting, horse race betting, poker, or virtual sports.

“The maximum stake limit is only one part of the equation. However, as such it might have far-reaching implications for the future of our beloved industry with online casino games likely to be stuck with the label of ‘low-stake entertainment’ sector.”

Lapides added: “It is important to reiterate that tighter regulations must strike the right balance between protecting the vulnerable, while not spoiling the enjoyment of millions of people who play online casino games on a regular basis in a safe manner and driving them into the arms of the online black market.

“The latter is especially quite worrying as it will cause more harm to the perception of the industry in the long run.”

As regulators impose extra restrictions in the digital makeup of igaming, would it be fair to suggest as it has previously in certain quarters - that a wider-mass appeal but with a lower expenditure per individual, is the way that the industry is, or should be, heading?

Should that be the case, what changes would be necessary in such a competitive marketplace, and - as

sbcmagazine.com 47

The changing world of slots

previously alluded to - would any components of the development process have to be forfeited to achieve such an outcome?

“Limiting online casino stakes won’t necessarily lead to gaming having a mass appeal to a wider population,” continued Lapides. “The reason why players enjoy playing online slots is the variety of options, including bet values, slot games offer.

CASINO

Ondrej Lapides, CEO of Tom Horn Gaming

AS AN INDUSTRY WE WILL HAVE TO TAKE A FAR MORE FACETED AND COMPLEX APPROACH TO GAME DEVELOPMENT “Some favour low stakes, others find excitement in the thrill of wagering big amounts of money potentially leading to proportionally higher winnings. The beauty of online casino entertainment now is its diversity and the option to adjust the course of play to one’s circumstances, including a player’s salary or personal taste and preference.

“Enforcing limits on the amounts players are allowed to gamble on online slot games is likely to see a decline in players as many of them, especially so-called high rollers, will no longer consider games with the lower stakes entertaining and will look elsewhere.

“In order to retain players in different markets providers will have to differentiate their game development to comply with a number of measures.

We will witness the rise of bespoke games supplying markets with tougher regulations such as the UK, whilst at the same time we will be prepping these same games for less ‘restrictive’ markets without depriving players of the full player experience.

“I believe the industry will be able to stay sustainable through further strengthening their ranges of products and new verticals, whilst ensuring these are rolled out responsibly and adhere to national gambling regulations.

“As an industry we will have to take a far more faceted and complex approach to game development.

For online casino games to remain the source of entertainment and enjoyment, we will have to look further afield to implement tools and solutions that will curb problem gambling.

Transparency and accountability will

48 SBC LEADERS • APRIL 2021

be essential for the future of the industry.”

Marshall concluded by touching upon some of the potential challenges that lie ahead. “It is going that way, regulators are pushing for that, and the industry will become more sustainable long term, which of course is great, but this will bring challenges for game design,” he said.

“Thinking about other forms of entertainment such as mobile games, you have low spend, a small one-off cost to purchase or in-game purchases and that’s a key area we’re competing against.

“In terms of design; speed and pace are incredibly important to how

FINDING THAT BALANCE WHERE PRODUCTS ARE SAFE, RESPONSIBLE, ENTERTAINING AND COMMERCIALLY VIABLE IS ABSOLUTELY KEY

we entertain users - you can even have a lower stake game and that’s fine, but this means the income is lower and if you start slowing games down, ultimately it’s going to affect engagement - it’s a huge risk to sustainability. Timing and pace are vital in capturing your audience and these are the sorts of potential sacrifices we’re very much aware of as a studio.

“It’s our job to look at the regulatory environment and work out how we can make something fun while reducing the pace of the game – as well as maintaining the level of engagement on lower stakes. The risk is losing players to other forms of entertainment as a result, or they leave the regulated space altogether to find faster, alternative games without restrictions.

“Finding that right balance is absolutely key; safe, responsible products that are entertaining and are commercially viable and we’re confident we can achieve that.” •

Pursuing the American Dream

JEFF MILLAR: WHY THE US HAS BECOME THE TOP PRIORITY FOR NETENT JEFF MILLAR, Commercial

Director of North America at Evolution, reflects on the company’s longawaited US entry, the long-term potential of the market and the crucial roadmap that lies ahead

T

he US market has been high on the agenda for many since the repeal of PASPA back in 2018, and Evolution Group is no exception, having previously dubbed America as “an absolute priority market”.

Michigan has become the latest state on the brand’s radar as it continues to expand stateside. Since entering the Great Lake State on 22 January 2021 following the launch of the region’s online gaming and sports betting market, Evolution looks poised for further growth.

Following this development, Jeff Millar - Commercial Director of North America at Evolution - explained that the igaming supplier already has plans to add a live casino broadcast studio in Michigan, its third in the US after New Jersey and Pennsylvania.

SBC: Michigan finally made its longawaited digital debut in January, why was the region considered such a priority for the group?

JM: The US has become NetEnt’s primary market in terms of commercial

THERE’S A LOT OF EXCITEMENT IN THE STATE AND THE CONSENSUS IS THAT THERE’S PLENTY OF GROWTH IN THE MARKET

50 SBC LEADERS • APRIL 2021

revenues. This has been driven by the momentum of new states opening; by the time they go live we have already spent many months – and often years – planning for that first day of trading.

Clearly, a populous state like Michigan is going to make it a priority.

With approximately 10 million residents, an established landgaming operator infrastructure and player base, there’s a large potential audience that can be reached quickly.

Additionally, Michigan has fair tax rates and licence fees, a well-established and respected regulatory environment, and the opportunity to work with both commercial and tribal operators.

SBC: The jurisdiction’s 10-day launch window in January brought record results, with its digital gambling debut going from strength to strength in the following month. What do you

WE EXPECT THE MARKET TO CONTINUE TO GROW AS RESIDENTS IN MICHIGAN BECOME AWARE THAT ONLINE CASINO GAMING IS NOW PERMITTED BY LAW AND REGULATED envisage is the longer term potential for Michigan?

JM: The volumes during that window show how keenly-anticipated the launch was. A couple of months on and those numbers are holding firm. There’s a lot of excitement in the state and the consensus is that there’s plenty of growth in the market. As it becomes better established this will be met with a wider range of games, product types and exclusive launches.

We expect the market to continue to

CASINO

go live with a selection of our greatest hits and games that are tailored more towards land-based players exploring the added features and functionality of online slots.

This year our sensational Megaways titles have debuted in the US. They have been instant successes and are a key element of our rollout strategy across Michigan, New Jersey, Pennsylvania and West Virginia.

IS THERE ANYONE WHO DOESN’T RECOGNISE THE US AS THE PRINCIPAL OPPORTUNITY?

grow as residents in Michigan become aware that online casino gaming is now permitted by law and regulated. Most Americans still presume online gaming is an unlawful activity.

For newly regulated markets like Michigan, it does take some time for consumers to realise they can now play legally, on a regulated website or mobile app. With this in mind, we view Michigan as having plenty of runway for growth as player fears subside and they become more comfortable with the technology.

adapt our service offering to individual customers and markets. Michigan has its own ways of working and we’ve proven that we’ve been able to adapt to that and capitalise on the earlystage hype.

SBC: What major lessons have been learned in the early going?

JM: The most immediate observation – as seen from those initial results – is that everyone’s faith in the market has been justified. NetEnt has been built on flexibility and cooperation so we’re constantly looking for learnings to

THE MOST IMMEDIATE OBSERVATION – AS SEEN FROM THOSE INITIAL RESULTS – IS THAT EVERYONE’S FAITH IN THE MARKET HAS BEEN JUSTIFIED

SBC: A roadmap of high-profile game launches across all markets was pledged upon making the Michigan entry, and while we may have seen the first stages of this, could you tell us more?

JM: In Michigan, the first step was to

Every state has its own bespoke roadmap of NetEnt game releases, but our overriding aim is to deliver the hottest titles to as many markets in the quickest possible time. The regulatory frameworks of a market will impact on how quickly a game can be certified and this is especially the case for less mature ones.

In addition to more NetEnt game releases, we will also have games from our Red Tiger portfolio and of course, our live casino games. Both should be available later this year. Our new live casino studio is being built just outside the city of Detroit in Michigan.

Live casino is always a welcome surprise to American players. Many players have never been exposed to our video-streaming, live casino technology. Players are simply amazed that they are playing against real casino dealers, just as they would in a land-based casino.

SBC: The US has always been considered a high priority for the group, what further developments do you envisage as we proceed through 2021?

JM: Is there anyone in this industry who doesn’t recognise the US as the principal opportunity? The year ahead will see us do what we do best – create and launch great games with the leading operators.

We expect more states to pass legislation for online casino gaming.

There are already many states that have passed laws for sports betting, including remote sports betting over the internet. This is usually the first step to allowing online casino gaming as well. •

sbcmagazine.com 51

Slot of the Week Winners

Tom Horn Gaming

Wheel of Luck.

Hold & Win Basic Info: During the base game, if the player lands three Scatter symbols, it triggers 10 Free Spins. Moreover, if five Wheel symbols land on the reels within this mode, then players get to advance into the Hold&Win respin where Cash and Wheel symbols enhance the players’ win potential.

When appearing on the reels, Cash symbols remain fixed on the reels for the duration of Free Spins and reset the spin count to three. The suspense builds with every Wheel symbol landing on the grid as they are the ones

Reels: 3x5 Paylines: 25 RTP: 94.097% Volatility: Medium to high Key Features: Free Spins, Hold&Win respins and Wheel of Luck bonus round

to watch out for to get to spin the Wheel of Luck.

After securing three Wheels, players have one chance to spin the wheel. Its three levels take this bonus game up a notch, with each ring on the wheel presenting players with higher winnings. When reaching the top level, players can maximise their winnings by 1000x their bet.

Ondrej Lapides, CEO at Tom Horn Gaming, noted: “We constantly look for ways to enhance our content offering. In 2021 we plan to deliver more fun and a variety of slots with thrilling features to engage and excite players in different markets.

“Wheel of Luck. Hold&Win is the first in line of many unique titles we have in the pipeline. We’re positive the game’s features, dynamic gameplay and wellknown theme will resonate with players, keeping them entertained and immersed throughout the game.”

SG Digital

Rainbow Riches Race Day Basic Info: During the base game, when one or more winning combinations land, winning symbols will explode with new symbols taking their place.

If players land four or more Scatter symbols, it will trigger the Free Spins feature. Landing a Horse symbol on the reels will contribute to the Horses feature.

Above the reels are five horses, each with an associated pot. When one of these horses appears on the reels, that horse will move forward on the track.

Reels: 6x4 Paylines: 4,096 RTP: 96.25% Volatility: High Key Features: Free Spins, Horse Reel and Multiplier

When a horse reaches the pot, that prize is awarded to the player. If multiple horses reach their respective pots on the same cascade then both prizes are awarded.

During the free spins round, each pot will start with a value equal to x10 stake. The player can distribute another 90x stake to the pots before the Free Spins start.

Rob Procter, content specialist director, digital at Scientific Games, added: “Rainbow Riches Race Day marks another stellar addition to our portfolio this year and offers a unique gameplay that evolves the Rainbow Riches franchise to a new level.

“Those familiar with horse racing arcade machines will appreciate the way in which we’ve incorporated the format into the game, while for Rainbow Riches fans there’s a new concept to experience that includes all the iconic characteristics they love.

“We believe Rainbow Riches Race Day will appeal to a wide audience and prove to be a huge hit with players.”

52 SBC LEADERS • APRIL 2021

CASINO

BGaming

Four Lucky Diamonds Basic Info: Only available during the bonus round, the Wild symbol substitutes any symbol in a line to complete a winning combination. Furthermore, within the Lucky Spins mode, four playable reels become available in case the wins in the main game reach the fourfold size of the bet (or higher).

Moreover, the Stacked Wilds, which are only available in the bonus round, can appear on the third central reel.

Reels: 5x3 Paylines: 10 RTP: 94% Volatility: Medium to high Key Features: Lucky Spins mode and Stacked Wilds

Stacked Wilds helps to complete winning combinations by substituting other symbols on the reels, increasing the players' chances of winning.

Additionally, if Stacked Wilds appear on one of the four bonus reels, they are duplicated on the subsequent reels.

Yulia Aliakseyeva, the project manager at BGaming, noted: “It’s the first time for BGaming to use gemstone symbols in its slots. We wanted to make something traditional but with a special charm. The game has bright and attractive visual and sound effects.

“Besides great features like Lucky Spins, there is also a very interesting detail in the slot. A player can see possible winning combinations before the reels completely stop.”

Kalamba Games

Agent 51

Basic Info: Every 10 base game spins, players accumulate special character symbols. Selected symbols then turn into Special Expanding symbols. These expand to cover all three positions on the reel and pay for any on selected lines.

If players hit the UFOs in the Free Spins game, they will be awarded additional Free Spins and a chance of higher wins. Furthermore, players can go straight to the Free Spins game through the HyperBonus.

Reels: 5x3 Paylines: 20 RTP: 96.17% Volatility: High Key Features: K-Loop and Free Spins mode

Alex Cohen, COO and co-founder of Kalamba Games, commented on the launch: “Agent 51 is a galaxy of fun – our much-loved features and the cool, classic theme makes for an amazing new sci-fi thriller.

“It promises to be an exciting launch and players will be able to indulge themselves in an innovative gaming experience while hunting elusive aliens. The loot is out there.”

sbcmagazine.com 53

Slot of the Week Winners

SG Digital

Spartacus Super Colossal Reels

Basic Info: The Super Colossal Reels mechanic takes the excitement to the next level featuring a 5 x 4 grid, as well as a Super Colossal 5 x 12 set where reel five is double the size and includes multiplier symbols.

Before the reel spin initiates, some Spartacus symbols on reels one to four of the main reel may be replaced with Super Spartacus symbols.

A respin is awarded whenever a Super Spartacus Wild Transfer occurs. The originating spin is Reels: 5x4 reel set as as evaluated, and Super well as a Super Colossal Spartacus symbols 5x12 grid become Spartacus and Paylines: 100 are held in place for RTP: 96.75% one respin.

Volatility: Medium to high Mega Wilds are Key Features: Super oversized Spartacus Spartacus symbols, Wild Transfer, Mega Wild, Wild or Super Spartacus Multiplier and Free Spins symbols that are two reels in width. Before

the reel spin commences, Mega Wild symbols may spin over two adjacent reels on one to four of the main reel set. Mega Wilds observe the same rules as normal Wilds in regard to transfers and respins.

In the Base Game, if a combination of Gold Mega Wilds and Spartacus symbols cover the whole reel on the main set, an entire reel of Spartacus symbols is transferred to the corresponding reel on the Super Colossal.

If an entire reel of Spartacus symbol or Super Spartacus symbol appears on the main set, an entire reel of the same symbol is transferred to the corresponding reel on the Super Colossal. Wild Transfers will not cover Wild multipliers.

Finally, three or more Colosseum Scatters trigger the Free Spins bonus, these only appear on reels one, three, and five of each set which can award up to 20 Free Spins.

Spinmatic

World of Gods - Niflheim Basic Info: As part of the game, the Hel symbol is the stacked Wild symbol. She appears fully or partially on the screen. When appearing as a full symbol, she awards the player two random Wilds.

Moreover, when all five Rune symbols appear anywhere on the screen at the same time, the Bonus game is triggered. This round consists of 15 undefined runes which the player chooses at random. When three of the same Rune symbols are found, Free Spins are Reels: 5x3 rewarded, depending RTP: 96.33% on the Runes.

Volatility: Medium to high Additionally, the Jera Key Features: Stacked Free Spins can occur, Wild, five Free Spin which guarantees rounds, Random Wilds, Wild Nudges and Sticky random Wilds. During Wilds this mode, the Hel symbol turns into a

54 SBC LEADERS • APRIL 2021

Wild and nudges down or up while giving two Wilds.

Furthermore, during the Ansuz Free Spins round, low paying symbols are dropped from the reels.

If that wasn’t enough, the title also comes with a Dagaz Free Spins feature. Once activated, all low paying symbols turn into its corresponding high paying symbol.

The Tiwaz Free Spins mode includes multipliers. In each round, if a win occurs then it is multiplied. Each winning round multiplier is increased by one.

The final Free Spins round is the Perthro Free Spins.

During this mode, the Hel symbol becomes Wild and stays sticky in the third reel. Further random Wilds may appear during spins.

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Crypto control

SCOTT MORGAN: THE PANDEMIC HAS RESHAPED THE USE OF CRYPTOCURRENCY THE IMPORTANCE OF CRYPTOCURRENCY has evolved as global economies have had to adapt to the COVID-19 pandemic explained Scott Morgan - a blockchain consultant and entrepreneur, as well as the Founder and CEO of Crypto Integrity Tao SBC: Can you just explain why you think the pandemic has reshaped the climate for cryptocurrency?

SM: Crypto Integrity Tao actually took analysis to a new level by delivering 1,900 pages in six books correlating technology with other sciences like physics to realise the true potential of blockchain. This level of analysis also

56 SBC LEADERS • APRIL 2021

revealed the many limitations, dangers, and flaws in current blockchain categories.

The pandemic accelerated both blockchain DLT and cryptocurrencies by translating fear, doubt over governance, balkanisation, and monetary policy into innovation and risk-taking in an asset class that

exploded in value. Some transfer of wealth into cryptocurrencies from traditional investment comes down to established financial systems’ refusal to innovate, with ripple taking future revenue from the SWIFT system.

Warning signs like banks limiting withdrawals urged wealthy people to transfer money to systems less directly controlled by governments.

And then comes the actual thrill and pride people felt when investing in cryptocurrency; as the world swamped the spirit in people, cryptocurrency was the lifeboat sent to rescue them. In a phrase, cryptocurrency gave people a feeling of control over their lives and meaning for their futures.

SBC: What role can blockchain play in helping the entertainment industry’s recovery?

SM: For seven years, famous leaders in Hollywood exclaimed that Hollywood was not just sick, it was sick of itself.

The art was dying due to unethical practices by studios and agents, highlighted by the WGA war with agencies.

Blockchain DLT comes to the rescue by delivering a complete solution to inflated budgets, restricted access to high-value original content, erasing advertising fraud that can be as high as $40 million for a single movie, and

PAYMENTS

SM: Blockchain DLT and in-game tokens solve two of the biggest problems in gaming: cheating/bribery and how to transfer money or assets that winners hold in games into currency in the real world. TRON and CEL are the only two networks set up to maximise the interoperable aspects of tokens.

TRON delivers through Justin Sun’s JUST technology and BitTorrent – instantly solving advertising fraud.

TRON also solves issues gamers needed to be resolved as they take the lead in the gamification of finance, health, politics, defence, education and more.

CRYPTOCURRENCY GAVE PEOPLE A FEELING OF CONTROL OVER THEIR LIVES AND MEANING FOR THEIR FUTURES

piracy fought with self-executing penalties through smart contracts.

However, this requires the studio and production to integrate blockchain from development through distribution.

The only players who know how to integrate blockchain, tokens and games into the entire entertainment sector are Creativity First Films and directors like Christopher Nolan.

Once achieved, this makes entertainment the ultimate tech investment, delivering 3,000-10,000% on investment over five years, which cannot be matched in any other investment sector over such a broad asset platform. Film investment will pull blockchain with it and blockchain will

BLOCKCHAIN DLT AND IN-GAME TOKENS SOLVE TWO OF GAMING’S BIGGEST PROBLEMS: CHEATING AND HOW TO TRANSFER MONEY HELD IN GAMES INTO CURRENCY IN THE REAL WORLD prove so valuable it pulls even more tech investment into film – where 2021’s streams of revenue all originate.

SBC: Has the pandemic altered the gaming sector’s relationship with cryptocurrency?

Creativity First Films plans to use TRON’s network and a TRON token/ crypto for Asia and most of the world; however, CEL is prime for the Western Market. Tencent can be the base as the secondary game finance interplay system for China. The current trade and technology issues between the US and China proves what Crypto-Integrity-Tao predicted way back in 2017-18: that games, film and blockchain innovation must remain independent from politics.

People forced to stay home injected previously unimaginable profits and stock valuation to the key players in games: Tencent, Microsoft, Apple, Epic, Google, etc. The Azure Cloud almost froze in February, 2020 as so many new players joined. Even when banned in the US and India, the top Chinese game made over $200 million in one month.

These gamers are here to stay. So are the app addicts on TikTok. That alone is enough to push global hedge funds into games, especially if the future games are fully integrated into the broader entertainment industry in a vertical model.

SBC: Can you tell us more about which markets and sectors have been faster adopters of cryptocurrency since the pandemic?

SM: The pandemic put a spotlight on cryptocurrency – then threw gasoline on the fire of distrust in fiat currency, old financial models, and central

sbcmagazine.com 57

Crypto control

bank/government policy that seems to disregard industries that feed the risked money that makes governments possible.

Naturally, financial investors and key banks like Chase got the justified proof that their years of work on cryptocurrency were worth it. Gemini did a terrific job of proving a major exchange can lead the pack and please the S.E.C. at the same time.

This led to some sage permissions by the S.E.C. to institutional investment.

Following the rules allowed grayscale to become the ‘King Kong’ it is now.

However, to be honest in an arena that echoes only endless good news – DeFi and CBOE are inches away from opening a Pandora’s Box of manipulation, lawsuits, and bad brand for cryptocurrencies if they do not put both institutional security and main street/retail security above profits from derivatives, synthetics and the same practices that led to the 2007/8 crash.

If these Pandora’s don’t poison the well, the IRS with retroactive punishing taxation will punish the leaders in these two markets. This fact proves it is time for the hype-leaders to step back and let wise minds act as a governor on the throttle of cryptocurrency’s race to a secure and stable investment.

After the financial sector, the fastest movers were in the gaming arena.

Wise innovators realised that to ‘scale’ cryptocurrency they should jump into

58 SBC LEADERS • APRIL 2021

PAYMENTS

the games market. But what most experts fail to understand is that ‘scale’ requires ‘spirit’ and that spirit is influenced by the culture of each nation slightly differently. This is not a one size fits all future and this is why Crypto Integrity Tao blended Eastern and Western philosophy, monetary policies from the world’s top economies.

ULTIMATELY, TELECOMS AND COMMUNICATION NETWORKS INCLUDING SOCIAL MEDIA WILL BE THE NEXT INDUSTRY TO RECEIVE THE INCREDIBLE BOOST THAT CRYPTOCURRENCY CAN PROVIDE The prerequisite was to study cultural differences in China, the Middle East, Europe, Singapore, Japan, Switzerland, India, and the US. Nothing in our universe lasts long if not in balance – cryptocurrency has the potential to balance all of this for the first time in the investment arenas if but only if it honors the drive of multiple cultures.

Ultimately, telecoms and communication networks including social media will be the next industry to receive the incredible boost that cryptocurrency can provide. It will also justify upgrades to 5G as well as adoption of and adaptation

to the higher degree of personal responsibility that comes with cryptocurrency.

After all, without a third party, there is no government or insurance and sometimes not even laws to protect a person’s investment or trust in a platform or network.

SBC: And just finally, financial inclusion has been a key theme of the pandemic, how can cryptocurrency help increase this?

SM: The easiest positive examples of financial inclusion are PayPal as the old school model interfacing with cryptocurrencies. This is fine and delivers a degree of inclusion because just about everyone can access PayPal. DeFi also offers inclusion, but with undiscussed unforeseen consequences like future lawsuits, lost keys and overhyped valuation due to tokenisation of a purchase, such as art or real estate.

One of the unsung heroic divisions of Blockchain is the use of DLT in health, tracking the pandemic, and ushering in a less-fraud-inflicted system for delivering a stimulus to citizens.

Here, decentralisation proved to be inclusive across many sectors, not just of people but of business systems.

Cryptocurrencies and tokens can greatly help in any future pandemic due to the attention on it now from this pandemic. •

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The broader vision

TRUSTLY IS COMMITTED TO PROVIDING VALUE BEYOND PAYMENTS LIAM COLCLOUGH SHARES DETAILS of an exciting

Open Banking partnership for Trustly, as well as why it is committed to providing the most sustainable way to pay and how it is supporting merchants and operators beyond payments technology

I

f you follow payments in online gaming and sportsbooks, you probably know how Trustly solutions have changed the way players deposit, validate their identity and make withdrawals in markets across Europe, writes Liam Colclough, the company’s Business Marketing Manager - Gaming.

What you may not know so much about is the value we provide beyond payment services. So, I would like to take this opportunity to share an overview of our broader vision.

First of all, I will explain how we are increasing user awareness of Open Banking Payments in the UK, and around the world. I have some exciting news to share in that department.

Additionally, I will look at how our solutions help operators meet responsible gaming standards. That includes automating KYC, supporting AML compliance and fraud prevention.

Finally, I’ll go over our commitment to sustainability and how that relates to consumer preference. This is about more than just being green.

Ready? Let’s go.

We’re driving awareness with West Ham United I’ll start out with that bit of news I mentioned. In February, we were

60 SBC LEADERS • APRIL 2021

happy to announce that Trustly is now the Official Open Banking Partner of the Premier League’s West Ham United Football Club.

Trustly will have a visible presence across the club’s growing digital channels throughout a multi-year partnership. During matches, the Trustly logo is now displayed on the LED perimeter advertising system that surrounds the pitch at London Stadium.

Trustly is committed to creating stronger bonds with sport fans in 2021, and this partnership is catching the attention of millions around the

world. This increased visibility is sure to improve player recognition of our logo in the cashier.

TRUSTLY IS PROUD TO BE THE OFFICIAL OPEN BANKING PARTNER OF WEST HAM UNITED At the heart of the soul of London since 1895, West Ham United is a dynamic, fan-focused football Club constantly moving forward but always

PAYMENTS

with an eye on the past. West Ham United has expressed its dedication to innovation in many aspects of their organisation and Trustly is proud to support that vision.

Evangelising Open Banking in the UK People’s desire for innovative digital services is one of the reasons Open Banking is taking off in the UK. More and more British consumers want faster, easier and more secure ways to pay.

Trustly has been present in the UK since 2016 and now we’re more accessible than ever. The standardisation of British Open Banking APIs means that all customers of all the major UK banks can now use Trustly to make Open Banking Payments, including online deposits.

Trustly also offers lightning-fast payout solutions, so players can receive their withdrawals right back into their bank account. It’s important to note that not all licensed Open Banking vendors have the capability to offer payouts.

As I covered in detail in SBC News last autumn, Trustly is committed to raising awareness around Open Banking in Great Britain. We’ve worked with the Open Banking Implementation Entity (OBIE) since it was founded in 2016 by British government with the mission of modernising bank APIs. In addition to gaming operators, we’re actively engaged with British merchants in e-commerce, travel and financial services. We’ve found that once consumers pay with Trustly on one merchant's site, a stickiness is created and they choose us again when they have the chance.

Trustly provides a seamless deposit experience that digital native players crave. Once they experience this frictionless flow, it is hard to go back to old-fashioned card payments.

Over 2.5 million UK bank customers now connect their accounts to trusted third parties like Trustly. According to data from OBIE, that number is up from 1 million in January 2020, so it’s clear that the speed, simplicity and convenience of Open Banking appeals to British consumers.

According to Trustly research, when a consumer decides to try a new payment method, security and regulatory oversight are two of their biggest concerns.

Part of our consumer outreach is to communicate our commitment to security and data protection. That includes the fact Trustly never stores any data that can be used to access funds in the customer’s bank account.

Within Britain and the EU, biometrics are defined as one of the key safeguards for payment authorisation.

Trustly’s biometric authentication not only increases consumer trust, fingerprint and face IDs provide the seamless UX players want.

Additionally, thanks to two-factor authentication, Trustly’s payments are always fully traceable. We have implemented comprehensive merchant due diligence, transaction

monitoring and reporting processes, which all help to reduce money laundering and terrorism financing in society at large.

BEYOND PAYMENT TECHNOLOGY, TRUSTLY SUPPORTS KYC, AML & FRAUD PREVENTION Beyond payment technology, we support merchants in tracing and verifying the source of funds, as well as lowering their transactions costs and reducing fraud. In addition to Pay N Play®, we offer Lean KYC, Name Verify, and Age Verify, value-added services that help leading operators automate compliance across multiple markets.

As part of our commitment to supporting operators’ payment

Building consumer trust and strengthening fraud prevention Part of gaining consumer confidence is providing a trustworthy product.

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The broader vision

optimisation and compliance processes, we continuously monitor and respond to changes in local regulations. This not only reduces the operator’s risk, it helps fortify consumer confidence.

Providing a more sustainable way to pay Consumers are increasingly interested in sustainability. A sustainable profile can be a real differentiator for operators –– and Trustly is dedicated to strengthening the sustainable bona fides of our partners by being a responsible supplier.

As part of our commitment to providing a more sustainable way to pay, Trustly has integrated sustainability efforts into our overall business strategy and operations.

In addition to environmentally sound practices, sustainability is also measured in terms of economic viability, and social equity.

When it comes to the environment, we’re committed to mitigating our impact on the climate, demonstrated by our investment in climate-efficient offices and data centers. We strive to ensure suppliers meet our high standards and we do our best to

62 SBC LEADERS • APRIL 2021

PAYMENTS

TRUSTLY IS COMMITTED TO PROVIDING A MORE SUSTAINABLE WAY TO PAY recycle and reuse our IT hardware and e-waste.

We believe that diversity drives innovation that results in the creation of products that are more inclusive.

Our workforce is made up of more than 50 different nationalities, and we’re continually improving our gender balance.

In terms of economic viability, rather than using credit, consumers pay with money already in their bank account when they choose Trustly. As a debit payment method, Trustly is a sustainable way to pay that doesn’t contribute to increased consumer indebtedness in society.

At the same time, we deliver enhanced transparency and a more convenient consumer experience, without any hidden fees.

This is just an overview of our sustainable approach to powering the shift to a cardless society. You can find the full Trustly 2020 Sustainability Report here for more details.

New Trustly products will continue to add value for operators We believe that Pay N Play® is best-in-class when it comes to providing a faster, easier and more secure way for players to verify and deposit online. In the coming months, we will continue to expand our catalog with innovative new products that meet that same high standard.

Now live in Sweden, our Scan N Play product is a revolutionary cashless solution for land-based casinos and retail gaming shops. In 2021, Scan N Play will become available to landbased operators across Europe.

You’re sure to hear more about Scan N Play and more value-adding services from Trustly soon. Watch this space! •

NOW LIVE IN SWEDEN, SCAN N PLAY PRODUCT IS A REVOLUTIONARY CASHLESS SOLUTION FOR LAND-BASED CASINOS AND RETAIL GAMING SHOPS

Past, Present and Future

UK NATIONAL LOTTERY LICENCE COMPETITION: HISTORY AND PAST CONTENDERS WITH THE FOURTH TENDER PROCESS UNDERWAY, the

next UK National Lottery operator must overcome a number of challenges

S

ince launching in 1994, UK National Lottery players have raised more than £42 billion for 625,000 good causes, changing lives and donating to the arts, sport, heritage and communities.

One constant throughout the National Lottery’s lifespan has been its current licence holder Camelot, which has operated the lottery since its inception and has won each of its three licence competitions in 1994, 2000 and 2007.

However, in previous licence competitions, several other companies have thrown their hats into the ring to become the next lottery operator.

With the fourth licence competition currently in process and Camelot facing competition from Czech Republic’s Sazka Group and India’s Sugal & Damani, we wanted to take a look at previous contenders for the lottery licence.

First licence - 1994 Camelot, owned at the time by Cadbury Schweppes, banknote printer De La Rue, telecoms group Racal, US computer company GTech and British computer firm ICL, beat seven other contenders back in 1994 for the first licence covering a period of seven years.

The operator was awarded the

64 SBC LEADERS • APRIL 2021

licence by then-regulator the Office of the National Lottery (OFLOT) through the decision of former National Lottery Director General Peter Davis. This was based on its predicted income for good causes, with its process welcomed as robust.

BBC News reported at the time that Davis described Camelot’s bid as ‘clearly the all-round best applicant,’ and ‘strong in every department’.

One of the contenders it managed to defeat was the UK Lottery Foundation, led by billionaire businessman Richard Branson and former cabinet minister Lord Young.

Branson had offered to run the lottery on a not-for-profit basis and was not happy with Camelot being awarded the licence, arguing that his consortium would have given nominated charities and the arts all profits not used to run the lottery.

He said: "With this business, there is no risk. It's a licence to print money.

For a few shareholders to cream off hundreds of millions of pounds from this is absolutely wrong."

Other companies that contended for the first licence include Games for Good Causes, GBLC, LotCo, Rainbow UK, The Enterprise Lottery Company, and The Lottery (RT).

Second licence - 2000

BRANSON THREATENED TO TAKE FURTHER LEGAL ACTION, BUT DUE TO THE PROSPECT OF A LENGTHY AND COSTLY LEGAL BATTLE, HE DID NOT PROCEED

Three historic events took place for the National Lottery between the awarding of its first licence in 1994 and its second licence in 2000.

The lottery’s first live draw took place in November 1994 with 20 million viewers switching on BBC One to watch Noel Edmonds host the draw.

This was followed by the introduction of scratchcards in March 1995 and the launch of a midweek draw in February 1997.

In April 1999, the National Lottery Commission also took over from OFLOT as the regulator of the National Lottery. Just two companies issued bids for the second lottery licence at the turn of the century, Camelot and the People’s Lottery, which was headed by Branson.

Even though fewer companies were bidding for the lottery this time

LOTTERY

around, there might never be another licence competition as eventful as this one transpired to be.

Camelot entered the licence competition under a cloud of criticism, as both lottery ticket sales and the company’s public image had been deteriorating since it was awarded the first licence.

In 1997, three senior Camelot executives picked up six-figure bonuses, attracting criticism from Chris Smith - the new Secretary of State for Culture, Media and Sport..

During the bidding process itself, technical problems arose with lottery terminals supplied by American company GTECH Corporation. It was found that the issue may have accidentally caused winners to be paid incorrect amounts.

Due to this problem and the relationship between Camelot and GTECH, the NLC recommended that the lottery licence be awarded to the People's Lottery.

However, in August 2000, the NLC’s Chair Dame Helena Shovelton announced that neither bidder would be invited to run the National

Lottery as both had failed to meet the statutory requirements. It was felt that the legal problems of the People’s Lottery were responsible for its bid downfall, while Camelot’s relationship with G-Tech was the reason it wasn’t invited to run the lottery.

EVEN THOUGH FEWER COMPANIES WERE BIDDING FOR THE LOTTERY THIS TIME AROUND, THERE MIGHT NEVER BE ANOTHER LICENCE COMPETITION AS EVENTFUL AS THIS ONE TRANSPIRED TO BE Yet, by September, and despite a failure to meet the statutory requirements, the NLC decided to award the licence to the People's Lottery. As a result, Camelot initiated legal action, taking the NLC to the High Court for a judicial review.

Camelot won its case, with the High Court describing the NLC's decision as ‘conspicuously unfair’. The NLC reacted by dismissing the HM Treasury legal

team that had been advising it. Dame Shovelton resigned shortly afterwards and was replaced by Lord Terence Burns.

November saw the NLC reopen the bidding process and both parties resubmitted their bids. In December 2000, the commission announced that Camelot would be awarded the franchise, with voting going 4-1 in favour of the operator.

The fallout of the licence competition continued as one member of the NLC resigned from the commission over the process, deeply unhappy that Camelot had been re-awarded the franchise.

Branson threatened to take further legal action, but due to the prospect of a lengthy and costly legal battle - one which could have resulted in the lottery’s games being suspended - he did not proceed. Camelot subsequently operated the lottery for the next seven years.

Third licence - 2007 In the years between the second and third licences, interactive instant win games were introduced by the lottery in February 2003, followed by the

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launch of Euromillions in the same month the following year.

Once again, only two companies put bids forward to run the lottery - this time, a Branson-led company was missing. Camelot went up against Sugal & Damani, the biggest lottery company in India, to retain its title as the UK National Lottery operator.

However, the more things change, the more things stay the same, as Camelot was awarded the third

LOTTERY

THE LICENCE WAS EXTENDED THROUGH TO 2023 ON THE CONDITION THAT THE OPERATOR DELIVERED AN ADDITIONAL £1.7BN IN LOTTERY FUNDING TO GOOD CAUSES throughout the licence period.

In March 2012, this licence was extended through to 2023 on the condition that the operator delivered an additional £1.7bn in lottery funding to good causes.

During this licence period, Camelot

of the National Lottery. The two commissions officially merged in October 2013.

The Future Since the third licence was awarded, the National Lottery has launched a new Lotto with more prizes and raffles, has celebrated 25 years of operations and introduced the Set for Life draw.

In September this year, the UKGC will award its fourth National Lottery licence to an operator which will take charge of running the lottery from 2023 for the next 10 years.

Upon the announcement of the licence competition last August, the UKGC stated that the next licence holder must build on the success of the lottery by creating a framework that maximises the opportunities for players and good causes to benefit from innovation and creativity, whilst protecting the lottery’s unique status.

DECLINING PLAYER INTEREST IS STILL AN ISSUE THAT MUST BE ADDRESSED

BY THE NEXT LICENCE HOLDER FOR THE GAME TO CONTINUE IN THE FUTURE

licence by the NLC in August 2007.

This licence would be for 10 years starting from February 2009.

The NLC declared that Camelot was selected via a unanimous decision as it was the bid most likely to generate the best returns to good causes

66 SBC LEADERS • APRIL 2021

was taken over by Canadian pensions group the Ontario Teachers' Pension Plan in March 2010.

In that same year, the NLC confirmed its merger with the UK Gambling Commission (UKGC), handing over the regulatory keys

As previously mentioned, the three main contenders in the fourth National Lottery licence competition are current operators Camelot, Czech Republic’s Sazka Group, and India’s Sugal & Damani.

Later this year, the minimum age to play the lottery will also rise from 16 to 18, starting online from 22 April as the government plans to crack down on problem gambling.

However, more challenges for the lottery linger on the horizon. Declining player interest is still an issue that must be addressed by the next licence holder for the game to continue in the future.

The biggest hurdle the next National Lottery licence holder will have to face, therefore, is reinvigorating the lottery as a whole to encourage more people to play while, in turn, sticking to the lottery’s founding principle of raising more funding for good causes. •

Innovate to entertain

PODCAST

MY VIEW IS THAT PRODUCT AND TECH WILL EVENTUALLY DETERMINE WHO WINS OR LOSES THE CATEGORY

WHY FANDUEL IS FOCUSING ON PRODUCT DEVELOPMENT

FOR FANDUEL CEO MATT KING, the key battlegrounds

in the contest for US sports betting market share are technology and player experience, which is why his aim is to “continue to set the pace on product for the industry”

U

nder King’s leadership, the Flutter Entertainment-owned company has grown from a major player in the DFS market into the largest online realmoney gaming operator in the US, with the development of its sportsbook product one of the great industry success stories of the post-PASPA repeal era.

The challenge facing FanDuel now is how to maintain its status as market leader, while simultaneously scaling the business as legal sports betting and igaming becomes available to an ever larger proportion of the US population.

Technology is a central part of King’s plan to make that happen.

“My view is that product and tech will eventually determine who wins or

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Innovate to entertain

loses the category,” he explained. “We have a great product today and we want to make sure that we maintain our product leadership position. That requires significant investment in product and technology.

“We have a very robust roadmap of innovation for the next two or three years that we’re super excited about.”

The end goal for much of this work is to develop an offering that matches the expectations of the digital natives who make up an increasingly large share of the potential market for both sports betting and fantasy sports.

“If you look at the through line of everything that we do, we effectively make sports more exciting for people,” King enthused. “Our products are a way for sports fans to engage with sports in the way that they’ve become accustomed to engaging with other

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digital products.

“If you think about the growth of just video gaming in general, people want to engage. If you think about the growth of social media, a lot of that’s around personalisation and engagement. What we’re doing is delivering products that help sports, frankly, come into the 21st century.”

This approach is partly driven by King’s self-proclaimed status as a “sports media geek” and his belief that the US betting industry has a lot to learn from the experiences of sports broadcasters and publishers.

WHAT WE’RE DOING IS DELIVERING PRODUCTS THAT HELP SPORTS, FRANKLY, COME INTO THE 21ST CENTURY

“Sports is really interesting to track through the disruption that’s going on across the media landscape,” he explained. “For instance, a lot of people talk about ratings being down and instantly equate that to young people not caring about sports.

“I would take the opposite view, which is I think people of all generations care about sports. The way that younger generations want to consume sports, the way they want to watch, it is just very different. It’s shorter intervals, it’s different platforms, it’s not sitting in front of a TV in a passive way for three hours.

“That’s one of the places that’s really interesting in terms of how a company like FanDuel can fit into the ecosystem, in terms of helping connect sports fans and create experiences for those younger generations of sports fans

PODCAST

that they’re not going to get through a traditional kind of TV viewing experience.”

While innovation is central to the culture of FanDuel, the aim has not always been to achieve radical leaps in product development. In the period immediately after the repeal of PASPA, the focus was on keeping things simple for customers.

“In the early days of any market, the biggest product innovations are the basic stuff. How do you make it easy to sign-up for an account, easy to place a first bet, easy to understand what’s going to happen,” said King. “We were really educating customers, so some of the innovations were not sexy, but they were really important in terms of making it a good first-time experience.”

From there, the FanDuel team set about developing products that

appealed to the armchair sports fan, rather than just the serious sports bettor. One of the most successful has been the same-game parlay, which King described as “much more of an entertainment product, which we’ve seen a lot of users gravitate to”.

This idea of sports betting as an entertainment experience is another central pillar of King’s approach to driving growth in the business. His belief in the importance of giving FanDuel’s customers a great experience stretches as far as thinking that it was not that important for the company to

SPORTS IS REALLY INTERESTING TO TRACK THROUGH THE DISRUPTION THAT’S GOING ON ACROSS THE MEDIA LANDSCAPE

make money on Super Bowl Sunday.

King explained: “The historical stereotype of a sportsbook is that you are a trading operation, that your job is to effectively take risk on from bettors.

You make money over time by just making sure that your risk management is better than somebody else’s and you’re effectively a trading house.

“Our view is that we’re an entertainment business. At the end of the day, we need to build a product experience where we deliver a good value for somebody’s dollar. So if I think about the Super Bowl, it’s really less about ‘do we win or lose’ and more about ‘do we deliver a good product experience for people’, because that is the day of the year when we’ll probably have the most active players.

“If we deliver a great experience, I

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PODCAST

know that they’ll come back over time, in a way that will eventually turn out to be kind of good value for us as the sportsbook. But at the end of the day, it’s really about delivering good entertainment value day in and day out.”

AT THE END OF THE DAY, IT’S REALLY ABOUT DELIVERING GOOD ENTERTAINMENT VALUE DAY IN AND DAY OUT

The belief that most bettors are as interested in the overall experience as they are in the financial transaction means that King is optimistic about the prospects for FanDuel’s portfolio of retail sportsbooks. While the nature of society may be increasingly digitalfirst, he expects the operator’s sites at high-profile locations such as Meadowlands Racetrack in New Jersey, Detroit’s MotorCity Casino and the newly rebranded FanDuel Sportsbook & Horse Racing at Fairmount Park, Illinois to thrive once the pandemic eases.

“I don’t think you’re going to see the end of retail sportsbooks. I think they need to evolve the same way that any retail experience needs to evolve, but online is not a full substitute for the retail [sportsbook] experience,” said King.

“The reason that sports is such a powerful force in our culture is the ritual around it and one part of that ritual has always been gathering with your friends and your family. PostCOVID, I think you will see people bring back some of those rituals and that means that they will go back to

retail sportsbooks.

“That gives us a leg up relative to a department store, where I would argue that the online shopping experience is a much better substitute than online sports betting is for people who want the retail experience. You can clearly deliver a great sports betting product experience online, but we can’t deliver the entire social experience that a lot

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of people are looking for when they go to a retail sportsbook.”

What FanDuel can do though is to offer bettors in a number of states a choice of experience.

“A lot of our users do both,” added King. “They like to bet on the app during the week, but on the weekends, their ideal day is to go to the sportsbook and hang out with their friends. I think people will go back to that.” • The full version of the interview with Matt King is available in the debut episode of the SBC Leaders podcast.