Revista Casino edición Londres 2020 by Revista Casino

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FEBRUARY 2018

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Cover SPECIAL ICE LONDON

A TIME OF CHANGE THAT TEACHES TO LEARN Each edition of Revista CASINO is a reason to celebrate. We not only enjoy doing our work with passion, but also reflecting everything that happens in the gaming industry. On the commercial, there are new products, innovation, research, statistics, successes, advances, events and everything that surrounds this exciting market. However, it is not all about regulations, casinos, the digital age, planning, projects and realities. There are also life stories. In these pages there will be reports of all types and colors, within the British situation as well as in the analysis for the rest of the world. ICE London is an essential meeting point for all business units, as well as a foundational stone of what this year and the coming years will be like. The universe does not stop. Time teaches us how to be better. The information comes at the speed of light. Companies must live up to the different changes and tastes of consumers to continue offering excellence in entertainment.

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But our cover has a symbol. People are finally the support of this industry. Teams are the starting point of good ideas, whatever the field where a job is developed. Behind each one of those people, of each one of those tasks, there is a human being. Inspiration has a starting point. The development of our professional side is as a complement to the experience. The effort is a consequence of our willpower. Obstacles are part of our instinct to overcome. “The impact of women in the gaming industry is just like the impact of women in any other industry,” says Christie Eickelman in our cover story. She is one of the most respected and admired female executives of the game, who currently occupies the leading role in an organization that grows steadily. The society is changing. The betting industry is a true reflection of that truth. Women, as an essential symbol of human life, are also an engine of transformation, either statistically or from their nature. Their leadership is a reality. It was based on a theme that touches all human beings: learn and teach. That’s what life is about, always. In my name, it is a real pride to open the anniversary of the two decades of Revista CASINO with an edition of these characteristics, because in its origins it also had to travel a laborious road until it was established and is currently maturing along with these times of change. It is a product that travels the industry day by day and its presence is absolute in each of the most important shows in the world. Today the appointment is at the cradle of gaming, but our goal is to always accompany you, at all times, in all places. The pride and happiness of making this product a reality fills our soul. The thanks for the entire industry are infinite. In the same way, to the entire Revista CASINO team. We are passionate about what we do, committed to the project, involved to cover every detail and willing to do the maximum in pursuit of quality. We invite you to read this special edition from beginning to end. It is a privilege for us to reach our readers.

Kind regards,

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contents 06

February

UK Horse Racing An industry between The Queen, bets and work

12 17

Christie Eickelman “It’s important to love what you do”

The digital era continues to set the stage for betting

eSports One of the industry’s fastest growing wagering sectors

A cashless world Payment solutions, the future of the gaming industry

Responsible gambling Because betting remains an entertainment

Korbi Carrison “It is inspirational to see women ascend in the industry”

UK National Lottery The 2020 tender

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UK Horse racing

AN INDUSTRY BETWEEN THE QUEEN, BETS AND WORK Royalty laid the foundations of horse racing in the United Kingdom, which not only became a popular phenomenon for the people’s love for race and gambling, but also for the impact it generates on the national economy.

here are many queens. In the games, there are queens in the cards and in chess. But in the world of horse racing, the only queen is The Queen of England. The story goes that she was 16 and her father, George VI, “introduced her to the first two loves of her life: Big Game and Sun Chariot,” two of the horses owned by the royal family. At 93, the only event to which Her Majesty ensures presence is at the meeting of Royal Ascot, the historic racing event in the United Kingdom. The Queen had her first riding lesson at just three years old, and she and her

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sister, Princess Margaret, received their own ponies when she was four—and Her Majesty’s love of everything equine hasn’t dwindled. By age 18 she was an accomplished rider, and has continued to ride for pleasure into her Diamond Jubilee year. In her role as monarch, Elizabeth has also ridden in a ceremonial role. From her first appearance as princess in 1947 and throughout her reign as queen until 1986, she attended the annual Trooping the Color ceremony on horseback. Initially, she rode a bay police horse named Tommy in 1947. When her father, King George VI, was unwell, she rode in his

place on his chestnut horse Winston, and she rode Winston after George VI’s death. Later she surrounded a chestnut horse named Imperial. For eighteen consecutive years, from 1969 to 1986, her horse was a black mare named Burmese. Burmese was a gift from the Royal Canadian Mounted Police. From 1987 onward, since Burmese retired, she has attended in a carriage. At 92 years old, Queen Elizabeth can still be seen riding her beloved horses. As a horse racing fan, her passion was part of a family legacy. Her Majesty owns many thoroughbred horses

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for use in racing, having initially inherited the breeding and racing stock of her late father King George VI, in 1952. Up until the late 1960s she raced her own-bred stock as well as horses bred by the National Stud. Her registered racing colors (termed silks), as worn by the jockeys riding her race horses, are the same as those used by her father and greatgrandfather, King Edward VII; a purple and scarlet jacket with gold braiding, with black cap. Logically, her stable is called “The Queen”. Both her colors and her presence is a registered trademark of horse racing in the world. She is not always present when her horses compete, but when she is there it is a source of joy for horse racing lovers. Her success as a horse racing lover is symbolized as an ambassador for the industry throughout the world. Her word is a respected voice when making decisions. She also owns good results. The Queen has earned a staggering £7,768,448 in winnings from her horses over the last 31 years. Her Majesty has won 534 races from 3,205 runs over her career as a racehorse owner, across both the flat and jump races in the UK and Ireland, new research reveals. The most profitable year came in 2016, a record year in terms of winnings, with her horses earning £560,274 across the flat and jump seasons dating back to 1988, when records began, with Carlton House her top-earning horse across this period with £772,815 in winnings.

Bookmakers are the basis for betting on horse racing in the UK.

Elizabeth II is depicted on horseback in statues in these places: Ottawa, Canada (Parliament Hill, unveiled 1992); Windsor, England (Great Park, unveiled 2003); and Regina, Canada (Legislative Building, unveiled 2005). For the racehorse industry in Britain, she is a universal emblem.

THE SPORTS OF KINGS Horse racing exists since the world is world. The original villages ran simply for fun, on occasional tracks and with native races. Although it was thought that the first formal horse racing events in the United Kingdom took place during the Middle Ages during the reign of Henry II, it really stood out in English culture during the reign of King James I. It was not until he established the

The breeding industry employed around 3,500 people.

Newmarket’s small town as a royal complex, built the famous castle and started running horses there, which became known as an important milestone for horse racing and other races began to appear in other parts of the country in places like Yorkshire, Croydon and Enfield. The first reference to the sport of horse racing dates back to England in the sixteenth century. We know that the concept of riding a horse and competing against an opponent predates that by some margin but this is the first time that we see horse racing listed as a competitive and largely friendly sport. We also know that wagering took place prior to this time so we can be almost completely certain that when the sport became official in Great Britain, gambling came along too and was synonymous with it. 1504 marks the year when James IV of Scotland is said to have attended a meeting at Leith and just eight years later, the UK had its first official thoroughbred race in the shape of the Chester Cup, first run in 1512. It was under the reign of Queen Anne that horse racing really took off and started to resemble the sport as it is known today. In 1711 she first had the vision of a major racecourse at Ascot. One day whilst out riding she is reported to have looked out onto an area of open land close to Windsor Castle and expressed her desire to establish an area “for horses to gallop at full stretch”. Later that year the first ever race meeting is FEBRUARY 2020

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Great Britain host 24 of the world’s top 100 races.

held at Ascot. To this day, the opening race at the Royal Ascot festival each year, the Queen Anne Stakes, is fondly named after her in recognition of her efforts to progress the sport as a mainstream past time in British sports culture.

THE MAGIC OF ROYAL ASCOT In 1711 it was Queen Anne who first saw the potential for a racecourse at East Cote, declaring that it looked an ideal place for “horses to gallop at full stretch” while out riding. Her Majesty’s Plate, worth 100 guineas and open to any horse, mare or gelding over the age of six, took place on 11th August. Each horse was required to carry a weight of 12st and seven runners took part. The race consisted of three separate heats which were four miles long (each heat was about the length of the Grand National), so the winner would have been a horse with tremendous stamina. At present, Royal Ascot brings together the best horses in Europe, as well as the most prominent that arrive from other powers in the world. It’s five days of racing, with the flower and cream of a historical industry. Elegance is combined 8

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with class. Also, also with the popular. It is a social party where the racehorse is celebrated as an icon of greatness. Each of the functions opens with the procession of the Queen of England in ancient carriages full of magic and tradition. The Royal Enclosure is the most prestigious of the three enclosures, with recent visits from the Queen and Royal Family members. Access to the Royal Enclosure is restricted, with high security on the day. First-time applicants must apply to the Royal Enclosure Office and gain membership from someone who has attended the enclosure for at least four years. For existing badgeholders, an invitation is sent out by Her Majesty’s Representative to request badges. The badgeholder’s name is written onto the badge and can be used only by that person. The colors of the badges vary each day for one-day applicants. Those in the Royal Enclosure have the options of fine dining and hospitality, and a selection of bars. The dress code is strictly enforced. For women, only a day dress with a hat is acceptable, with rules applying to the length and style of the dress. In addition, women must not show bare midriffs or

shoulders. For men, black or gray morning dress with top hat is required. Over 300,000 people make the annual visit to Berkshire during Royal Ascot week, making this Europe’s best-attended race meeting. There are eighteen group races on offer, with at least one Group One event on each of the five days. The Gold Cup is on Ladies’ Day on the Thursday.

UK BETS ON HORSE RACING The United Kingdom is the father of betting in the world. Consequently, also in the horse races there is a seal of the Islands. While the idea of a common market organized by racetracks proliferates in much of the world, a business modulated by private companies has been thought about since the beginning of time in Britain. According to some sources, The man credited as the first ever bookmaker is a certain William Ogden. Curiously, for a man who essentially gave birth to one of the most popular pastimes and biggest industries in the world, very little is known about his life. What we do know is that Ogden became the first man to offer fixed odds

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on all horses in a specific race. At that point in history of betting, all you needed was a head for mathematics, an entrepreneurial disposition and, of course, a fair amount of money to back you up if things went wrong. The organization of horse racing bets was born when Winston Churchill passes the Race Betting Act in 1928. The legislation meant that profits made from betting could be invested back into the sport, and also that betting could now be taxed and controlled by the government. This lent a fair amount of credibility to betting on the sport as no longer did people have to go via illegitimate gambling rigs or undesirable operations in order to place bets. They could now place wagers with full peace of mind that they were dealing with a properly organized and regulated organization. Newmarket and Carlisle were the first meetings which offered official tote betting pools in 1929. This was the time when important characters such as William Hill and Joe Coral began to appear. Officially, the Coral Group was first established in 1926 but young Joe had started his bookmaking career much earlier. Having left school at 14, a talent for mathematics landed him a job as a clerk in a lamp making factory and it was there that he came into contact with several private bookies. Joe became unofficially employed as a Bookies Runner – an occupation that has ultimately led to many of the

Royal Ascot, created by the crown, is tradition, style and excellence.

established brands that we know today. The mechanics of the job are not widely published but the clue is in the name. People such as Joe Coral would literally ‘run’ the bet between client and bookmaker, handling the cash and delivering any winnings back to the customer. William Hill’s entry into the world of bookmaking provides interesting parallels to that of Joe Coral. Hill ran away from his schooling at the tender age of 12 and by the start of World War One had begun an apprenticeship at the BSA Motorcycle Company in Birmingham. From there he got into ‘running’ and by having access to a bike he could do his job far more efficiently.

The Queen is an emblem of horse racing in the world.

At the conclusion of the conflict, the government was able to turn once again to its issues at home and in 1949, a second Royal Commission was established to see if there had been a shift in public opinion since the first sitting prior to World War II. It was evident that betting was becoming acceptable in all levels of society and over the years, several factors had broken down social boundaries to an extent. Chairman of the commission Henry Willink and his partners agreed with the opinion that attitudes to gambling were stuck in a form of misplaced Victorian morality. Furthermore and perhaps more importantly, the government had also recognised that a huge revenue could be drawn from the proceeds of a legitimised industry. The Betting Levy Act of 1961 meant that for the first time, bookmakers could open betting shops and conduct betting operations away from the race track. The passing of this act meant that bookmakers could now offer – and were restricted to – horse racing pool bets and that it was now compulsory for bookmakers to pay a levy tax on their off-course profits to the Horse Racing Levy Board. This is a landmark date in English horse betting history as not only did it mean that people had easier and greater access to sports betting, but the law, which stated, that companies had to contribute a percentage of their earnings FEBRUARY 2020

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and casino sector quickly exploded onto the market and now accounts for the largest market share, reaching approximately 5.32 billion British pounds in 2019. In addition, the number of employees in the remote gambling sector rapidly increased as well.

AN INDUSTRY WITH SOCIAL IMPACT

Economic contribution of horseracing is £3.5 billion, with over 85,000 jobs.

to the levy board meant that there were additional funds were now available to be invested back into the sport. Established brands such as Ladbrokes and William Hill started to get involved and it’s said that from May 1st 1961, betting shops were opening at a rate of 100 per week until there were 10,000 premises by the following November. Over the years, other names started to appear on the British High Street such as Betfred, Paddy Power and Stan James. In many cases these were regional with BetFred in the Manchester area and Stan James to the west of England and it wasn’t until the digital age revolutionised the way we bet that we began to know them just a little bit better. Growth continued throughout the 1970’s, 80’s and 90’s and although most of us like to gamble online these days, the betting shop on the High Street continues to thrive. The Betting and Gaming Act of 1960 had finally made it possible and had paved the way for operators to go to the global level that we know today.

AT THE PRESENT In 1996 the first fully licensed online betting site, Intertops was launched. Punters across the world took to the idea of placing bets conveniently from inside their own homes and began signing up in their thousands. This then 10

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heralded the age of online gambling as new betting sites began to spring up and companies began investing in webbased operations to complement their services. UK betting sites recognise horse racing as one of the most valuable sports markets and funnel their resources into providing widespread coverage of races from the UK and abroad, which is why, today, the best horse racing betting sites provide outstanding services with race coverage from all corners of the globe, and offer competitive odds prices across the board. Over the past decade the turnover from off-course horse race betting in the United Kingdom (UK) has significantly decreased from 5.74 billion British pounds in 2009 to 4.22 billion in 2019. A similar trend can be seen with off course dog race betting. Despite a slight decrease, the number of betting shops still held steady though, with William Hill and Ladbrokes making up roughly half of the shops. As the gambling trends in the UK shift more and more towards online gambling, also the turnover of oncourse betting decreases. However, according Statista, the overall gross gambling yield (GGY) of the betting sector remains stable at roughly 3.25 billion British pounds in 2019. When looking at the entire GGY over time, the remote betting, bingo

The GB breeding industry’s direct GVA contribution of £62m is relatively low due to the high proportion of unprofitable breeders in the industry. But the industry’s significant spending on suppliers generates a large impact in the UK economy, contributing £224m in indirect GVA impacts. The spending of breeding industry employees and supplier employees generates an additional £140m in induced GVA impact. The breeding industry employed around 3,500 people in 2018. Spending on suppliers generates an additional 6,400 jobs in other industries. Breeding industry employee spending and the spending of supplier employees generates a further 9,100 jobs in the UK economy. The breeding industry spends around £80m on employee compensation in 2017. Supplier expenditure generates an additional £82m in employee compensation in the UK economy. The spending of breeding industry employees and supplier employees generates an additional £124m in employee compensation. Direct gross value added (GVA) measures the pre-tax contribution of the thoroughbred breeding industry to economic output. It is calculated by subtracting the total supplier expenditure from the total revenue of the sector. GVA can also be calculated by adding net profits and wages & salaries, which represent the respective incomes earned by businesses and individuals from breeding. The direct GVA of the thoroughbred breeding industry is estimated to be £62m. The industry generates significantly more income for employees than for business owners, with £80m generated through wages and salaries and -£16m generated in profits.

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INTERVIEW

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Christie Eickelman

“IT’S IMPORTANT TO LOVE WHAT YOU DO” The President of Global Gaming Women (GGW) and the Vice President of Global Marketing at Gaming Laboratories International (GLI) tell how support and trust in her made her life take a new path, where dedication and excellence are virtues to learn and teach.

he comfort zone is, as the concept says, a comfortable place where everything is controlled. Leaving that site requires not only courage, but also personality. No one knows what will be on the other side. In that mysterious journey along the path of the new challenges is that you learn from the unknown, as well as to live with ourselves and everything to discover. One day Christie Eickelman got out of the routine. She is currently one of the most respected people in the industry. Her thanks to the support is to support. She leads both the company where she works and an organization that supports and inspires women to greatness.

I had. Suddenly, here was someone I trusted who was telling me I was ready for more; something I don’t know that I felt at the time. I was very lucky that I had such strong support and encouragement. I was forced to look beyond my comfort zone, take a risk, and make a change.

When did you enter the gaming industry? What were your professional and personal expectations at the time?

So, as you ask about what my expectations were at the time, “expectations” might not be the right word. I didn’t expect to make a leap, and I certainly didn’t expect to find myself on a path that brought me to one of the largest and most respected gaming companies in the world today. However, what did happen is that, early on, I was supported by someone who believed in me, and in the “me” they could see but I couldn’t. That is why I am so passionate about supporting and mentoring today. And I’m so proud of the work we do at GGW in these areas.

I started in September 1991 at Sodak Gaming in Rapid City, South Dakota. At the time, Sodak was the leading full-service supplier of IGT products for the tribal gaming industry. I was a desktop-publishing specialist in marketing at ComputerLand, which in 1991 was a giant company. And, as I reflect back on that, I was in a very comfortable job, both personally and professionally. Then one day, one of my male leaders said, “I saw a job at a gaming company and you’d be perfect for it.” So, he encouraged me to apply. I was in my late 20s and was comfortable where I was and with the job

”I was forced to look beyond my comfort zone, take a risk, and make a change”.

You are currently vice president of GLI, one of the most important companies in the market. What were the most important

fundamentals and learnings in that process? I started at GLI in 1999 as a marketing manager, and since then, I have been supported and have had incredible opportunities to grow. During my time at GLI, I have had the opportunity to see the whole world, not just the U.S. gaming industry. I have had to learn different cultures, different ways of doing things, and had to do multi-faceted tasks. All of this enabled me to see the entire industry with more clarity. I have had, and still do have, strong sponsors within GLI who from the beginning have supported me and put me in positions where I can continue to learn and grow. I learn every day. That’s what we have to do to be successful – not just as women and not just in the gaming industry. As people, we have to constantly seek out new things, new learning opportunities and keep growing both professionally and intellectually.

You received multiple awards in these years. One of the most important was to be named President of Global Gaming Women (GGW), in August 2019. What did that fact mean in your career? It’s not about my career – it’s about the people that I can help in this position. I think back to when GGW was first being formed, and I was approached by the organization’s leadership who told me of their vision of wanting to promote women in the gaming industry, and about creatFEBRUARY 2020

INTERVIEW

ing forums for growth. I knew immediately I wanted to learn from these women. Through them I learned what I wanted to accomplish as a leader and as a champion for people in the gaming industry – women and men - here at GLI and across the industry. So, when the opportunity to become president came about, I knew that I needed to place myself in the mindset of those we would serve. Each day, I think about the people who are looking for mentors and leaders and people to illuminate the path. I have been surrounded by mentors and sponsors throughout my career, so to lead an organization whose mission it is to provide mentorship to others is a responsibility I take personally and seriously.

Women’s leadership is currently expressed in many areas of society. What is the impact of women in the gaming industry? The impact of women in the gaming industry is just like the impact of women in any other industry. Studies have shown if companies have some in leadership roles, their companies become better. Writing in Forbes last year, Caroline Castrillon wrote: “Numerous studies show that women-led companies tend to perform better than those led by men.” She went on to talk about how Kevin O’Leary had said that out of more than 40 companies he invested in, about 95% of the women-led companies met their financial targets, compared with just 65% for businesses with male leaders. Additionally, the organization Lean In writes: “Over the past five years, the number of women in senior leadership has grown. Still, women continue to be underrepresented at every level.” A Harris Poll from January 2018 showed half of Americans want to work for a female leader. All of this means the field is ready for harvest, and it’s time for women to get out of their comfort zones, take a risk, and utilize the tools and programs we have at GGW to step into their greatness.

GGW provides multiple tools for the growth of women in the industry. How was the inspiration 14

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of that learning born? What are the main difficulties that arise?

gaming.” What is your reflection on that scenario?

What GGW identified was that tools, education, and other areas were lacking in the industry. That was a large part of the inspiration for GGW to form so we could get those in place. Now we are building on that foundation, so women have more tools, resources, and places they can go to get those tools; whether that is GGW’s education pyramid, events we participate in, lean-in circles, mentormentee, or networking events. The tools are here for the taking; we as people just have to decide to get out of our own way, to take advantage of the tools that are available, and to keep growing.

The challenges are real for people in the work force; however, we live in an incredible time. This isn’t 1940 or 1950 or even 1991. Companies of all sizes around the world are embracing diversity across all spectrums. We see that in GGW’s sponsor companies and in companies in all aspects of the gaming industry. Perhaps more than ever before, women are advocating for other women and are taking advantage of the programs GGW provides. Smart companies have diversified, and we see diversity committees and diversity leaders. I see that in my own company. At GLI, our diversity initiatives are illuminating the path for the next generation of leaders and employees. The good news is there are more companies who, like GLI, are embracing diversity today more than ever before. This is a movement that is gravitating into a space filled with possibility, and that is creating a more positive image for everyone who works in the gaming industry; not just for women; for all of us.

”Find sponsors, find mentors, find where you want to be better, celebrate, and advocate for other women”. You wrote “About the Why”, where you quoted Mother Teresa: “It is not how much we do, but how much love we put into what we do.” How do you define that inspiration in relation to the gaming industry? How does that “love” enhance the vocation? It’s important to love what you do. However, part of that is to think bigger, to think beyond just yourself and what you do every day. What do we truly love, and how can we make a difference using that love? For me, it is a love for people and for mentoring. I feel because of what I was given by the people who supported me early on, I have an obligation to put that love to use. I’m so lucky to be at GGW and at GLI, where I can use that love to help others grow.

In that same article you quote that “research tells us women account for over half the hospitality workforce, yet women hold just 36 percent of management or higher positions in

What are the tips you would say to a woman who tomorrow wants to start a career in the gaming industry? When I started in gaming, there weren’t a lot of resources available where you could research companies, their values, and if their values aligned with yours. Today, companies are more open about who they are and what they offer. So, everyone should take advantage of that knowledge and to discover the opportunities their companies provide. Organizations like GGW are here to help provide additional tools, resources, and leadership. However, even with everything that is available today, there are women who, like me back in 1991, are comfortable. They might not see their own potential for greatness. To them I say don’t’ be afraid to take a risk – get outside of your own comfort zone. Find sponsors, find mentors, find where you want to be better, celebrate, and advocate for other women. I, along with everyone at GGW, will be cheering you on every step of the way.

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ABOUT THE WHY Global Gaming Women has a strong mission, and our guiding principles of courage, integrity and leadership continue to inspire our board and the women we serve.

s an organization, GGW supports the development of women at all levels throughout the industry. We actively create opportunities for women from all segments of gaming to come together in an effort to enrich their professional and personal lives. However, the “why” we as a GGW board are so passionate about serving women in the gaming industry is worth repeating, and that “why” will be a guiding star as I accept the honor of steering the GGW ship for the next two years. Research tells us women account for over half the hospitality workforce, yet women hold just 36 percent of management or higher positions in gaming. A 2018 study from the University of Nevada, Las Vegas—Glass Ceilings & Leaky Pipelines: Gender Disparity in the Casino Industry—puts it succinctly: “Results of this study support a gender leadership gap in gaming. The higher the position, the fewer women there are. When women do lead, they are more likely to be found in traditionally women-dominated departments, like HR, that are generally not perceived as tracks to the boardroom.” This is not simply an issue of filling seats at a table or creating equity in statistics. Studies dating back as far as 2009 lay out a clear business case for bringing more women into leadership positions in the gaming industry: “When highly emotional and socially intelligent women fill higher positions, not only may gaming companies perform better, other women in

the organization may benefit, as well. Research is beginning to show that when more women fill higher leadership roles, gender discrimination in the workplace and the gender wage gap may be reduced for women further down the organizational ranks.” Through a wide range of activities, GGW helps to prepare women throughout the industry and at all levels of their careers to take on leadership roles—both by building leadership skills and a sense of empowerment. We are proud to report that there are more than 8,000 members in the GGW network, representing more than 50 companies. Further, GGW awards 300 educational scholarships annually. These networks, scholarships, and our myriad other events all build toward the goal of creating a deeper, wider and stronger talent pool, filled with women eager and ready to tackle the positions and challenges of leadership.

None of this would be possible without the many companies and individuals who support GGW. We are extremely grateful to them for their financial support, which is always coupled with valuable insights and intellectual support. Now as we broaden our donor structure, bringing more companies and individuals into the fold and on board with our mission and goals, we will ensure we will have the resources necessary to support the development of women at all levels throughout the industry. Mother Teresa taught us many valuable lessons, and one quote of hers inspires me when I think about leadership. She said, “It is not how much we do, but how much love we put into what we do.” She also taught us, “It is in giving that we receive.” This is the “why.” As a GGW board, we are passionate about this industry, about the women we serve, and about our mission to help others succeed. We are asking you to join us.

FEBRUARY 2020

INTERVIEW

Allie Barth, American Gaming Association Senior Vice President of Industry Relations

“THE VISIBILITY AND PROFILE OF WOMEN IN ALL INDUSTRIES CONTINUES TO IMPROVE” The executive spoke about her main inspiration to grow within the industry and how does she defines the role of women in the gaming market.

he American Gaming Association (AGA) is creating new pathways for industry growth, innovation, and reinvestment while promoting the social and economic value the gaming industry delivers across the United States. They advocate for casino operators, manufacturers, suppliers, and employees, speaking for the industry on a range of business, legislative, and regulatory issues. Allie Barth commented that one of the objectives of the organization is to unite the American casino industry to advance a proactive policy agenda that ensures gaming thrives and contributes to local communities.

In what position, year and company did you start in the gaming industry? What is your situation now? I started with the American Gaming Association in 2014 as the Senior Director of Communications and am now Senior Vice President of Industry Relations.

What was your main inspiration to grow within the industry? What were the most important learnings? Having spent many years focused on communications, marketing and public affairs/advocacy, I wished to better understand the business of gaming. The most important learnings have been around how member companies specifically evaluate their ROI, where investment is not just hard costs, but time, effort and attention. It is illuminating to understand the value of human resources, especially to 16

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learn where gaming leaders will dedicate their time and energy and why.

How do you define the role of women in the gaming market? What do you value most of a leader? The role of women in gaming, like every industry, is significant. While the visibility and profile of women in all industries continues to improve, I’m heartened to see the women in gaming who have served as leaders in the industry to date – and that the predominately male-dominated casino-gaming industry is among the first to recognize and applaud those female gaming leaders. For instance, an earlier inductee into the Gaming Hall of Fame was

Claudine Williams, who was touted as a pioneer for her knowledge and leadership in gaming. Leaders who support, recognize and celebrate achievement for those who truly achieve it, regardless of demographic or psychographic differences, are the types of leaders that I value most.

The percentage of women in high executive positions grows year by year. Do you think that trend will continue? What are the most important challenges for women today? The more role models that young women see through women executives, the more tangible the goal becomes for our next generation of women leaders.

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Korbi Carrison, G2E event director

“IT IS INSPIRATIONAL TO SEE WOMEN ASCEND IN THE INDUSTRY” The executive spoke about the most important challenges for women today, defined the role of women in the gaming market and explained what does she value most in a leader. and companies achieve their goals. I have learned that when you demonstrate loyalty and dedication, it makes an impact and is not forgotten.

How do you define the role of women in the gaming market? What do you value most of a leader?

orbi Carrison started working in the gaming industry in 1995 at a company called Gaming Systems International. Over the years, she has worked in marketing for WMS Gaming, IGT and Everi, also spending a few years working for a trade show company and as a conference director for Spectrum Gaming Group.

What is your situation now? I’m currently the event director for Global Gaming Expo (G2E), which means that I’m responsible for all aspects of the show planning and execution, such as overseeing sales, marketing, operations, registration, education program and key attendee recruitment.

Over many years, I have been inspired by many wonderful mentors, friends and colleagues in the gaming industry. What was your main inspiration to grow within the industry? What were the most important learnings? Over many years, I have been inspired by many wonderful mentors, friends and colleagues in the gaming industry. It’s definitely the people in the industry that have kept me here. I really enjoy connecting people and helping both individuals

Women are capable of doing anything in the gaming market. It is inspirational to see women ascend in the industry and to hear their experiences and ways that they overcame challenges along the way. Everyone faces challenges as we grow in our careers. Hearing the stories from women who have been there and done that makes career aspirations most relatable. I really appreciate leaders who are willing to spend time as a mentor to share experiences and to discuss new ways to approach work. That support can come from individuals as well as mentor groups.

The percentage of women in high executive positions grows year by year. You. Do you think that trend will continue? What are the most important challenges for women today? I think we will continue to see more women in executive positions in the future. The challenges for women are really the same challenges that everyone faces. Sometimes people choose to face their challenges differently. Women have the unique opportunity to have networking groups and support systems, like Global Gaming Women, to engage with. Building up a network of supporters around you, and in turn supporting other women, inspires continued career growth. FEBRUARY 2020

REPORT

Ainsworth latam strikes again

EXPANDING THEIR BIGGEST WIDE AREA PROGRESSIVE IN MEXICO TO A NATIONAL LEVEL The proven Big Six by Oriental Express surprised the market with the expansion of its robust WAP Progressive, which has leveraged a strong foothold in Mexico.

“By working directly with our clients in all jurisdictions and making sure that we develop products that bring excitement and entertainment to the players”.

Miguel Cuadros, President - Latin America at Ainsworth Game Technology, Inc.

he leading company continues its success in one of the most important markets in LatAm. “Ainsworth is committed to leading the market in Mexico and has invested substantial resources to increase their presence in the region, by developing innovating products for a number of years and now we have the opportunity to raise the bar in with the launch of the Big Six”, said Miguel Cuadros, Ainsworth President for Latin America “By working directly with our clients in all jurisdictions and making sure that we develop products that bring excitement and entertainment to the players. Our groups of professionals are in constant communication with our clients. We track the game performance and produce in-

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trinsic data which allows us to ensure that our products carry out all market demands”, added Cuadros about development. Excitement at the Ainsworth Mexico office reached its highest point as the team has successfully expanded their biggest wide area progressive in Mexico through a partnership with the Logrand group. All the group’s casinos will now be connected to the Big Six progressive presented by Oriental Express, offering their players new and exciting ways to win lucrative jackpots. This is Ainsworth’s biggest wide area progressive to date and it is top of its class in this product segment. The introduction of Oriental Express allows eleven separate casino loca-

tions to offer local jackpots as well as one mega jackpot that gives players in all participating casinos a chance at gigantic payouts. The Big Six wide area progressive is powered by Ainsworth’s proprietary technology. The Oriental Express theme package includes games such as Snake™, Tiger™, Double Dragon™, Fortune Ox™, and Peking Panda™. These games create a larger-than-life oriental gaming experience that pairs perfectly with the wide area progressive, giving players a chance at the largest jackpot available across Mexico. Longtime partner Logrand Group has been exceptional in allowing Ainsworth to provide them with the leading technology used in the region. Ainsworth’s understanding of its customer’s needs and its ability to supply them with products that are a good fit for their specific market are the cornerstone of AGT’s business model and success.

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FEBRUARY 2020

REPORT

ARUZE: INNOVATING THE SLOT EXPERIENCES

The slot machine company prepares to present its innovative offer of cabinets in ICE London 2020.

ruze Gaming is focused on innovation. Their products line is always growing to expand the game choices they provide in order to meet the needs of their business. It´s one of the fastest growing companies in the global casino gaming industry, thanks to its quality premium video and mechanical slot machines. Aruze focuses on creating the best gaming experience for players and outstanding service to its casino customers. Also, it offers ETGs and enhanced table games and associated products. Therefore, every year is always at the forefront, offering innovative products. This year, Aruze Gaming is delighted to exhibit their Muso Curve-43 Hybrid and Muso Triple-27 Hybrid cabinets for at ICE London 2020. The Muso Triple-27 Hybrid is the newest, with an impressive lighting display to attract players, has a newly designed audio system that generates a powerful high-performance sound and is the first slot machine equipped with a wireless charger. While, Muso Curve 43 uses a vertical 43-inch J-style curved LCD monitor creating a brighter display, has a bass-reflex technology utilizing a powerful bass module that delivers superior sound and clarity, and is equipped with Qi standard wireless charger and USB charging port. A compelling mix of proven performers and future concepts in game design will be on display at booth S5-210. Highlighting the global nature of ICE London, several machines will feature configurations ideal for various Latin American markets. Also being shown is a selection of Limited Payout Machine titles intended for the South African market.

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Aruze Gaming’s focus on the European market is also apparent, with machine installations recently taking place in Greece, France, Switzerland, Cyprus, Portugal, Germany and Slovenia. A standout performer has been Wheel of Prosperity, now expanded to four titles. This series offers a strong base game, exciting wheel feature, and a free games series that varies by title. Wheel of Prosperity Serpent, one of the two new titles in this series offers

Aruze focuses on creating the best gaming experience for players and outstanding service to its casino customers. a free games feature where the Wheel awards a number of wilds that explode across the reels with every spin. Wheel of Prosperity Tiger offers players their choice of three reel configurations for their free games, up to 5 x 5 symbols for a thrilling 3125 ways game. Pachincoin Jackpot Circus is a unique concept that leverages Aruze’s

history with the Japanese pachinko market to create a totally new style of game. Players do not need to be familiar with pachinko at all as the interface and game play are intuitive, and bet structures borrow from traditional slot play. Based on the bet and denomination selected, Pachincoin Jackpot Circus utilizes multiple coins that waterfall down the playing field with multiple prize pockets. Players can release many coins quickly, creating a riot of activity on the game screen. Aruze has a variety of titles ready to Ignite Fun on display at its stand.

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2020 VISION: OPPORTUNITY STILL LIES SOUTH OF THE US

n 2019, many suggested that the US wasn’t the only emerging market that sportsbooks should have their eye on. And with good reason too. In 2020, South America is still proving to be a land of opportunity, with a burgeoning population keen on sports and the prospects of legalised betting becoming increasingly realised. For big operators and small, there are plenty of ways to leverage from the various aspects that make LatAm uniquely appealing.

Lorenzo Caci, director Business Development and Strategic Partnerships at Sportradar AG.

LEVERAGE AND LOCALISE As many are aware, Latin Americans have a huge affiliation with football. And, as one of the most popular betting sports worldwide, this makes the region very attractive for both budding and established sportsbooks. You only have to look at the more mature markets, like Europe, who share similar levels of appreciation for the game, to see just how opportune football betting can be, so operators would be wise to tap into this in Latin America too. This is a great way to achieve localisation – using regional football tournaments to attract punters and provide them with an offering that will appeal to their passion for their local league or team. Add on more detailed components, such as Player Markets, and you can offer all new ways for fans to get closer to the action and their favourite athletes.

EMBRACE THE FUTURE While many in South America may currently trust and enjoy heading to a physical location to place a bet, this doesn’t mean operators should be investing in retail alone. Like all good business, smart operators will have one eye on the future and the trends of next generation audiences, given they are their potential next customers. As such, arming themselves with online and mobile

betting tools is the way to go, and now. You only have to look to LatAm’s close neighbours up north to see just how much an impact live in-play betting on a handheld device is having, despite the fact it’s still only early days for legalised betting activity in the US. In response to such trends, Betradar continues to increase its live in-play markets across sports worldwide, including baseball, American football and basketball as part of our official data partnerships with the MLB, NFL and NBA. Together with our risk management and trading solution, Managed Trading Service (MTS), these tools can provide bookmakers with unique ways to both grow their profits and safeguard their operations.

START WITH THE FOUNDATIONS Embracing online and mobile betting requires a dedicated understanding and investment in technology. Like the US,

Latin America is currently in the emerging phase with varying audiences and legislation across the many different areas of the region. This can prove difficult to adjust to in ways that ensure a sportsbook can still produce results. A lot of the potential fluctuation however can be handled if you have the right technical tools. Our new omnichannel OPTIMAMGS platform is one such option. Like all of our products and services, the platform has been developed using the latest cutting-edge innovation, meaning it can be integrated seamlessly and in as flexible manner as possible. This allows operators of all sizes to utilise it to supply and license markets and audiences worldwide in whatever way they choose. Used together with MTS, which is just as customisable, creates a complete betting, trading and platform solution, which is one of the best ways operators looking to make it big in LatAm can succeed. FEBRUARY 2020

REPORT

FADJA has a new house and suit

GAT EXPO IS APPROACHING FULL STEAM AHEAD TO CARTAGENA DE INDIAS The new location has very attractive characteristics for foreign visitors interested in Colombia and in the markets of Peru and Brazil, mainly, since they are close to issuing new regulations for online gambling.

José Anibal Aguirre.

aming & Technology Expo (GAT Expo), until last year FADJA, will take place on April 23 and 24 in a completely different scenario to Bogotá. The new location, Cartagena de Indias, has very attractive characteristics for foreign visitors interested in Colombia and in the markets of Peru and Brazil, mainly, since they are close to issuing new regulations related to online gambling. The companies that have already secured their stands at the Cartagena de Indias Convention Center are: IGT, Novomatic, Zitro, WorldMatch, Win Systems/ Gold Club, Pixelo, 1XBet, Rivalo, Colinktek, JCM, TVBet, El Habanero, R. Franco, Automated Transactions, GLI, Zuum, Spintec, Luckia, Ainsworth, Aristocrat, Aruze, Alfastreet, ASAP, Gambee, BMM Test Labs, Toucheng, IBC Group, Digitain, Quinel, Universal Soft, PlayN’Go, Betradar, Even Bet, Golden Race, ICT, BYA Group, Human Contract, Playtech Colombia, Swarm, Ready Online, Audit-

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play, Octoplus, Tombola Online and Recargame Me Online. GAT Expo 2020 location is the Cartagena de Indias Convention Center, the only one in Colombia that holds the Gold Certification of the International Association of Conference Centers (AIPC) and the Bureau Veritas quality certification granted for excellence in its operation processes. It is nestled in the heart of the city in the Bay of Cartagena, surrounded by the Atlantic Ocean and the beautiful colonial architecture of the Getsemaní neighborhood. It has a tremendous physical infrastructure of 18,000 square meters and rooms and spaces both indoors and outdoors, equipped with cuttingedge technology. The fact of taking over the spaces of this convention center that is almost an art gallery, with an academic, institutional and commercial program as complete as the one offered by Gaming Week between April 21 and 24, is

unprecedented in Latin America. Gaming & Technology Week offers a varied menu in terms of training and updating. On April 21 and 22, the Totally Gaming Academy professionalization courses will be carried out in alliance with Clarion Gaming, known worldwide for its quality. José Aníbal Aguirre, General Director of the show, said: “With the Colombian Federation of Games of Chance (Fecoljuegos) we have reached an agreement so that with its vast knowledge about the gambling regulation in the country, it’s in charge of leading and coordinating the Business Round Tables on Gambling Regulation in Latin America, which will be verified on Thursday, April 23 and Friday, April 24 in the morning. Experts lawyers from Mexico, Argentina, Peru and Brazil among others, are extremely pleased with this space of knowledge and support exchange that they will receive from the legal consulting firm Vásquez & Isaza.” Cartagena de Indias is a historic city, today a world-class tourist destination and a reference in the so-called “meeting industry”, with a privileged and strategic geographical location, as a gateway to Latin America, on the Caribbean coast of Colombia. 3A Producciones, the organizing company, works on the planning of the opening reception that will take place on a terrace with stunning views of the sea at the convention center, on Wednesday night, April 22, as well as in the coordination of day and night tours in La Heroica, the “Corralito de Piedra” and its emblematic places for businessmen and visitors from all latitudes.

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FEBRUARY 2020

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SiGMA 2019

MALTA WAS THE HOME FOR THE BEST IN ENTERTAINMENT AND NETWORKING

More than 400 sponsors and exhibitors, 200 industry-leading speakers and a record of 15,000 attendees from more than eighty countries met in the iGaming gathering at the end of November.

uring the sixth edition of SiGMA, more than 400 sponsors and exhibitors, 200 industry-leading speakers and a record of 15,000 attendees from more than eighty countries met in Malta at the end of November. From the organization of the event they recognized that it was the largest edition to date. â&#x20AC;&#x153;With live gaming and eye-catching stand designs, the expo floor was a feast for the senses. Exhibitors brought 24

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a global flavour to the summit, showcasing cutting-edge games and software, offering innovative industry solutions, and bringing crucial networking opportunities to delegates looking to make next-level connections and deals. With energy high throughout the three-day-event, the expo floor was definitely the place to be for delegates looking to mix business with pleasure,â&#x20AC;? said Eman Pulis, founder and CEO of SiGMA Group.

A series of six thought-provoking conferences and workshops offered a mixture of knowledge sharing and fierce debate from some of the best minds in the industry. From finance and blockchain solutions, to tackling the brain drain in the HR and Careers conference, to regulation and compliance across jurisdictions both new and old, to eSports and sportsbook, the event took a 360 degree look at the iGaming sector.

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On the other hand, the annual SiGMA Start-Up Pitch also brought investment opportunities and sound business advice to start-ups looking to gain a foothold in the industry, as they battled it out for the top prize. A fiercely-fought battle saw Bethereum, the blockchain social betting platform, crowned as winner. The Malta Gaming Awards brought glitz and glamour to the official launch of SiGMA 2019 at the elegant Hilton hotel in St. Julian’s, with an evening of fine dining and entertainment. Presented by SiGMA’s own Jessica Walker and Jon Thompson, the evening kicked off with a heartfelt speech from SiGMA Group Chief Philanthropy Officer, Keith Marshall. While the days were jam-packed with activity, the evenings definitely did not disappoint. The organization pulled out all the stops to bring the best in entertainment and networking, from luxury iGathering dinners, to a Betting on Boxing joust, and a sunset cruise, there was plenty of after dark events in the SiGMA calendar to keep attendees busy. A closing night party hosted by Fashion TV Gaming Group, Pragmatic Play and VideoSlots ended the summit in style. “This sixth edition of our iGaming summit showed the continued success of the sector and confirmed our status as the biggest online gaming event on the European calendar. The event gave our Asian visitors a taste of what they can expect in Manila for SiGMA 2020,” Pulis concluded.

Eman Pulis arriving at the convention.

Thought-provoking conferences and workshops offered a mixture of knowledge sharing and fierce debate from some of the best minds in the industry. LATIN AMERICA WAS PRESENT IN MALTA The footprint of the Latin American gaming industry was noted during the three days of the event. A representative of the Colombian trade show GAT Gaming & Technology Expo (formerly FADJA)

Thought-provoking conferences and workshops offered a mixture of knowledge sharing and fierce debate.

fulfilled the agenda of the planned meetings, visiting exhibitor stands and checking the enormous interest that the markets of Colombia and Mexico arouse in online gaming in Latin America. Natalia Moreno, Senior Advisor of the organizing company of GAT Expo, traveled by delegation of José Aníbal Aguirre, CEO of 3A Producciones. She achieved the participation of new companies and was able to take the temperature of expectations and enthusiasm to attend Cartagena de Indias in April 2020, when GAT Expo features its 22th version, premiering name and venue. In terms of debate, Director of iGaming and New Product Strategy at BMM, Filippo Ferri, spoke on the panel “New Frontier: Latin America Regulatory Update”, where he take a deep dive into the regulatory opportunities and risks within the continent ecosystem, as this budding market flexes its jurisdictional muscles into new territories. In the conference, Moreno Roldan concluded that Colombia is one of the countries that offers full guarantees to investors in search of strategic alliances for online gaming: “Colombia is without any discussion, the leading country in South America in regulation and legal security in iGaming. There are local partners with sports betting sufficiency, now also able to include virtual games on their platforms, a situation that is very attractive for international suppliers.” FEBRUARY 2020

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The expo floor was packed during the 3 days.

Ingrid Alvarado Lopez, from Colombia’s gambling regulatory body Coljuegos detailed the regulatory process and underlining the importance for any market to be strongly regulated. Alvarado Lopez commented on the success of the legislative framework that Colombia has adopted, and how this has had a positive impact in the local industry’s exponential growth throughout the past year. Also, BtoBet’s Chief Executive Officer, underlined the region’s potential and opportunities for local and international operators and indicated the importance for operators to have good knowledge about the stratification of the local market: “While broad similarities exist between betting markets across the world, if you’re going to make it big in Latin America you have to know the differences, whether they be practical, such as language and culture, or subtler, such as gambling preferences and domestic approaches.”

NEW PRODUCTS, PRESENTATIONS AND AGREEMENTS AvatarUX Studios has taken its first steps into the casino supplier market after a successful launch event during SiGMA 2019 week. One of the original partner studios of Yggdrasil’s YGS Masters programme, the provider has ambitious plans to produce titles with Asian-influenced art and innovative game mechanics, developed from its Hong Kong office. 26

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The Malta Gaming Authority granted its approval for BetConstruct, to supply its live casino games to the MGA licensed operators and B2C customers. The company views the country as one of the key jurisdictions. Receiving a certification from it powers the company to extend its scope of operation by offering a unique live casino to both local operators and those who also work under the approval from MGA.

“This sixth edition of our iGaming summit showed the continued success of the sector,” said Eman Pulis, founder and CEO of SiGMA Group. iSoftBet opened a new Malta hub days before the exhibition, less than two months after being awarded a B2B software licence by the Malta Gaming Authority (MGA). The office, located in the North Business Center in Sliema, houses iSoftBet’s rapidly growing data team who provide the company with powerful datadriven insights, alongside local account managers who will be able to liaise directly with Malta-based customers. High 5 Games (H5G) also opened a new office in Malta to support its ongoing international strategy of expanding

its presence across Europe. Ahead of SiGMA 2019, the New York-based developer moved into a facility in Sliema, which will house various departments including account management, business development and games design and production. Creating this new office in one of the iGaming industry’s most established hubs will allow MGAlicensed H5G to build on its recent momentum of expanding its reach across the European market. For R. Franco Digital, the imminent grant of a license in Malta generated great expectation and constituted another incentive, giving rise to the numerous assistant team of the company having developed an enormous work attending to a large group of visitors and customers, far superior to from previous editions, with the result of an increase in agreements with operators and customers higher than expected. During the gathering, Hacksaw Gaming announced a new partnership with operator Royal Panda after the two companies agreed a distribution deal. This has all been made possible via the Relax Gaming platform. Games such as Stick ‘Em, OmNom and Miami Multiplier are live in all territories in which Royal Panda operates, including UK and Germany. Also, Paddy Power Betfair signed a content provider agreement with MGA Games. Following the agreement, MGA Games titles shall be available on Paddy Power Betfair’s platform. Endorphina’s Head of Marketing Department, Maria Bashkevich, concluded: “SiGMA 2019 was on a completely higher level and was a great ending to a year of exhibitions for the year. Based on the very positive feedback, I can say that we’ve managed to bring a new and stronger dose of endorphins to our guests and make them feel the real vibe of Endorphina. Personally, I was amazed at the amount of good emotions, productive meetings and fantastic opportunities that SiGMA gave us this year. On behalf of the team, I would like to sincerely thank all of our visitors, exhibitors, and organizers for making this exhibition such an incredible event to be part of.”

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UK Industry

THE DIGITAL ERA CONTINUES TO SET THE STAGE FOR BETTING While the debate over modifying the regulation in the Islands raises the temperature, the numbers are still good for a market that extends its tradition as one of the strongest in the world, but down for the last fiscal year.

om Watson, Deputy Leader of the Labor Party, in early 2019 again installed a debate on the agenda of British society and politics since technology redirected the betting industry. Watson, who has already proposed a series of measures cracking down on the wider gambling industry, will describe the Gambling Act 2005, passed under Tony Blair’s government, as “unfit for the digital age”. The discussion deepened when the Islands market marked a break in the historical structure. October 2017 to September 2018, saw the GGY, OR Gross Gambling Yield, of the UK’s gambling industry hit a staggering £ 14.5bn. Gambling enterprises are required to pay the UK government a minimum of 15% tax on any amount up to £ 2,370,500. The tax then increases accordingly to 20%, 30%, 40% and 50%. At that time, thanks to these astonishing numbers, the gambling industry has cemented its place as one of the UK’s largest and most profitable industries. The story was already changing, but it deepened even more since that period. The UK gambling sector can be divided into a number of different areas, namely; online gambling, betting shops, bingo halls, land-based casinos, arcades and lotteries. Of these, online (or remote) gambling - which includes online betting, online casino games, online bingo and online lotteries - is responsible for the lion’s share of the profits; 39% or £ 5.6bn GGY. Land-based bookies come in second at 22.1% and the National Lottery follows closely at 20.6%. Traditional casinos rake in 7.4% and old-school bingo halls are responsible for 4.7%. 20172018 saw a slight downturn in overall

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profits compared to the previous years. However, as a registered trademark, the numbers still indicate that the UK’s love of gambling remains strong and true.

UK FISCAL YEAR: DOWN, BUT STILL STRONG In the UK the financial year began on April 1, 2018, and runs until March

31, 2019, for the purposes of government working out their finances. About this period, based on a report released by the UK Gambling Commission, online gambling in the UK still generates an enormous amount of revenue. Remote (or online) gambling is the largest sector by GGY. With £5.3bn GGY, it comprises 37.1% of the overall market. Remote sec-

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tor GGY decreased for the first time this year, by £34.2m (-0.6%). Online casino games dominate the sector, generating £3.1bn in GGY, mostly from slots games. GGY for remote betting totalled £2.0bn. Most of the betting decline came courtesy of the horseracing segment, which saw GGY fall 15% to £522m. Football GGY was down a comparatively modest 4.4% to £991m while virtual sports GGY slid 12.5% to £68.6m. Exchange betting, which isn’t included in the overall betting stat, saw GGY slip 1.4% to £166.4m. The historical and traditional sector in the market of the islands also continues to be important. Non-remote betting GGY remained stable and was the second largest sector by GGY with £3.2bn. GGY for oncourse activities increased, while off-course and pool betting decreased. Within off-course data, machines GGY decreased for the first time in 10 years, by £2.1m. Machines represented 57.8% of total off-course GGY. Total betting premises have continued to decline for the fifth consecutive reporting period to 8,320. National Lottery will be in the bidding process by 2020. Meanwhile, in the fiscal (-13.4%), predominantly punto banco year ticket sales increased by £271.6m to and American roulette. GGY from casi£7.2bn. This supported a GGY equivalent no-based machines increased (+3.9%). increase of £71.6m, to £3.1bn, making Non-remote bingo GGY decreased the National Lottery the third largest sector slightly to £677.0m (-0.5%). In the arcades by GGY. Over the sector, adult gamsame period, the £14.4 bn: total ing centres showed a primary contribution slight increase in GGY, to good causes de- gross gambling yield reporting £379.3m creased by £21.9m (GGY) of the Great (+3.2%). GGY for lito £1.5bn. Large censed family ensociety lotteries, Britain gambling tertainment centres which traditionally industry between Apr decreased, reporting have the smallest market share along 2018 – Mar 2019, 0.3% £50.4m (-8.0%). Note that this data does with arcades, saw a decrease from Apr not include unlicensed GGY equivalent in2017 – Mar 2018. family entertainment crease to £541.6m centres which operate (+6.6%), with balance to good causes at £332.2m, a using a permit from a local authority. Machines GGY over the last year to £32.9m increase from the last reporting period. This is the highest contribution fig- March 2019 increased in all sectors except betting and family entertainment centres. ure reported to date. The non-remote casino sector saw GGY increased in all machine categories, a decrease of £121.4m (-10.3%) in ca- except B2 and D. Across all sectors, GGY sino GGY, to £1.6bn. This was led by from Category B2 machines decreased decreases in GGY from casino games by £517.4m to £1.2bn (-30.6%) but it

was still the highest machine category for GGY. It was closely followed by category B3 machines which have increased by £518.0m to £1.1bn (+91.0%). Note that the change in regulations reducing maximum stakes from £100 to £2 for Category B2 machines did no take effect until April 2019, after the reporting period of this publication. The number of licensed activities has decreased by 3.4% to 3,655. These are held by 2,690 operators (-4.6%). The number of licensed gambling premises in Great Britain has fallen to 10,761 (-3.2%). How to calculate your gross gambling yield (GGY). The annual gross gambling yield is calculated in accordance with the following formula: A + B – C. A) is the total of any amounts that will be paid to the licensee by way of stakes in the relevant period in connection with the activities authorised by the licence. B) is the total of any amounts (exclusive of value added tax) that will otherwise accrue to the licensee in the relevant period directly in connection with the activities authorised by the licence. C) is the total FEBRUARY 2020

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In January of this year, Irish bookmaker BoyleSports has bought 35 William Hill betting shops, mostly based in Northern Ireland, for an unspecified amount as the independent retailer is looking to expand their assets. BoyleSports is estimated to have charged between £ 10 m and £ 15 m for William Hill’s 33 betting shops across Northern Ireland as well as two shops in the Isle of Man. This has been the biggest purchase by BoyleSports to date and makes the company the largest betting store operator in Ireland.

ABOUT CASINOS

of any amounts that will be deducted by the licensee in respect of the provision of prizes or winnings in the relevant period in connection with the activities authorised by the licence. During the period April 2018 to March 2019, the regulated gambling industry in Great Britain generated a gross gambling yield (GGY) or equivalent1of £14.4bn, a 0.3% decrease compared with the previous reporting period. As at March 2019 there were a total of 2,690 operators licensed by the Gambling Commission compared with 2,819 (-4.6%) at March 2018, 338 of which operate across more than one sector. Across Great Britain, there were 10,761 gambling premises used by licensed operators in March 2019, compared with 11,115 (-3.2%) at March 2018 Between them, those operators held licences (remote and/or non-remote) that entitled them to conduct 3,656 activities compared with 3,782 (-3.4%) at March 2018. Licensees have paid a combined figure of £19,600,233 in settlements and penalties this year with a further £6,541,188 being divested back to impacted parties and good causes. Across Great Britain, there were 10,761 gambling premises used by licensed operators in March 2019, compared with 11,115 (-3.2%) at March 2018. In addition to premises used by 30

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licensed operators, there were 51,541 premises where gambling is permitted and controlled by licensing authorities. In reliance of their licensed activities, operators as at March 2019 reported 102,782 people employed, compared with 108,820 (-5.5%) at March 2018.

£5.3 bn at total GGY for the Remote Sector from Apr 2018 to Mar 2019, 0.6% decrease from Apr 2017 – Mar 2018. A new report shows that more than 1,000 betting shops across the UK have closed since restrictions were placed on fixed-odds betting terminals (FOBTs) in April 2019. This works out to an average of four betting shop closures per day. Of the 1,037 stores to shut down, 700 were William Hill outlets, 198 belonged to Ladbrokes Coral, and Betfred accounted for 70 shops. Scotbet, previously the leading independent bookmaker in Scotland, has been in receivership since July. The receivers of Scotbet have kept 30 of the 41 betting shops open.

Land-based casinos were the sector that was hardest hit, with year-on-year revenues declining from £1.18 billion to £1.06 billion, a decrease of over 10 percent. During the reported period, GGR for London casinos fell from £243 million to £167 million. One casino, Les Ambassadeurs, accounted for almost 90 percent of this drop. The rest of London’s nonVIP casinos saw a 13 percent decline in GGR during the year being reported. By contrast, all of the other regions, except the South, saw only single-digit percentage drops for land-based casinos. The Southern region saw GGR increase by 5 percent to £82 million. Total remote gambling GGR (casino, betting, and bingo) for the UK experienced a very slight decrease, down 0.6 percent to £5.32 billion. Remote betting declined 10 percent to just over £2 billion and remote casino GGR was up over £100 million to £3.1 billion. Almost 70% of online casino revenues comes from slot games, which have no limits on stakes or prizes, whereas similar games in land-based casinos are limited in number to 20 per venue and a maximum prize of £10,000. The retail betting business was almost static, up 0.1 percent at £1.3 billion, which was offset by a similar decline in GGR from the machines in these venues (FOBTs or B2 machines and B3 machines), down 0.1 percent to £1.8 billion. It must be noted that the reduction in the maximum stake to £2 took effect in the period after this report, so it will be interesting to see, in UKGC’s next report, how machine numbers and revenues have

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been impacted. Casino Participation: The summary is based on data gathered from 141 of 151 operating casinos, on a voluntary basis.

MORE THAN HALF OF ADULTS IN TOUCH On a report published in April by the National Health System, 53 percent of adults had participated in some form of gambling activity during the previous 12 months. When the National Lottery is excluded, the figures show 39 percent of adults gambling - including 56 percent of men aged between 25 and 34. The number is strange considering the tradition that the British have for the bets and the wide offer that exists in the market. Nor is it striking going to the depth of the stage. In total, 29 percent of men aged 25 to 34 reported having participated in online gambling in the previous 12 months, compared with four percent of those aged 65 and over. Across all ages, 15 percent of men had participated in online gambling in the previous 12 months, compared with 4 percent of women. Also, men aged 16 to 24 were the most likely to be classed as problem gamblers, with rates of 1.9 percent, compared with 0.4 percent of the general population. The time has changed. Now access to bets is increasingly available to people. In fact, experts said the Health Survey of England, which polls 10,000 adults and children on their lifestyles, shows smartphone betting holding an increasing grip on younger generations. Changes in con-

On a report published in April by the National Health System, 53 percent of adults had participated in some form of gambling activity during the previous 12 months. sumer behaviour: more than 50% of consumers now gamble online and we have seen a shift towards mobile use over PC or tablet use, with 44% of consumers gambling via their mobile phones, according Gambling Commission.

The rates have been falling in recent years. In 2016, the Gambling Commission reported that 56% of adults aged 16 or older gambled, while 62% had done so the previous year. In 2012, the first year the issue was covered by the Health Survey for England, 68% of men and 61% of women participated in a gambling activity.

DENIS COATES AT THE TOP The 52-year-old multibillionaire founder and CEO of Bet365 Group received £323m in salary and dividends, according to a filing from the British online bookmaker, confirming her position as the UK’s best paid executive. Bet365 made a profit before tax of £791m in the year, compared with £661m the year before. Her salary of 276.6 million pounds from the closely held firm makes her one of the world’s best-paid bosses. It also strengthens her status as the U.K.’s richest woman, adding to a fortune already among the world’s 500 largest, according to the Bloomberg Billionaires Index. Coates’s net worth is set to increase to more than $5bn through her majority stake in Bet365, according to the Bloomberg index. Along with Bet365, Coates and her family also own Stoke City Football Club. She is the only woman among the 16 UK-based billionaires in the ranking, which includes Virgin Group founder Richard Branson and Joe Lewis, owner of Tottenham Hotspur Football Club. FEBRUARY 2020

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New year, new risks

THE MAIN CYBERSECURITY THREATS THAT WILL DOMINATE 2020 In the last year cyber attacks have increased significantly in size and sophistication. New technologies and mobile devices within organizations are the perfect target of cybercriminals.

he impact of cybercrime will undoubtedly grow in the coming years. Cybersecurity Ventures statistics reveal that such crimes will cost the world six billion dollars annually by 2021, compared to three billion dollars in 2015. It also highlights the need for greater innovation and investment in this area, which allows counteracting cybercriminal tactics, especially in view of next year, in which new and more sophisticated threats are expected. In the last year cyber attacks have increased significantly in size and sophistication. New technologies and mobile devices within organizations are the perfect target of cybercriminals. The increase in threats and the innovative strategies in the attack methods employed by hackers can endanger not only information but the security of people, so cybersecurity is crucial to face the new digital era.

Intelligence and technology will be the main weapon in new “cold wars” between the powers of the East and the West, such as the current commercial war between the United States and China. Cyber attacks will also be used in direct and indirect conflicts between small countries, funded and enabled by large nations that seek to consolidate and extend their spheres of influence. In 2019, Ransomware exploits became highly selective against specific companies, as well as against local government and health care organizations. The attackers spend time collecting information about their victims to ensure that they can cause maximum disruption and rescues were expanded accordingly. This tactic is so harmful that the FBI has softened its stance on the payment of bailouts, they now acknowledges that, in some cases, companies can evaluate options to protect their shareholders, employees and customers.

During this year there will be a resurgence of attacks such as targeted ransomware and those focused on supply chains.

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While email is still the main attack vector, cybercriminals are also using other channels, including SMS text messages or the use of messages on social networks and gaming platforms. The first half of 2019 saw a 50% increase in mobile banking malware attacks compared to 2018. This malicious software can steal payment data, credentials and money from victims’ bank accounts. In 2020, phishing attacks will become more sophisticated and effective. According to Kaspersky experts, during this year there will be a resurgence of attacks such as targeted ransomware and those focused on supply chains, as they have proven to be very lucrative and

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have a greater impact on the attackers. In addition, the social situation that exists in several countries of the world will boost the use of social networks for the manipulation of public opinion and misinformation, something that has already been seen in recent months. The company expects infections to exist via attacks on supply chains. It is likely that companies engaged in the production of mass software will become targets of such attacks. The level of maturity in cybersecurity of many of these companies, for example, those that produce accounting software, is quite low. However, the penetration of the software produced by these companies in the

market is usually important, which for attackers would represent a high-impact attack with minimal investment. Also, â&#x20AC;&#x153;worm-typeâ&#x20AC;? attacks may be exploited, taking advantage of vulnerabilities in Windows 7 since technical support for this system ended on January 14 of this year and, according to Kaspersky data, about 30% of users in the region still use it on a daily basis. Cybercriminals will take advantage of the security holes without patches of this OS to attack users, just as it happened with Windows XP. Scams designed to raise funds are planned through phishing aimed at users of buying and selling sites, as well as cryptocurrency exchange. Dissatisfied

with just attacking financial services clients, cybercriminals now seek to commit banks themselves or any institution or organization that offers this type of services, such as correspondents or transaction hubs, as recently observed in Brazil, Mexico and Chile. These types of attacks will continue, carried out both by local cybercriminal groups and by international groups, such as Lazarus and Silence, which will increase their presence. Next year, instead of demanding money for deciphering the information, there will be an increase in extortion campaigns where the victim will be forced to pay a ransom so that their information is not filtered into the public domain. FEBRUARY 2020

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The impact of cybercrime will undoubtedly grow in the coming years.

This will be particularly problematic for hospitals, law firms and accountants, and any type of entity that handles third party information subject to regulations. Additionally, certain cybercriminal groups will choose high-profile objectives where the impact of the attack and media can compromise the operation and reputation of the affected organizations. There will be an expansion of blackmail attacks aimed at companies and large corporations, due to the adoption of new legislation to criminalize data leakage incidents. These laws, inspired by the European GDPR, are being adopted in the world, with the purpose of applying harsh penalties to companies that leave personal data exposed. As a result, criminals, when invading a corporate infrastructure and consequently stealing data, will launch attacks to blackmail victim companies, which will have to choose between paying the penalty imposed by law or paying the criminal, causing direct losses to corporations.

COMPLIANCE ISSUES A recent Kaspersky report reveals that two-thirds (67%) of industrial companies do not report cybersecurity incidents to regulators. Although compliance is a necessity for modern 34

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industrial organizations and an engine for investment, there are many factors that influence the way in which companies comply with the standards.

There will be an expansion of blackmail attacks aimed at companies and large corporations, due to the adoption of new legislation to criminalize data leakage incidents. In a world in which cybercriminals use sophisticated attacks to penetrate industrial companies, strong cybersecurity policies and regulatory compliance have never been as important as now, as countries gradually begin to adopt regulations and laws such as the case in Europe with the General Data Protection Regulation (GDPR), for example. However, Kasperskyâ&#x20AC;&#x2122;s report on the state of industrial cybersecurity in 2019 reveals that many companies are breaking the guidelines on reporting, possibly

to avoid penalties and public disclosure that could harm their reputation. In fact, the respondents stated that more than half (52%) of the incidents entailed a violation of the regulatory requirements, while 63% of them consider that the loss of trust of the clients in case of infraction is one of the main concerns.

CONCERN FOR CYBER RISK GROWS Technology is drastically transforming the global business environment, generating a wider range of interconnected and constantly changing risks, such as cyber risk. The Cyber Risk Perception Survey 2019 published by Marsh and Microsoft gathered the responses of more than 1,500 companies globally, about their vision of cyber risk. According to the survey, in Argentina, 64% of organizations classify cyber risk as one of their five main concerns, compared to 50% registered in 2017. Meanwhile, one in ten organizations consider it their number one risk. Likewise, the level of confidence in their ability to face cyber risk increased to 75%, of which 54% of them feel confident and 21% are very confident. However, 26% of companies in the country totally distrust their ability to respond to a cyber event.

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Regarding the areas responsible for managing cyber risk within an organization, 77% of respondents identified the Technology / Information Security area as the main responsible, followed by the Board of Directors (57%) and the Risks Management (32%). More than 40% of senior executives and members of the Board of Directors mentioned that they spent a few days in the last year focusing on the issue, while 45% spent only a few hours or less. At the same time, organizations continue to adopt new technologies, but are not sure of the risks they entail. 79% of respondents said they are adopting or considering adopting new technologies such as the cloud computing, robotics or artificial intelligence. 69% say they assess cyber risk both before and after adoption and 13% do not evaluate the risk at all. One in three organizations surveyed quantifies the economic impact of cyber risk, one in four companies surveyed evaluates it after an attack. This may be due to the lack of experience in the organization regarding these methodologies, the lack of resources (time and money), or the fact that many companies continue to consider cyber threats as a technological problem rather than as a strategic risk. On the other hand, the survey mentions that 56% of cyber risk investment

for the next three years will be focused on technology and mitigation, but not on all the elements that create resilience to this growing and changing risk. Edson Villar, regional leader for Latin America in Marsh Cyber Risk Consulting, mentioned: “Companies are becoming increasingly aware of this problem, but they are not yet prioritizing their resources in creating true resilience, that is, in identifying, quantifying, mitigate, transfer and plan their response in case of an incident.” According to the survey, 70% of the organizations consulted mention that one of the main triggers for the increase in cybersecurity investment is cyber attacks.

“All companies are investing in technology. We are in a cybersecurity boom due to digitalization in the world. Today everything is ‘smart’. This is found in various sectors such as agriculture (there is robotics for planting and environmental control, for example), mining, retail and commerce, which has been going on for several years, among others,” said José Carlos Vargas Medina, vice president at Isaca Lima Chapter and Chief Technological Risk at Falabella Bank. Currently, the financial and gaming sectors are undergoing major transformations, caused by constant technological innovations. That is why they migrate to web-based business models and the mobile ecosystem, to improve the customer experience. The incorporation of new applications such as Big Data, Google Analytics, Artificial Intelligence (AI), Blockchain and the conduct of online banking operations, even from mobile devices, have generated great benefits for institutions and customers. However, this represents a threat to sensitive documents of users and financial institutions, and a new challenge in terms of computer security. These sectors have become the perfect target for hackers, due to the large amount of customer data and financial assets that they can use to their advantage. Vargas Medina said that it is no longer a technological issue, but a concept linked to the value offer that the company has with its customers. “Now the company’s concern is not in operations or day to day, but in customer satisfaction. What is happening today is that the client has evolved throughout the world. Naturally, it has a cybersecurity requirement, without mentioning it directly,” he said. In that line, he explained that now we talk about ensuring the company’s growth and profitability, because technology has to provide that. “Nobody does business with someone who is not reliable. That is the basic rule,” he emphasized.

64% of organizations classify cyber risk as one of their five main concerns, compared to 50% registered in 2017.

THREATS ON THE WEB AFFECT THE INDUSTRY Over the years, large companies have become the target of cyber attacks. Technological advances have shown that they are increasingly vulnerable and leave their information exposed and defenseless. Cybersecurity strives to protect the data stored in computer systems and thus prevent unauthorized entry.

Cybersecurity is crucial to face the new digital era.

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REPORT

In the main markets

THE STATUS OF GAMBLING REGULATION IN THE EUROPEAN UNION Most EU countries allow at least some games of chance to be offered. Some countries allow all games, while others only allow certain types such as betting, poker or casino games.

lthough Europe is very much considered a “single state” in terms of economic significance, and is to some extent governed by legislation passed by the European Union, the individual countries are still ultimately responsible for passing their own laws. This is particularly true within the gambling industry since there’s no legislation or regulation that standardizes betting and gaming throughout Europe. There is no sector-specific European Union (EU) legislation in the field of gambling services. EU countries are autonomous in the way they organise their gambling services, as long as they comply with the fundamental free-

doms established under the Treaty on the Functioning of the European Union (TFEU), as interpreted by the Court of Justice of the European Union. Most EU countries allow at least some games of chance to be offered on the Internet. Some countries allow all games, while others only allow certain types such as betting, poker or casino games. In some European jurisdictions, monopolistic regimes offering online gambling services have been established. These are run by a state-controlled public operator or by a private operator on the basis of an exclusive right. However, a growing number of EU countries have established licensing

There’s no legislation or regulation that standardizes betting and gaming throughout Europe.

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systems that allow more than one operator to offer services on the market. Under European Union law, no particular system is favoured over the others. Online gambling regulation in EU countries is characterised by diverse regulatory frameworks. In a number of judgements, the Court of Justice of the European Union (CJEU) has ruled on the compliance of national regulatory frameworks with EU law. The Commission supports EU countries’ efforts to modernise their national online gambling legal frameworks, in particular in the framework of administrative cooperation between

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gambling regulatory authorities. It also provides support to ensure a high level of protection for consumers and vulnerable people, including minors.

UNITED KINGDOM The United Kingdom Gambling Commission (UKGC) has been one of the strictest in gambling regulations within the EU. They have recently stated that UK gamblers spend 14.5 GBP per year and this figure is growing each year. One of the most controversial moves that they have made recently is to limit the amount that players can wager on fixed-odds betting terminals within bookmakers.

Previously players could wager up to 100 GBP per go at these terminals before the law change, it is now limited to a maximum of 2 GBP per wager. The move prompted William Hill, to close an estimated 700 shops of their own. They sighted the loss of profits caused by this new regulation as the reason for the closures nationwide. However, the government has argued that such easy access to high stakes gambling was leading to widespread social issues amongst some of the poorest and most vulnerable groups in society. Many casinos and bookmakers, have been hit with large

fines from the UKGC within the past few years. The regulator has taken steps against even the biggest names in the industry to stamp its authority on the market within the UK. Perhaps most notable of the gambling companies sanctioned by the UK Gambling Commission is the Ladbrokes Coral Group. The commission ordered the operator to pay 5.9 million GBP for previous failures to abide by anti-money laundering regulations. It has also called out the company for failing to protect problem gamblers at both firms after thorough investigations of the group. FEBRUARY 2020

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Gambling regulation in the European Union.

GERMANY The gambling laws in Germany are somewhat complex, and have changed a few times over the years. In 2008 legislation was introduced that effectively banned all forms of online gaming and betting, with the exception of horse racing betting, other than those offered by the state. The European Gaming and Betting Association (EGBA) led a challenge to this legislation, claiming that it breached EU rules. In 2010, it was ruled by the European Court of Justice that the industry was monopolized in Germany and had to become more liberal. As a result the Interstate Treat on Gambling (ISTG) was introduced in 2012 which allowed private companies to provide some gambling services. The ISTG was implemented in all German states but one, Schleswig Holstein, which passed its own legislation which was even more liberal. This legislation was scrapped in 2013, by a newly elected government, but the licenses previously issued by Schleswig Holstein still have several years to run (until 2018). Many established operators hold one of these li40

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censes as Germany is one of Europeâ&#x20AC;&#x2122;s biggest gambling markets.

SPAIN Spain has amended its gambling laws several times in recent years. The most recent changes took effect in 2012, when operators could apply for licenses to operate in the region subject to certain conditions. Several companies were successfully awarded licenses by the Spanish National Gaming Commission and were able to operate accordingly. At this time, itâ&#x20AC;&#x2122;s legal for Spanish residents to bet and play at any of the sites licensed in the country. Many of the biggest and best known brands, such as Bet365 and William Hill, have dedicated Spanish sites for betting, poker, and some other forms of gambling.

BELGIUM Belgium has been among the toughest countries when it comes to the regulation of on and offline gambling. This has been highlighted recently with the decision from Nintendo not to release the iOS or Android ver-

sion of Mario Kart Tour for download in the country. The decision was taken as the game features the use of loot boxes when players are rewarded for their achievements in the app. Nintendo stated that the use of loot boxes does not comply with Belgian Gambling Authority regulations as they are seen to amount to gambling. This is despite the fact that the feature in the game does not use any form of real-world currency. It just goes to highlight how tough the regulations are in Belgium. This comes after the advertising of online casino games on television has been banned throughout Belgium as slots are seen as promoting gambling. Sports betting adverts are still allowed but are heavily restricted. Adverts for sportsbooks cannot be shown during live sports broadcasts though they are permitted before and during events.

ITALY Compared to many other European countries, the gambling laws in Italy are fairly liberal. In 2006, at a time when many other European

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Union members were introducing or increasing restrictions on gambling, Italy introduced legislation allowing companies to provide sports betting services in retail locations and over the Internet. Several changes were made to this legislation, including one in 2011 which allowed licensees to provide poker and casino games to customers too. As a result, Italians have a wide choice of licensed sites they can join for several different forms of gambling. This update to the Italian gambling laws has allowed online gambling companies to tap into this highly lucrative market. There’s a population of over 60 million people in Italy, making it the third-largest population in the EU. Another boon to the Italian gambling market is the fact that Italian players are not taxed on their winnings. It is instead the operators who shoulder any tax burden through taxes on revenues as well as licensing fees. Despite the increase in access to online and physical gambling spaces in Italy, there has been a clampdown on the advertising of gambling. Italy’s advertising and communications regulator Autorità per le Garanzie nelle Comunicazioni (AGCOM) has recently confirmed that direct and indirect advertising, sponsorship or promotional communications will all be banned across the country.

NETHERLANDS The state monopoly on online and land-based casinos is finally broken in the country. The Dutch gambling sector has received new legislations after the Remote Gaming Bill was adopted by the Senate at the end of February of last year. According to the law, Holland Casino platform will no longer be the only one available for the players of the country because foreign operators will enter the market in 2020. Starting from this year, operators will be able to obtain a gambling license in the Netherlands. However, high taxes (29 of the gross revenue) are going to be an obligation for operators. Furthermore, they will also be obliged to pay another 1.5% to fund the local regulator, as well as 0.5% to Support anti-gambling programs.

FRANCE Many forms of gambling are legal in France, and there are three main bodies responsible for its regulation. The Pari Mutuel Urbain deals with horse racing, the Francaise des Jeux deals with betting games and lotteries, and ARJEL deals with online gambling. In 2009, the French government introduced a new legislative bill relating to online gambling, following requests from the European Union, and in 2010 three forms of online gambling were officially legalized.

They were sports betting (including live betting, fixed odds betting, and pool betting), horse racing betting (pool betting only) and poker. Licenses are issued by ARJEL to operators wishing to provide these services to French residents. At this time licenses aren’t issued for casino games, spread betting, or exchange betting.

SWEDEN Sweden brought a new wave of laws which aimed to end the state-run online gambling company’s monopoly. The laws aimed to open up the market to private operators in the future and help to expand the gambling market in the country. For many years the state-owned Svenska Spel was the only company permitted to offer online gambling to people in Sweden. This applied to all types of games, whether it be casino games, sports betting, or other forms of casino entertainment. Despite the law, many gambling companies found a way around the regulations and by 2018 private companies had captured a 29% share of the Swedish gambling industry as a whole. At the time the country’s gambling industry was estimated to be worth a staggering USD 2.5 billion. It is hoped that whilst the new regulations open up the Swedish market to new operators, it will also help to protect the public against any actions from the gambling companies.

SWITZERLAND

Most EU countries allow at least some games of chance to be offered on the Internet.

There are two levels of gambling laws in Switzerland — federal and cantonal (state). Casino licenses are given through the Swiss Federal Casino Commission (ESBK). Lotteries and sports betting are managed through Comlot, the Swiss Lottery and Betting Board. In 2018, the Money Gaming Act was passed to block the IP addresses of foreign gambling sites. This was done to force operators to pay their fair share of taxes. The law went into effect in January 2019 with a transitional phase allowing some sites and apps to remain accessible through June. As of the end of June, all unlicensed gambling options are blocked. FEBRUARY 2020

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eSports

ONE OF THE INDUSTRY’S FASTEST GROWING WAGERING SECTORS During ICE London 2020, Clarion Gaming will co-host a 250,000 dollars prize money professional eSports tournament that will be live broadcast to an online global audience in excess of 5 million.

rganized competitive video gaming, or eSports, is one of the fastest growing types of entertainment and competition in the world. Starting with local area network video game competitions mostly between friends in the late 1990s, eSports has 42

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grown into an international cultural phenomenon, with many different video games (such as League of Legends, Counter-Strike: Global Offensive, Dota 2, and FIFA) serving as an avenue of competition for players and teams from many countries across the globe.

That’s why the number of people set to experience ICE London 2020 is set to grow exponentially following Clarion Gaming’s decision to co-host a 250,000 dollars prize money professional eSports tournament that will be live broadcast to an online global audience in excess of 5 million.

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“Clarion Gaming’s mandate is to provide platforms to inform the entire industry and I believe the addition of the Esports Arena fits into that model perfectly. ICE London has a phenomenal reputation and is at the forefront of innovation not just across gaming but in the entire events industry and this new feature will truly allow visitors to ‘Dive into the future’. The Esports Arena will be the one-stop shop to learn and experience everything about eSports and introduce a whole new world of bettors. Insight expert presentations will explain how to attract an audience that has perhaps previously been difficult to engage with. There will also be ‘how-to’ guides focussing on generating revenue and maximising ROI,” explained Harding. “We want to give an authentic eSports experience in ways which have never been seen before. We will have eight of the best Counter Strike teams in the world competing, playing real time games which will be streamed to real fans around the world, all of which will be live on the ICE London showfloor. For land-

based operators interested in how to produce a tournament, we will be effectively building an authentic eSport show live in front of them. Highlighting the level of production necessary to deliver a tournament on this scale, the arena will allow delegates to go behind the scenes with our production team as well as providing player interviews throughout the competition, showcase broadcast editing insights and deliver tournament structure and data/performance analysis. The educational auditorium will feature a full schedule of presentations on topics such as how to use esport data to create odds, esport recruiting and esport wagering,” Harding added. “With market reports showing registered eSports wagering of 5.6 billions dollars in 2015 has grown to $13 billion this year, it’s going to be one of the must attend features at ICE London for operators and gaming brands alike. Through this unique event experience, we aim to provide the industry with a one-stop education space and deliver something far beyond anything else that’s been done before in terms of esports education for

The Esports Arena will be the one-stop shop to learn and experience everything about eSports and introduce a whole new world of bettors.

The initiative, which is being undertaken in partnership with GG.Bet, will comprise an 800 square meter Esports Arena featuring a custom built stage, an educational auditorium, commentator ICE box, partner data.bet lounge, a themed bar and a betting hatch allowing players to “bet” ICE and GG.Bet dollars in order to simulate eSports wagering. Described by Clarion’s recently appointed Head of eSports, William Harding, as representing a “global industry first”, ICE London’s Esports Arena will provide visitors with the practical tool kit and strategic insights to take full commercial advantage of what is one of the industry’s fastest growing wagering sectors. The live event, which will be streamed to eSports fans worldwide, is only open to over 18-year-old, B2B delegates.

A visual representation of ICE London’s Esports Arena.

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REPORT

Today’s prize pools are large enough that players can often retire upon winning them.

the gaming sector,” said the Head of eSports at Clarion Gaming. The top tier global eSports team Natus Vincere (NAVI) have been confirmed as one of the eight eSports teams competing for the prize. ICE London’s Esports Arena tournament is set to break attendance records at the 2020 exhibition. Commenting on the signing of NAVI to the tournament and the new feature’s estimated impact on ICE London’s audience, Harding explained: “With our eSports tournament being broadcast live to an online global audience in excess of 5 million, we are expecting to see the number of people experiencing ICE London 2020 to grow heavily. They have an unprecedented connection to their fans, with over 7.5 million followers across all social media channels and having won over 10 million USD in several eSports games, they are considered as one of the favourites for the ICE Esports Arena competition. With this launch comes many sponsorship opportunities available for gaming companies to really get their stamp on this exciting ICE 2020 launch, including bar happy hours, auditorium co-sponsorship and sponsored speaking slots.”

The growth has been so explosive that it’s been estimated that the global eSports betting market will be worth nearly 30 billion dollars by 2020. That’s a massive figure, especially when its consider that eSports are still “under the radar” to some extent. The eSports fanbase is huge these days, but it’s nowhere near as big as the fanbases for traditional sports such as soccer, football and tennis. Most people outside of those types of fanbases don’t have any idea what eSports are all about. As one of the fastest growing categories in online gambling, eSports betting is on pace to reach up to 8 billion in total wagers, equating to 560 million in revenue at

an industry average margin of 7 percent. Growth estimates point to more than 16 billion in annual wagers in coming years. There is huge potential for synergy and collaboration between the eSports and gaming, and gambling industries. Gaming already has the attention of Millennials and Generation Z. Betting operators have moved online with traditional gambling to attract these generations. Now eSports is a new route for gambling companies to connect with younger consumers and avid gamers, and not just online either. Globally, more and more online gambling web sites are adding eSports betting sections. As per Casino.org and betting consultant NJGames.org there was 5.5 billion gambled on eSports in 2016 but this figure is expected to reach 12.9 billion dollars in 2020. NJGames names eSports wagers the fastest growing betting trend in sports gambling. The sports betting market is currently valued at 250 billion and around 40 billion in sports betting takes place online. The amounts wagered worldwide on eSports betting are steadily growing, starting from 315 million dollars back in 2015 to 7 billion in 2018, wich is estimated to double by 2020. The base projection for the amount of customers placing eSports wagers in 2020 is 6.5 million. When its comes to the games themselves, the most popular eSports game on the gambling market was League of Legends (LoL), as approximately 38 per-

HOW BIG CAN THE MARKET BE? Betting on eSports is a big thing right now. This (relatively) new type of betting got off to a slow start, but it has gained a lot of traction over the last couple of years. 44

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More and more online gambling web sites are adding eSports betting sections.

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cent of the total eSportsbook amount wagered was attributed to bets placed on LoL. This is followed by Counter-Strike: Global Offensive (CS:GO), with 29 percent of the betting volume.

BIGGEST PRIZE POOL IN THE WORLD All around the world, eSports are on the rise and they don’t look to be slowing down any time soon. Players have seen some big payouts over the last five years. While the overall size of a prize pool doesn’t determine the prestige of an event, it’s one of the major factors players use to determine whether they’ll show up. The first eSports prize was given away in 1997 when Dennis “Thresh” Fong won Quake developer John Carmac’s red Ferrari 328. In 2006, Johan “Toxjq” Quick won a Rolex from the WSVG Quake 4 championship. Those were certainly remarkable in their time. But today’s prize pools are large enough that players can often retire upon winning them. As the popularity of games such as CS:GO and Dota 2 grew, more money poured into the industry, which created more opportunities for betting and gambling to rise. This is unsurprising considering the amount of money on the line in the top eSports tournaments. The prize pool for the League of Legends 2017 Season World Championship was 4,5 million. For the 2018 Call of Duty World League Championships, the prize was 1.5 million. The International, Valve’s annual world championship in Dota 2, has broken the record for eSports prize pools for nine years in a row. While offering a total of 1.6 million dollars in 2011 and 2012, since 2013, the event has been the most successful example of crowdfunded prize pools in eSports history. On the most recent iteration of the event, The International 2019, teams all over the world fought for a slice of an over 33 million dollars prize pool.

CONCERNS OF CORRUPTION Esports gambling is not without constraints and concerns. As with traditional sports, preventing match-fixing is a priority to maintain credibility for the industry. As the rapidly growing phenomenon

The International 2019.

surrounding eSports continues to gather steam, the intersection of gaming and sports offers an innovative wave of branding opportunities, engaging content and activations for millions across the world. In this context, one of the most significant challenges will be legislation. Since it is an emerging industry, many jurisdictions lack clear rules to regulate the eSports gambling sector, especially in the case of player age verification and skin gambling.

It’s been estimated that the global eSports betting market will be worth nearly 30 billion dollars by 2020. There are a number of other roadblocks. Gambling operators need to understand how to garner the interest of younger generations whilst also being careful. Many eSports players and their fans are under the age of 21. In New Jersey, US bets cannot be taken on a team with a player under 18. Operators need to be approaching regulators for permissions but to do so they have to be confident in the opportunity of eSports gambling and how to make the most of it. Overall the gambling industry may need clear regulatory pa-

rameters to take advantage of the potential in eSports betting. Today, confronted with anti-corruption measures within traditional sports, organized crime are aggressively expanding into new markets, hoping to stay one step ahead of enforcement. The rise in eSports betting brings with it the unwelcome, and often unwitting, participation in activities such as match fixing and point-shaving, which endanger legitimate wagering, the players and teams, and esports as a whole. Concerns of corruption are more than mere speculation. There were 39 significant alerts into potential match-fixing in 2017, as fears grow that esports is vulnerable. Esports has already suffered match-fixing scandals, concentrated in South Korea and China, resulting in bans, fines, and arrests. Corruption risks are particularly pronounced in esports since cohesive regulations, governing body, structure, or standards across the entire competitive ecosystem do not currently exist. Perhaps no game, or more accurately collection of games, is harder to regulate than eSports. Unlike traditional sports, which have fairly well established “rules of the road,” eSports is widely fragmented, with each game Publisher controlling its own game or games. Thus, a publisher of one game often has no insight into activities of players in a game published and controlled by another company. FEBRUARY 2020

INTERVIEW

DRGT

A NEW DECADE: WHERE THE PLAYER EXPERIENCE WILL DEFINE SUCCESS The company is sure that operators need to understand who are best suited to service their players, they then need to employ and train these like-minded individuals. can operations. The relationships and network that both of these businesses have given us access to over the last 12 months has been invaluable, part of what you will see on our booth at ICE will bear testament to that.

That’s a nice feather in the caps of both DRGT and GPI. JM: It is indeed, but don’t let Charl

R Gaming Technology’s CEO, Jurgen De Munck, MD: Africa, Charl Geyser and MD: DRGT Online, Jean-Michel De Busscher talk about their plans for ICE 2020, the history of the company and what they believe the new decade holds in store.

DRGT was established in 2005, and Jurgen the company really is your and Michiel’s (van Dam, CTOs) baby. JM: Yes, that’s right; we’ve been very fortunate; the company has really grown from strength to strength over the last 15-odd years, thanks to Michiel and his team of developers, and the likes of Charl and Jean-Michel across Africa and in Belgium, as well as Alfredo (Moreno) and Alex (Stiglich) our Mexico and Latin America MDs and their teams, along with Christian Eder and his team in Austria. 46

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be so modest. The relationships he has across Africa following not only his establishment of Simplicit-e Gaming in 2009, but also as a result of his 13 years with Aristocrat are of immense value to us too; DRGT Africa was without a doubt a winwin for all three parties.

Charl, towards the end of 2018 your baby, Simplicit-e Gaming Solutions, became DRGT Africa, what effect, if any, has this joint venture between DRGT and Grand Parade Investments (GPI) had on the company’s African and Indian Ocean island business over the last year? CG: Ahead of me answering your question let me just note that my relationship with DRGT dates back almost a decade, to when I took on the distribution of the then SiP product, subsequent to which I met Jurgen and Michiel when they purchased SiP in late 2011. To answer your question though, the value that DRGT as an internationally recognised developer and supplier, alongside GPI a well-respected South African gaming investor and former operator have added significant gravitas to our Afri-

Let’s move from Africa to Europe; Jean-Michel, as the head of DRGT’s Belgian distributor business, ICE must surely be your key operator engagement opportunity? JB: Without a doubt. Just as G2E remains an integral part of our Mexican and Latin American and Caribbean marketing efforts, ICE fulfils that role for our European and African endeavours. As you may know we are the management system market-leaders, by some significant margin, in our home country of Belgium, as well as in Switzerland, and as a result we remain under significant pressure from our competitors, and rightly so, to maintain that status. Jurgen mentioned Michiel and his R&D teams earlier; I believe that our market leadership is jointly driven by our system augmentations, new products,

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and product extensions, alongside our operations and service support efforts. Together they keep us that proverbial “step ahead of the pack”.

That’s an interesting point you make: that notwithstanding the fact that your success is driven by technology, it would never have reached the heights it has without the support from the operations staff who are at the coal face engaging and servicing your customers. Who though, or what, drives your on-going product development? It is integral to any businesses’ success. CG: You are 100% correct, in fact

Jurgen De Munck.

in an interview I did last month I made it quite clear that in my view, in respect of not only 2020, but the new decade, that the player experience, is going to be what defines and drives operator success and sustainability in the foreseeable future. The above view mirrors what was, and remains, Jurgen and Michiel’s unwavering design mantra of “The Player First”.

The player experience, is going to be what defines and drives operator success and sustainability in the foreseeable future. JB: I cannot agree more. As the saying goes people like doing business with people they like, and similarly players like playing at establishments they like, and generally those are establishments that genuinely appreciate their players and their custom. The core gaming products whether they be EGMs, table games and any iterations thereof are available to each and every operator on the planet, within reason. They are a commodity if you like, and remaining relevant in that space is a whole separate

Charl Geyser.

Jean-Michel De Busscher.

discussion; where I see us having set ourselves apart, and where I believe we provide the best option in assisting operators in setting themselves apart, is our ability to help operators measure, understand, manage and then engage and communicate with their players.

sult of the way we were treated when addressing an issue, not as a result of the actual issue itself. The whole process has become extremely integrated; operators need to understand who are best suited to service their players, they then need to employ and train these like-minded individuals. We as systems service providers then need to provide these staff with the means to get to know and understand each and every player individually (the much talked about “player segment of one”), and finally these staff then need to go out and do what they do best, fully cognisant of their capabilities, and the fact that they are empowered and armed with the tools and knowledge to make the correct player-centric decisions.

So, if the player experience holds the defining key, how do casino operators go about delivering it? JM: I believe the answer to that question is by hiring and training staff with the right attitude, then arming them with knowledge, and finally empowering them to make player-centric decisions. We have all had poor customer service experiences, and in most cases it has been as a re-

FEBRUARY 2020

REPORT

A cashless world

PAYMENT SOLUTIONS, THE FUTURE OF THE GAMING INDUSTRY As gaming continues to expand and explore digital channels, new ways to pay will continue to emerge to cater to this market and facilitate a more seamless customer experience.

igital channels are increasingly being adopted in the gaming industry. Juniper Research estimates that online gambling will draw over USD 1 trillion in revenues by 2021, while gaming using emerging technologies such as virtual reality is expected to rise by over 800 percent in the same time frame. As gaming continues to expand and explore digital channels, new ways to pay will continue to emerge to cater to 48

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this market and facilitate a more seamless customer experience. A new era of payments has emerged in gaming. For gamers, this new era heralds unparalleled freedom and flexibility to pay in the manner most convenient and relevant to them. While for operators, huge opportunities for differentiation and competitive edge will present themselves to those who can adapt to the change of pace. “Implement-

ing a seamless payment offering that integrates elements of both traditional and digital methods will not only offer a heightened experience, but ultimately increase customer loyalty”, said Neil Erlick, Executive Vice-President of Business Development at Paysafe Group. “Customers prefer to use cash because it is easier to control. Most players arrive at casino floors with a preestablished budget in their pocket,

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however, we have to ask the question: cash is still a way to increase player loyalty?”, said Rudi Borgato, Sales Manager for Latin America of Crane Payment Innovations (CPI), during a debate at SAGSE 2019 in Buenos Aires. The executive explained that operators continue to prefer cash because it guarantees cash flow, does not require special technology to process it and is easy to reconcile. In addition, he said that debit and credit cards have a payment processing charge, while cash does not. However, Borgato proposed different scenarios that are leading to rethinking payment operations in casino floors: “The problem is that players seek convenience when they want to buy a service at the same time they are playing. That is why each slot machine must allow to acquire those services on the same screen and with the payment method that the client requires. This would increase consumer satisfaction.” As was explained by the Sales Manager, another inconvenience that current players are having is that they are looking for personalized experiences and to have less waiting time at the cash-box to buy chips because the game tables do not accept TITO or electronic ways of payment. “It is necessary that each game table has new payment mechanisms to

Digital channels are increasingly being adopted in the gaming industry.

For gamers, this new era heralds unparalleled freedom and flexibility to pay in the manner most convenient and relevant to them.

Traditional cash continues to have a clear place in the gaming industry.

allow greater speed in bets. For gaming, cash will remain the leader in payment method, however, we will have to start advancing in other means of payment,” concluded Borgato.

CASHLESS? Traditional cash, coins and notes, continue to have a clear place in the gaming industry. They’re quick, private, and easily authenticated in the majority of cases. These benefits combined mean cash is still a relevant and convenient way to pay in gaming, but this doesn’t necessarily pose an obstacle to the rise of new forms of digital cash in the industry. “Indeed, our research shows that rather than cash and digital competing with each other, the sweet spot is often how cash is merging with digital formats. This is demonstrated by the rise of alternative payment methods, including voucher based systems and digital wallets which are convenient, enable instant transfers to gamers’ accounts and access to a much larger consumer base,” said Erlick. However, these new payment solutions are not without their challenges. The gaming sector is highly regulated which means that the introduction and integration of these payment methods can be a fairly lengthy process, especially as regulations vary significantly across geographical borders. So, while cashFEBRUARY 2020

REPORT

less, or new forms of digital cash, may be on the rise in the gaming industry, there is still work to be done before it can be consider that this growth is sustainable. Regulation and consumer adoption obscures the timeline on the evolution of a cashless society, but it is certain that going cashless will become more prevalent over time, which is evident in the gaming industry’s digital transformation to date, explained the executive. Consider the industry’s evolution over the last eighty years, particularly in gaming hotspots like Las Vegas, in which gambling was traditionally the undisputed focal point of casinos. “Today, gambling forms just one pillar of the entire casino experience, alongside entertainment, cuisine, sightseeing and social appeals. The entire gaming experience has completely transformed over time, and will continue to change in the future. The way people pay is just one element of gaming and we can expect to see both alternative payments and cash evolve in the years to come alongside the wider consumer experience,” added Erlick.

DIGITAL WALLETS Consumer spend via digital wallets across Europe and North America will increase by 40% this year to nearly $790 billion, according to a new study from Juniper Research. The largest growth in 2019 would come from instore payments, with mobile contactless payments more than doubling across these regions. The study “Digital Wallets: Service Provider Analysis, Market Opportunities & Forecasts 20192024”, found that while eRetail spend through wallets would remain the largest contributor to consumer spend, continued migration from cash would see a surge in wallet use at Points of Sale (POS). The document explained that this was particularly the case amongst

Game tables usually do not accept TITO or electronic ways of payment.

younger demographics and in the US, where a third of iPhones are now used for contactless payments. The report highlighted the importance of digital wallet providers establishing partnerships with leading banks to maximise reach amongst consumers. Juniper Research’s analysis found that Apple far outstripped its rivals; achieving the largest addressable share of banking consumers in 7 of the 10 national markets assessed. In the online space, the study found that wallets, including Apple Pay, Amazon Pay and Visa Checkout, had also significantly expanded their availability at merchant sites, although all lagged well behind PayPal in this regard. Meanwhile, social payments through wallets will grow strongly both this year

Rather than cash and digital competing with each other, the sweet spot is often how cash is merging with digital formats.

FEBRUARY 2020

and beyond; a trend expected to be accelerated in the middle of 2020 by the emergence of Facebook’s Calibra wallet and its attendant Libra cryptocurrency. However, the study was less optimistic about prospects for Wearable-Pay wallets; arguing that their limited addressable bases and functional constraints meant they would struggle against converged wallets - providing an extensive portfolio of online and offline payment offerings. Juniper Research Analyst, Nick Maynard, said: “Wearable-Pay solutions are still completely dependent on the smartphone and are ultimately limited to a single use case. They are thus likely to remain, at best, a niche offering.” Also, Juniper Research has shown that revenue from payment platforms that enables merchants to process payments will grow from USD 106 billion in 2019 to 158 billion by 2024. The study forecasts over half of global revenue will be generated in China by 2024; primarily owing to its increasing affluence and vast usage of social payments such as WeChat Pay.

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The technology offers greater transparency and traceability

GAMING WILL BE RESPONSIBLE FOR THE MASS ADOPTION OF BLOCKCHAIN

To date it’s one of the sectors in which this adoption is more developed, considering that for example, the first online casinos have started to use Bitcoin as early as 2013.

s a distributed, tamperproof ledger, a well-designed blockchain doesn’t just cut out intermediaries, reduce costs, and increase speed and reach. It also offers greater transparency and traceability for many business processes. Gartner forecasts that blockchain will generate an annual business value of more than USD 3 trillion FEBRUARY 2020

by 2030. It’s possible to imagine that 10% to 20% of global economic infrastructure will be running on blockchainbased systems by that same year. The gaming sector is one of the most interesting ones to debate about when it comes to Bitcoin (BTC) and the blockchain world in general. According to many industry analysts, it will be

the driving industry responsible for the mass adoption of blockchain technology. Indeed, to date it’s one of the sectors in which this adoption is more developed, considering that for example, the first online casinos have started to use BTC as early as 2013. Moreover, gambling is increasingly using the blockchain because it is verifiFEBRUARY 2018

REPORT

able, traceable and allows very fast transactions. Sometimes, there is a lack of transparency in traditional gambling, not to mention slow and expensive transactions that make deposits and withdrawals of funds bothersome. Using blockchain, on the other hand, allows for better protection of user information, increases inclusiveness and multiplies opportunities. Furthermore, cryptocurrencies allow players to gamble online without additional controls on their finances. In particular, platforms that use only cryptocurrencies are in fact exempt from most of the laws to which traditional platforms using fiat currencies are subject. This does not mean that they operate illegally without any kind of authorisation, but only that they are required to comply with a smaller amount of regulations. According to the UK Gambling Commission, trust in gaming and overall public attitudes to gaming are in decline. By delivering transparency and player protection through decentralised, fair technology, the blockchain technology is set to reverse these trends. Consumer concerns over the fairness of games and integrity of online casinos have existed since the outset of Internet gaming. Although the number of un-

trustworthy operators is relatively small, high profile cases of cheating, a lack of transparency in game software (run from remote gaming servers) and unreliable cashout processes has fed a growing perception that online gaming is unfair. The ability of players to easily verify that a game has run fairly, without interference and according to its agreed set of rules, is a key component of blockchain-based gaming technology.

Gartner forecasts that blockchain will generate an annual business value of more than USD 3 trillion by 2030. All current online casinos (and even â&#x20AC;&#x153;Bitcoin casinosâ&#x20AC;?) require players to deposit funds with them before they can play. In many top tier jurisdictions, player funds are not fully protected if the casino becomes insolvent, nor are casinos required to prove their ability to payout

large wins. The risks involved in giving up custody of funds and having faith that casinos will pay out in the event of large wins are not lost on consumers, with 1 in 5 worried about safety of funds in an Australian regulator survey. This is resolved with the ability to play games using funds directly from a crypto wallet which enables players on the casino platform to retain control over their funds at all times. Player and casino are both required to send funds for each gaming session to a smart contract escrow, eliminating the possibility that a casino misappropriates player funds, leaves a shortfall in the event of insolvency or is unable (or unwilling) to promptly pay out a win of any size. Currently, it is compulsory for players in many gaming jurisdictions to complete a verification process for each casino they join. Lengthy verification, registration and payment processes are common causes of incomplete registration, failure to convert (deposit funds and play for real money) and single logins (where a player never returns after their initial visit). This could be resolved with blockchain-based gaming technology. Also, the tightening of global restrictions on online gambling is resulting in

Gambling is increasingly using the blockchain because it is verifiable, traceable and allows very fast transactions.

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There are many indications that blockchain is fundamentally altering the business landscape.

higher market shares for cryptocurrencybased platforms compared to platforms that use fiat currencies, and although these two types of platforms are likely to coexist in the future, those that use only cryptocurrencies could attract an increasing number of users. In addition, blockchain-based gambling platforms could in the future offer new innovative games that do not exist on traditional platforms and this could constitute a further incentive.

HOW BLOCKCHAIN IS CHANGING BUSINESS There are many indications that blockchain is fundamentally altering the business landscape. Tokenisation is one of them. This is the representation of real or virtual assets on a blockchain, is spreading to raw materials, finished goods, income-producing securities, membership rights and more. Initial coin offerings (ICOs), in which a company sells a predefined number of digital tokens to the public, are funnelling billions of dollars into blockchain platforms. Increasingly an alternative to classic debt/capital funding as provided today by venture capital and private equity firms and banks, ICOs in only the first half of 2018 raised $13.7 billion. Enterprise software platforms that are the engine for company operations such as finance, human resources and customer relationship management are beginning to integrate blockchain. For example, Microsoft, Oracle, SAP and

Salesforce have all announced blockchain initiatives. In the future, many core business processes will run on — or interoperate with — blockchain-based systems. Using blockchain in concert with enterprise resource planning platforms will enable companies to streamline processes, facilitate data sharing and improve data integrity.

The tightening of global restrictions on online gambling is resulting in higher market shares for cryptocurrency-based platforms compared to platforms that use fiat currencies. Gartner has found that 82% of reported blockchain use cases were in financial services in 2017, but that sector’s portion dropped to 46% of reported use cases in 2018. A study from PwC explained that it is still perceive financial services to be one of the leaders of blockchain, but also see potential in industrial products, gaming, energy and utilities and healthcare. Moreover, an early centre of gravity in the US and Europe is shifting. The document also described that the US is the most advanced territory in developing

blockchain today, but that in three to five years, the leader will be China.

WHY IT’S HARD TO TRUST A BLOCKCHAIN Blockchain, by its very definition, should engender trust. But in reality, companies confront trust issues at nearly every turn. For one, users must build confidence in the technology itself. As with any emerging technology, challenges and doubts exist around blockchain’s reliability, speed, security and scalability. And there are concerns regarding a lack of standardisation and the potential lack of interoperability with other blockchains. Also contributing to the blockchain trust gap is a lack of understanding. Even now, according to PwC, many executives are unclear on what blockchain really is and how it is changing all facets of business. Although the public narrative has moved beyond Bitcoin, even the more recent focus and hype around ICOs only hint at the potential impact. Blockchain’s role as a dual-pronged change agent — as a new form of infrastructure and as a new way to digitise assets through tokens, including cryptocurrency — is not easy to explain. Think about other new technologies: users can try on virtual reality goggles or watch a drone take flight. But blockchain is abstract, technical and happening behind the scenes. Another challenge for blockchain is building trust in the network. It is perhaps ironic that a technology meant to bring consensus hits a stumbling block on the early need to design rules and standards. Take payment systems and mechanisms in banking. Though everyone plays by the rules of existing systems today, they don’t necessarily agree on how an alternative blockchain-based model should be designed and operated. Likewise, there’s a lack of comfort regarding regulation. The majority of regulators are still coming to terms with blockchain and cryptocurrency. Many territories have begun studying and discussing the issues, particularly as they relate to financial services, but the overall regulatory environment remains unsettled. FEBRUARY 2020

UK / REPORT

UK National Lottery

THE 2020 TENDER It will be one of the great stories of the year in the field of lotteries, with Camelot as operator for 25 years and the confirmation of four competitors at least: the premises Sir Richard Branson and Richard Desmond, the recently privatized Franรงaise des Jeux and Sazka Group, which finishes acquiring the majority of OPAP from Greece.

Franรงaise des Jeux.

he United Kingdom has had a lottery since 1694, when the state first authorized the Million Lottery (1694) and then the Malt Lottery (1697). These Lotteries were part of a series of financial experiments by the English government including recoinage and the foundation of the Bank of England to raise the capital available to the state. The modern era began 300 years later. The UK National Lottery was launched on 14 November 1994 and the first draw took place five days later. The

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Camelot company - owned by Cadbury Schweppes, bank note printer De La Rue, telecoms group Racal, US computer company GTech and British computer firm ICL - beat off seven other contenders for the first tender. On December 19, 2000, the link was extended for another seven years. Also, on February 1, 2009 the third license comes into force, for a period of 10 years. On 25 March 2010 the five shareholders in Camelot (Cadbury Schweppes, Royal Mail Enterprises, De La Rue, Fu-

jitsu Services and Thales Electronics) announced that they had agreed to sell their shareholdings to the Ontario Teachers Pension Plan (OTPP). This agreement was subject to regulatory approval from the National Lottery Commission whose consent was required before the sale could be completed. The operation was confirmed a few months later. According to official data, since 1994 the National Lottery has become an institution within the UK, raising over ยฃ 40 billion for good causes and paying out over

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£ 59 billion in prizes. In November 2019, National Lottery operator Camelot UK has celebrated its 25th year in operations by recording a 13.5% growth in the total number of National Lottery tickets sold over the first half of its 2019/20 financial year. Among many game options, National Lottery games consists of draw-based games such as Lotto and EuroMillions, scratchcards with prices ranging between £ 1 to £ 5, and online interactive instant win games, which can range from 25p to £ 10. The average breakdown for every £1 of ticket sales in 2018/19 was: 56% paid to winners in prizes; 22% given to good causes; 12% to the government in lottery duty; 4% paid to National Lottery retailers on tickets sold; 6% retained by the operator to meet costs and returns to shareholders. Publishing figures for the period 1 April to 28 September 2019, the lottery operator generated £ 876.8m (excluding investment returns) for Good Causes, £ 83.6m more than in the first half of 2018/19. Over the same period, Camelot also awarded £ 2,238.4m in prizes to players, (+ £ 265.3m than 2018). The group celebrated its contribution to more than 565,000 individual projects. But the structure of the current lottery has different characteristics from that of yesteryear. The company identified its growth across its digital platforms as a key driver of growth for the group, recording record online sales of £ 1,164.1m (up £ 332.7m) breaking the £ 1bn mark for the first time for the half-year. Mobile sales now account for 65% of sales for the lottery operator, with Camelot noting a growth of £ 317.4m over the period with figures hitting an all-time high of £ 749m. Meanwhile, draw-based games increased by £ 300.3m to £ 2,261m.

THE 2020 TENDER The UK National Lottery was always a very valuable commercial objective in the gaming industry, as well as a challenge for operators throughout the world. The 2020 license is a very important point on the kingdom’s agenda. In fact, the list of names and companies as applicants began at the end of 2019. But also Camelot will have to compete against external factors. In December 2017, Meg Hillier, the chair of the

Richard Desmond wants UK National Lottery to “go back to the British”.

public accounts committee, questioned whether Camelot was operating within the National Lottery Act. Camelot’s accounts show that lottery sales increased by 27% (£ 1.5bn) to £ 6.9bn, between 2009- 10 and 2016-17. Over the same period,, returns for good causes increased by 2% to £ 1.5bn and Camelot’s profit attributable to its shareholders increased by 122% (£ 39m) to £ 71m.

“According to official data, since 1994 the National Lottery has become an institution within the UK, raising over £ 40 billion for good causes and paying out over £ 59 billion in prizes”. The National Audit Office (NAO) report shows that income for good causes fell to £ 1.63bn at the same time as three of the six largest Lottery distributors increased their grant commitments by a total of £ 88m.The drop in money for good causes came as Lottery sales fell by 9% to £ 6.93bn compared to the previous year. Camelot’s argument was immediate. “While we will continue to face economic uncertainty and growing competition from the gambling and lottery sectors

in general, and although there is still a great deal of work to be done, I am delighted with the fundamentals that we have established and the initiatives that we have already implemented are paying off,” Chief Executive Nigel Railton said. Neil McArthur, executive director of the United Kingdom Gaming Commission (UKGC), said: “Making sure that returns to good causes are maximized is a priority for us as a regulator. This will remain a priority as we look to the future. “ Sir Richard Branson - founder and chairman of Virgin -would enter UKGC proceedings by launching his third attempt to secure the National Lottery. Its 1994 registered trademark dates back strongly today. ‘People’s Lottery’ campaign promising to ‘return all profits to charity’. But it did not transcend at the time of decisions. The People’s Lottery bid would be declined by the Major Conservative government, who would back the formation of a ‘Camelot operating vehicle’ formed by ICL, Racal Electronics, Cadbury Schweppes and De La Rue in partnership with GTech as lead lottery systems supplier. In 2000 the story seemed different, but it had the same ending. Branson would contest the National Lottery’s second tender by re-launching the ‘People’s Lottery’ bid, this time re-energized by the support of Compaq Microsoft and Kellogg’s. However, an acrimonious bid against Camelot would be rejected by the Blair Labor government, which in its review underlined that the People’s Lottery FEBRUARY 2020

UK / REPORT

Robert Chvátal, CEO of SAZKA.

“For the 3Q reported revenue of € 393.6m (£ 335.2m / $ 433.5m), at 6.7% year-on-year increase and OPAP’s € 393.6m in revenue came on € 1.08bn worth of wagers, to 3.4% increase from 2018”. had failed to demonstrate the hardware capacity capable of running a national lottery retail network - a factor Branson deemed as foul play by Camelot backers. The concept of “National Lottery for the British” is expressed more emphatically in Former Daily Express owner Richard Desmond, whose Northern & Shell media group runs The Health Lottery, who also confirmed that he is aiming to take over the license for The National Lottery. A spokesman for Desmond said The National Lottery had ‘lost its way’ under Camelot and it should be taken ‘back into British hands’. But the tender will not only be reserved for local players. SAZKA Group Chief Executive Robert Chvátal has confirmed that the gambling conglomerate will launch an official 2020 bid competing to win the UK’s fourth National Lottery contract starting in 2023. “Next year we are preparing a tender for The National Lottery, and this is a very interesting opportunity for us, ”he said. “We want to try to be the operator of the UK’s prestigious lottery. Moreover, Britain is the cradle of betting, and it is one of the largest markets in Europe. ” 56

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“Brexit is not a problem,” said the leader of the company that grows by giant steps. Significant corporate changes in 2019 saw SAZKA split its holdings by taking full control of SAZKA’s gaming properties and investments by Czech billionaire Karel Komarek Jr’s KKCG private equity fund. Another of the important references to apply in the tender is Française des Jeux (FDJ). FDJ was privatized in 2018 after the French Assembly voted to allow French President Emmanuel Macron’s In March party to sell its 72% share in the operator. Investment bank Rothschild is one of four strategic advisors appointed by the UKGC to support the 2020 tender’s framework and bidding process, working in partnership with management consultancy Deloitte, auditor EY and law firm Hogan Lovell.

PRIVATIZATION IN FRANCE An initial public offering (IPO) refers to the process of offering shares of a private corporation to the public in a new stock issuance. That day is the most anticipated for any company that moves to the

stock market. Meanwhile, by the measure of President Emmanuel Macron to privatize the Française des Jeux, November 21, 2019 was a very important day for an entire country. FDJ was set up in 1993 as a national lottery to aid soldiers during The First World War. That patriotic sentiment moved to the more than 500,000 French who said they invest in one of the local flags. In November 2018, for the public budget it meant an income of € 2 billion (£ 1.71 billion). In the first nine months of 2019, FDJ’s latest financial report card shows the company’s net gaming sales growing 7% to just over € 1,42b. Meanwhile, the first quarter of the year was 8.1% better compared to the same period of 2018. France’s private casino operators expressed concern about the reluctance of the government to explain that FDJ’s 30k retail outlets would be allowed to add slot machines following their privatization. The government was also coy on rumors that the digital operations of FDJ will be allowed to offer online casino products someday. French-licensed online gambling providers are currently limited to sporting and racing wagers, as well as to poker tournaments and cash plays, but virtual slots and tables remain unrestricted, for now at least. Half of the French population played FDJ games at least once a year. In 2018, the French spent a record €16 billion (£13.7 billion) on FDJ, an increase of one-third over four years. But the structure of the lottery in France is not only financial, but also from regulation. As part of its recent privatization, FDJ underwent a number of tax and regulatory changes, including the discontinuation of the “counterparty fund” system, a form of insurance offered by the government which allowed FDJ to keep a portion of its gaming levies as a guarantee fund that could be used in the extremely unlikely event of a high payout. FDJ said that the reform was part of a broader process of clarifying the relationship between the government and the company following the state’s recent equity stake reduction. The contract has been drawn up by global insurance broker Marsh and provides annual coverage of up to €150m, although under French

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regulations enacted earlier this year, the maximum amount payable per event will be capped at €100m from 1 January, with a €6m excess. There is a state policy that will remain intact: support for sport and social events within the country. In 2019 FDJ have announced they will become an official partner of the Paris 2024 Olympic and Paralympic Games. From second quarter of 2020 and will aim to bring everyone together to celebrate the Olympics, with 30,000 points of sale all over France. It will hold a new licensed lottery program from 2020 to 2024, consisting of games that will be expanded as the event develops. FDJ had been the first company to actively support the Paris 2024 bid, launching a temporary instant game for the occasion.

GREECE: OPAP GROWS, BUT WITHOUT SPORTS BETTING OPAP, founded in 1958 as the country’s national lottery and listed in the Athens Exchange in 2001, is the exclusive licensed operator of all numerical lotteries (7 games). It also operates exclusively, as a controlling shareholder (67%) through a joint venture, the passive lotteries and instant (scratch) games in Greece. Since the Initial Public Offering (IPO) there was a series of secondary offerings in 2002, 2003 and 2005 when the Hellenic Republic gradually reduced its participation to the Company’s share capital. Finally, since Q4 2013 the company, through an international tender, became fully privatized, a fact that provided the momentum need-

National Lottery.

Sir Richard Branson appeared three times for the National Lottery UK tender.

ed to ensure its future development and competitiveness on an international level. Until September 2019, he also had control of sports betting. In May of 2014, the Hellenic Gaming Commission (EEEP) allowed OPAP to launch online sports betting. However, Goalbet - one of 24 operators granted a temporary license in 2011 that was later revoked - argued that OPAP had never been asked to meet the conditions necessary for a Greek online sports betting license, and their license was therefore void. The loss of the license, whether temporary or permanent, is not expected to have a major impact

on the operator’s sports betting revenue, which remains dominated by OPAP’s retail offering. For the six months to 30 June 2019, sports betting revenue was down 5.2% at € 191.9m, with Pame Stoixima’s (OPAP online sports betting brand) contribution flat year-on-year. While the company worked to meet the requirements of the new regulation, everything was going the right way. In fact, in October, Czech lottery group Sazka Group increased its stake in OPAP to almost 40% after the completion of an offer period during which it attempted to acquire all of OPAP’s outstanding shares. This was as a consequence that OPAP registered the best first quarter in the decade, with an annual growth of 5.0% in revenues to 396 million euros. In addition, net earnings increased 43.5% to EUR 57.2 million. For the 3Q reported revenue of € 393.6m (£ 335.2m / $ 433.5m), at 6.7% year-on-year increase. OPAP’s € 393.6m in revenue came on € 1.08bn worth of wagers, to 3.4% increase from 2018. After paying € 188.5m in GGR contributions and other levies and duties, OPAP was left with net gaming revenue of € 265.1m, up 7.1 %. The operator paid € 93.6m in agents ’commissions and € 16.8m, 43.9% more than in 2018, in other net gaming revenue-based commissions.

“In 2018, the French spent a record €16 billion (£13.7 billion) on Française des Jeux, an increase of onethird over four years”.

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REPORT

British movies

GAMBLING ON THE BIG SCREEN The James Bond class, a thief with feelings, a fun group of immature men in trouble, a writer who works as a croupier, a masterpiece of reality that influenced universal literature, and a romantic comedy, with a common theme.

he movies were very close to gambling from the origins. Not always as central to the script, but in many cases as a social bond. In Western cinema, cowboys sat around a table to play cards. With bets or without bets, it was a space for conversation, for discussion, to plan a certain objective and even to solve some circumstance in everyday life. There should not necessarily be a winner. Or maybe yes. Intelligence, skill, ingenuity and magic, among other characteristics of the scene. Gambling also establishes a climate within the movies. The sounds of the chips, the movement of a slot machine, the murmur of a talk, music, a look between two or more people, the atmosphere of fun and tension for a moment are part of those elements that keep us attentive to the screen. It also means a style of dress. It can be with supreme elegance, in casual look or with very light clothes. The cinema marks the breadth in the hobby of betting. 58

There are also thieves, people in trouble or those who suffer from addiction. For them there is also a teaching, either in the social or justice framework. Love, romance, work, vacations are also included in that relationship between movies and bets. American culture adopted gambling more frequently. But there are also British films that included gaming as part of the argument to entertain. Here are some movies that are already part of the popular comment.

CASINO ROYALE (2006) It doesn’t matter the year or the main act. There is a phrase in the film industry that is universal. “My name is Bond, James Bond.” The most famous secret agent in the world is and will be part of us forever. The link with gambling is from “Dr. No” (1962) to the present. The reference of Casino Royale is perhaps the most significant by the name of the movie. Casino Royale is the twenty-first film in the James Bond film series, based on the homonymous novel by Ian Fleming, directed by New Zealand’s Martin Campbell and released in 2006. It is the first film in the franchise that Daniel Craig has in the leading role of agent 007, as well as the third adaptation of Casino Royale (the first version was released in the year 1954, and the

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second in 1967). The plot addresses the beginnings of James Bond as a secret spy, just after obtaining his license to kill. After preventing a terrorist attack at Miami International Airport, Bond falls in love with Vesper Lynd, an agent of Her Majesty’s Treasury, assigned to provide him with the monetary funds necessary to thwart a high-stakes poker tournament, organized by Le Chiffre. The story continues in Quantum of Solace. Cumulative Worldwide Gross: $609,447,995.

THE GOOD THIEF (2002) The Good Thief is a 2002 BritishFrench-Irish crime thriller film starring Nick Nolte, Emir Kusturica and Nutsa Kukhianidze, and directed by Neil Jordan. It is a remake of the French film Bob le flambeur (1955) by Jean-Pierre Melville. The film, shot in both Monaco and Nice, France, follows a heroin-addicted retired thief through the setup and completion of one last job. Bob Montagnet (Nick Nolte) is, in addition to a gambler, an American thief who has ended up ruined in the French Riviera. Deep down he is a sentimental, as evidenced by his selfless effort to remove a young Russian from bad company. But when Bob hits the bottom, after losing everything in the races, they propose a final and spectacular blow: it is about stealing the vault of the Monte Carlo Casino, which contains an invaluable art collection.

LOCK, STOCK AND TWO SMOKING BARRELS (1998) Set in England, an overly-confident card player enlists three of his best friends to aid him in pulling off a heist in order to pay off a debt that he owes to a crime boss after he loses £500,000 in a fixed game of three-card bag. Guy Ritchie made his feature directorial debut with this crime-caper comedy-drama set in London’s East End and heavy on the Cockney dialogue (with one scene in subtitled Cockney rhyming slang). A big-bucks scheme goes awry: Cardsharp Eddy (Nick Moran) and pals Bacon (Jason Statham), Tom (Jason Flemyng), and Soap (Dexter Fletcher) scuffle to pile up enough money to put Eddy at the card table opposite gangland porn lord Hatchet Harry (P.H. Moriarty). Unfortunately, the whole plan backfires, leaving Eddy

owing Harry a huge sum, payable within the week. In truth, Harry hopes to acquire the bar run by his rival, J.D. (Sting), who is Eddy’s father. To raise the cash, Eddy sets out to steal from a marijuana business run by Winston (Steven Mackintosh), but the inevitable gunplay doesn’t make for an easy heist. World premiere at the 1998 Edinburgh Film Festival (Focus on British Cinema). Based on a $1.35 million budget, the film had a box office gross of over $28 million, making it a commercial success.

Based on a $1.35 million budget, Lock, Stock and Two Smoking Barrels had a box office gross of over $28 million. CROUPIER (1998) It is a love story, but unconventional. It is a story about labor relations, although where the contact is not necessarily with words. It is a story of different social and economic levels, however with similar survival goals no matter how and where life is.If you love gambling but don’t have the skill for it, you could get a job as a croupier. At the very least you would get to see others win - and live vicariously through them. This was the life of Jack Manfred, played by Clive Owen, up until he realized that he was witnessing golden material that he could use for his book. Inspiration comes from everywhere.

THE GAMBLER (1997) It is not a British movie. Nor is it based on an author who was born on the islands. But the influence of the writer was so important in the continent (and in the world) that his legacy is very deep in the betting culture whatever the country. The Gambler is a 1997 drama film directed by Károly Makk and starring Michael Gambon, Jodhi May and Polly Walker. It is set around the writing of the novel The Gambler by Fyodor Dostoyevsky. The film was notable for its casting of Luise Rainer. The Oscar-winning actress had not made a film in fifty-four years prior to her appearance in this one.

The Gambler is a short novel by Fyodor Dostoyevsky about a young tutor in the employment of a formerly wealthy Russian general. The novella reflects Dostoyevsky’s own addiction to roulette, which was in more ways than one the inspiration for the book: Dostoyevsky completed the novella under a strict deadline to pay off gambling debts. The Gambler is set in the casino of the fictional German spa town of Roulettenburg and follows the misfortunes of the young tutor Alexei Ivanovich. As he succumbs to the temptations of the roulette table, he finds himself engaged in a battle of wills with Polina, the woman he unrequitedly loves. With an unforgettable cast of fellow gamblers and figures from European high society, this darkly comic novel of greed and self-destruction reveals Dostoevsky at his satirical and psychological best. Fyodor Mikhailovich Dostoyevsky (1821 – 1881) was a Russian novelist, short story writer, essayist and philosopher. Dostoyevsky’s literary works explore human psychology in the context of the troubled political, social, and spiritual atmosphere of 19th-century Russia. Many literary critics rate him as one of the greatest and most prominent psychologists in world literature.

KALEIDOSCOPE (1966) Romantic comedy which has Barney Lincoln and Angel McGinnis as a pair of amorous adventurers in the gambling places of London and the Riviera. Barney Lincoln is a rambling gambling man who scores sensational wins at poker and chemin de fer because he has succeeded in marking the original plates for the backs of all the playing cards manufactured in a plant in Geneva and used in all the gambling joints in Europe. In his gambling depredation, Barney is spotted by Angel McGinnis, the daughter of a Scotland Yard Inspector ‘Manny’ McGinnis on the lookout for a man to do a job. The inspector enlists Barney’s help in playing poker with a shady London character whom Scotland Yard wants to force to financial ruin. The film had its World Premiere on 8 September 1966 at the Warner Theatre in the West End of London. FEBRUARY 2020

UK / REPORT

Sports betting

INTEGRITY AND DATA AT THE CENTER OF THE SCENE

In January of this year, the relationship between the British FA Cup and IMG opened a discussion on the monetization of sports with sports betting companies, which is a very latent issue in the United States, while the debate over the data marks the agenda on both sides of the Atlantic. also own Stoke City Football Club, has the rights as part of the deal, along with Betfair, William Hill, Coral, Ladbrokes, Unibet and Paddy Power. The FA does not sell the rights to these companies directly; it has sold global betting rights on the FA Cup to the marketing company IMG for a reported $4m (ÂŁ3.1m) a year and IMG sells the packages on. In addition to the seven companies that have bought the rights to show the matches in the UK, IMG has sold similar streaming rights to other betting sites internationally.

Seven bookmakers have the rights to show FA Cup ties on their websites and apps.

he father of the sports betting market is the United Kingdom. In fact, while a monetization process is being experienced in the United States through marketing, rights and advertising, in the islands that area is being reorganized. Everything revolves around the link of credibility and crystallinity that must exist between the companies that support the product, bets and consumers. In each case, all the elements are necessary for the growth of a business unit. However, in convergence, everyone should work well in addition.

THE EXAMPLE OF THE FA CUP The FA Cup is a sacred tournament in England. Established in 1871, itâ&#x20AC;&#x2122;s the 60

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oldest existing soccer competition in the world, and is open to the top ten tiers of English and Welsh soccer. The Third Round Weekend is particularly revered. This is the stage at which Premier League teams enter the competition, which can occasionally throw up matches between amateur clubs dwelling in the lowest echelons and some of the most elite teams in the world. In 2017, the FA had agreed to a sixyear deal with IMG which allowed the broadcasting rights to be sold to bookmakers from the start of the 2018/19 season. The agreement is not due to finish until the end of the 2023/24 campaign. Bet365, the giant gambling company owned by the Coates family, who

Bet365 has the rights as part of the agreement between FA and IMG, along with Betfair, William Hill, Coral, Ladbrokes, Unibet and Paddy Power. The process has a contradiction. Back in July 2017, the FA confirmed that it would cut all ties with betting companies after ending its commercial deal with Ladbrokes. The IMG intervention made the sponsorship again have a link with sports betting companies. The sporting body has since confirmed that it is unable to terminate the agreement which permits coverage on the Bet365 site due to the long-term nature of the deal. The participation of a sports betting company in advertising is not incorrect.

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The analysis focuses on how bookmakers exploit rights and what is care for consumers. The report found that coverage of 23 of the 32 FA Cup third-round ties that took place the first weekend of January were accessible via the bet365 website on the conditions that customers staked a bet or signed up for a new account with a £ 5 deposit. An FA spokesperson said: “The seriousness of sports betting companies involved with FA is proven for so many years in the market. Either way, we will review this element of the media rights sales process ahead of tendering rights to the new cycle from the 2024/25 season onwards. Leagues and clubs continue to govern their own relationships with gambling companies. It’s about analyzing, drawing conclusions and improving. “ The state response was disapproval. “We’re very angry as a government with this arrangement, especially on a weekend when the FA very worthily had the Heads Up mental health campaign,” said sports minister Nigel Adams - speaking on behalf of the Secretary of State for Digital, Media, Culture and Sport “We have asked the FA to look at this current deal, see what opportunities there are to rescind this particular element of the deal, and I will be meeting with the FA. It’s absolutely right that the FA and all sporting bodies who have links with sponsors across all sectors need to be very mindful of impact that such deals have on vulnerable people. “

THE STRENGTH OF THE DATA In the United States, since mid-2019 the debate on intellectual property and the rights of franchises and associations in sports betting has deepened. The story began in 2018, when the US Supreme Court lifted the ban on the organization of sports betting. And professional sports leagues (NBA and MLB) spoke in favor of the introduction of the integrity fee - 1% of the total bet amount placed within the specified leagues. Since then there are two very clear positions that to date cannot reach an agreement. On the one hand, Authors of the initiative stated that they had the intellectual property right for the sports

Data is an axis for sports betting.

statistics. Consequently, they wanted to receive the license fee for the use of statistics by betting houses. At the other extreme, experts state that professional leagues lack fundamental intellectual property rights for statistical data. They have copyrights to their content, logos, names, etc. But bookmakers do not use such intellectual property subject matter for the organization of sports betting. To conduct their activities, they use statistics only, which is based on game results. And there one of the most important points whatever the scenario: the data. Nothing is more valuable than information, whether for the consumer or for the growth of operators. The greater the number of tools, the greater the precision to make decisions and, therefore, the better the quality of the service. For anyone who wants to understand how the tripartite relationship between major sports leagues, sports betting data providers and their trading partners will develop, Europe offers an interesting contrast in the comparison. For the number of years spent, the United States and Europe are in different instances when making decisions about

the regulation of certain aspects. In the US, the provision of official league data has emerged as one of the most sensitive topics in the debates surrounding the further regulation of sports betting. In Europe there was and will be many debates, but with the data, a key difference with the US is the backdrop of the EU database rights. In an ecosystem where IP rights only apply to a database that has been created and crucially not the data itself, the database right provides the framework within which all the data providers operate. The EU database right has provided the platform for the evolution in Europe of in-play betting with the availability of the data at relatively low price point fostering innovation at a product level. The database right applies whether the data is collected under the auspices of an official league data deal or via open source means. There is also the possibility of giving consumers both ways of information. That quality and quantity allows the most important suppliers to make a difference with the competitors.

In Europe the database right applies whether the data is collected under the auspices of an official league data deal or via open source means.

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REPORT

Responsible gambling

UK: BECAUSE BETTING REMAINS AN ENTERTAINMENT

The protection of Gamstop and google searches, the contribution of Betting and Gaming Council (BGC), the changes of the UK Gambling Commission (UKGC) for this year’s regulation, and the analysis of Young People & Gambling, as central points in the present for the care of the consumer.

s described by the third of Newton’s laws of motion of classical mechanics, all forces occur in pairs such that if one object exerts a force on another object, then the second object exerts an equal and opposite reaction force on the first.The third law is also more generally stated as: “To every action there is always opposed an equal reaction: or the mutual actions of two bodies upon each other are always equal, and directed to contrary parts.”The attribution of which of the two forces is the action and which is the reaction is arbitrary. Either of the two can be considered the action, while

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the other is its associated reaction. It also happens in the betting industry. Sir Isaac Newton was born in Woolsthorpe, Lincolnshire. His work was of enormous value to all mankind, even to form a thought in matters he had never imagined. In fact, to explain many of the tools of responsible betting, one of his most important studies can be cited. As described by the third of Newton’s laws of motion of classical mechanics, all forces occur in pairs such that if one object exerts a force on another object, then the second object exerts an equal and opposite reaction force on the first. The

third law is also more generally stated as: “To every action there is always opposed an equal reaction: or the mutual actions of two bodies upon each other are always equal, and directed to contrary parts.”The attribution of which of the two forces is the action and which is the reaction is arbitrary. Either of the two can be considered the action, while the other is its associated reaction.”

GAMSTOP AND GOOGLE SERCHES The offer of online casinos and betting sites in general is endless. The industry

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developed even to compete directly with land casinos. You need a click to download software, enter personal data, use the credit card to have funds, and welcome to the world of betting from a personal computer or from your mobile phone. From that point the need was also born through digital tools to take care of the consumer of the risks of gambling in excess. Launched in early 2018, GamStop is the UK’s national self-exclusion program. All licensed online gambling sites in the country are obliged to screen users and refuse service to anyone on the list, which contained some 50,000 names by the beginning of 2019. GamStop was originally the creation of a group of UK operators known as the Remote Gambling Association (RGA). In September 2019, the RGA transferred ownership to GamStop’s board of directors so that it could operate independently and without the potential conflict of interest. In January it was detected that if a user that a Google search for “gamstop uk” returned paid advertisements for three online gambling affiliates before any results for the service itself. All three linked to pages specifically promoting off-

Carolyn Harris, a Labor MP and chair of a cross-party group on gambling-related harm .

page. Searches for a number of other related terms threw up similar results. The Betting and Gaming Council (BGC) was quick to respond: “UK licensed operators do not advertise using search terms linked to words seeking help. Any non-UK licensed or affiliate using terms such as GamStop, must be stopped. We will raise this with re-

About Gamstop, all licensed online gambling sites in the country are obliged to screen users and refuse service to anyone on the list, which contained some 50,000 names by the beginning of 2019. shore sites not enrolled with GamStop. The top result from a Google search for “GamStop UK” was an advert stating: “Not on Gamstop Popular sites - Get 300 per cent Bonus.” All of the top four links, which advertisers pay Google for, pointed to lists of casinos allowing customers to work around the self-exclusion service. Clicking through leads to lists of dozens of offers presenting new customers with hundreds free spins on online slot machines, roulette and other potentially addictive games at virtual casinos based in Cyprus and the Caribbean island of Curacao, among other locations. The link to the actual GamStop website was relegated to Google’s free search results which start from position five on the

levant bodies and push search firms to strengthen their key word prohibitions.” The response of GamStop was also very emphatic. “When people search for information about self-excluding from online gambling, they should only see results relating to Gamstop and organizations providing support for problem gambling,” Fiona Palmer (chief executive) said. “Consequently, we are working with Google and other search engines to ensure that when people search for information about self-excluding from online gambling our website is prominently displayed and these websites are not included within the search results,” she added. Politics also took sides in this situation. “I don’t necessarily blame Google,”

Carolyn Harris, a Labor MP and chair of a cross-party group on gambling-related harm said. “In a way they are victims of the ingenuity of companies who are capable of bypassing any measures that are put in place. I have serious reservations about the entire self-exclusion system and the gambling industry’s willingness to tackle the problem. ” A Google spokesperson said: “We support responsible gambling advertising and it’s important to us that people see useful and relevant ads in this area. As such, we have strict policies around gambling ads, which we enforce rigorously. We have suspended the accounts in question.” The company says it uses a combination of humans and algorithms to vet adverts and enforce its rules. Gambling adverts have been inappropriately placed on Google searches before. In October, the Advertising Standards Authority (ASA) banned an ad for a casino app that targeted customers who googled “How to unsubscribe from all gambling”.

BGC The BGC is an even more recent initiative than GamStop, announced in July 2019, and began operations in November. It is essentially a unified council for all gambling and sports betting operators in the UK. It replaces what used to be three separate entities: the RGA for online gambling, plus the Association of British BookFEBRUARY 2020

REPORT

makers and the National Casino Forum, which focused on their respective verticals in the retail market. The BGC will represents approximately 90 percent of the UK betting and gaming industry (excluding lotteries) – an industry that employs over 100,000 people and contributes more than £14 billion to the UK economy. The council expressed its foundations at the end of 2019 with a dynamic and attractive project. Over the Christmas period, the Betting and Gaming Council (BGC) conducted a multimedia campaign to encourage individuals to set limits before betting. Targeted at people aged between 1834, the campaign formed part of the Safer Gambling Commitments, and will promote the tools to facilitate customers staying in control of their betting. Just as we all set limits in many aspects of daily lives, that the same should apply to gambling. The ‘limits are good’ message is based on research commissioned by the Senet Group which demonstrated the direct link between enjoyable gambling and individuals ’ability to stay in control. Most gamblers establish self-determined limits for their play. The research suggests that negative sentiment towards gambling is almost exclusively associated with the sense of lost control. It is under these circumstances that customers bet and game in a harmful way. With this research in mind, the path to progress seems clear. The betting and

gaming sector must endorse methods for individuals to control their gambling behavior. That means actively provide tools that make it easier for customers to limit both their time and money spent gambling, and to encourage them to do so.

The UK Gambling Commission is set to recommend a blanket ban on the use of credit cards for gambling or, at the very least, heavy restrictions, including limiting customers to the use of one credit card only. NO MORE CREDIT CARD? There are no major obstacles to betting from home: it reaches with a credit card. News that Britain’s gambling watchdog was planning to curb credit card gambling first arising in the summer of 2019. But it wasn’t such an easy decision to make. An analysis had to be carried out at the height of the circumstances for such a complex business unit. The UK Gambling Commission launched a twelve-week consultation period in early August, inviting the public and other industry stakeholders to voice their opinion on whether the use of credit cards for gambling purposes should be prohibited or at least limited. The gambling regulator said at the start of the consultation period that after its end

Betting & Gaming Council will represents approximately 90% of the UK industry.

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in early November, it would “take the most appropriate course of action in view of any evidence obtained by this consultation, alongside data already submitted.” The decision covers a large part of the market offer. Customers of UK-licensed

sports betting and casino gaming websites as well as retail betting shops are currently allowed to make deposits using their credit cards. Experts have cited the use of credit cards as one of the major factors driving the rise of problem gambling that has been recorded in recent years. According to industry sources, the UK Gambling Commission is set to recommend a blanket ban on the use of credit cards for gambling or, at the very least, heavy restrictions, including limiting customers to the use of one credit card only. Credit card gambling was also mentioned in relation to a planned overhaul of UK’s Gambling Act that was drawn up and introduced under Tony Blair in the mid2000s. The use of credit cards for gambling purposes was one of the main issues raised by some MPs, including Labor Deputy Leader Tom Watson, who detailed the case of a woman who racked up at £ 100,000 gambling debt in just two days by wagering online with nine credit cards Labor MP Carolyn Harris, who chairs an all-party parliamentary group on gambling-related harm, has been adamantly calling for a blanket ban on the use of credit cards for gambling. She has also been lobbying for banks to roll out measures preventing customers from using their overdrafts to gamble. Instrumentation also requires responsibility from the financial sector. Some banks have already introduced tools aimed at helping customers who might have a gambling problem. Halifax and HSBC have both recently announced that their customers can self-exclude their credit cards from

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REPORT Comes from page 64

being used to gamble. HSBC card holders can only start re-using their credit cards for gambling purposes after a 24hour cooling-off period, while Halifax customers can only resume making deposits with their cards after 48 hours.

MORE CHANGES TO COME UK Gambling Commission is programming other modifications for this year’s regulation. Some of the newest regulations cover gambling advertising, as well as age verification issues as some of the matters with a paramount priority that have been set by the watchdog. Both of them are expected to make the gambling industry’s public perception better and make sure local customers are more responsible when it comes to gambling. There is also a line for sponsorship, just a very lively issue for some time now. An advertising rules update has been among the most important changes that have been made in the gambling sector of the UK, with the changes being preceded by plenty of criticism for the regulatory failure to ensure better protection for UK residents. Several months ago, the largest players in the country’s gambling sector self-imposed an advertisement ban after making a decision to suspend gambling advertising broadcast during live sporting events aired on television. As for self-exclusion, the debate is not only subject to sites such as Gamstop or similar consumer care associations. It is analyzed that the coverage has a broader vision. That was one of the most notable changes made in the regulation, or should we say in the self-regulation, of the advertising during televised live sports events. A voluntary ban on gambling adverts at the time when such events are aired on TV was imposed by the Industry Group for Responsible Gambling in August 2019. Under the move, no gambling adverts are not allowed to be displayed during live sporting events before 9: 00 P.M.

YOUNG PEOPLE AND GAMBLING, DOWN The Gambling Commission has published the 2019 Young People & Gambling survey which looks at gambling 66

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UK Gambling Commission is ready for key changes in 2020.

trends of 11 - 16-year-olds in Great Britain. On behalf of The Gambling Commission, Ipsos MORI carried out a survey among 2,943 pupils aged 11- 16 across curriculum years 7-11 (S1 – S5 in Scotland) using the Ipsos MORI Young People Omnibus. A total of 606 schools were selected, at random, from a sample frame of all Academies and Maintained secondary schools across Great Britain. 124 schools agreed to take part, giving a school response rate of 21%. Within each of these schools, one curriculum year group was selected, at random, and, within this year group, one class (two in four schools) was randomly selected and the pupils within this class asked to take part in an online self-completion survey. Results to the current 2019 survey are compared with previous waves for some questions. The selection of the sample and weighting were carried out in the same manner as 2018. In 2018, 2,865 11-16 year olds took part in the research. Whilst the 2019 survey was carried out online, the 2018 survey was a mix of online and paper-based interviews and all previous waves were paper-based. The survey looks at those forms of gambling and gambling style games that young people legally* take part in along with gambling on age restricted products. The findings show that 11% of 11-16year olds that took part in the survey say they have spent their own money on gam-

bling in the past seven days, compared with 14% in 2018. The long-term trend shows a decline in participation since the questions were first asked in 2011. The most common type of gambling activity that young people are taking part in is private bets for money (e.g. with friends) (5%) with a further 3% playing cards with friends for money. “This report demonstrates that children and young people’s interaction with gambling or gambling behaviours comes from three sources – gambling on age restricted products and gambling style games. Any child or young person that experiences harm from these areas is a concern to us and we are absolutely committed to doing everything we can to protect them from gambling harms, said Tim Miller, Executive Director, said. “Most of the gambling covered by this report takes place in ways which the law permits, but we must keep working to prevent children and young people from having access to age restricted products. Where operators have failed to protect children and young people we have and will continue to take firm action. This year alone, we have tightened rules and requirements around age verification to prevent children and young people from accessing age restricted products, put free-to-play games behind paywalls, and clamped down on irresponsible products.” FEBRUARY 2020