AGBriefings September 2020 Edition by Asia Gaming Brief

Jurisdiction Updates September 2020 Edition

In focus pg.14

Sports betting

Getting the regulatory ball rolling

philippines pg.28 Projects push forward

korea pg.10 Gaining local support? Japan pg.12

Abeâ&#x20AC;&#x2122;s exit impact

Macau pg.6

Recovery lags

SUPPLIER SPECIAL REPORT pg.36

MESSAGE 3

Moving off the sidelines

ost of the brick and mortar industry around

gaming companies. The official memo to the President’s

Asia is still in shutdown, or at best operating at

office follows recent departures of several online gaming

marginal levels, but major sporting events are

firms from the Philippines due to the rising cost of doing

slowly ramping up across the globe.

business in the country.

We dedicate this September edition of Asia Gaming Brief

Crossing the Pacific, the new PM of Japan, replacing Shinzo

Jurisdiction Updates to that sports betting world.

Abe, has promised he will push ahead with the development

The question to keep in mind: Is it time to rethink the

of IRs in the country, saying they are indispensable for the

industry or is it business as usual? In the midst of the

country’s tourism development.

COVID-19 pandemic, which has pretty much decimated

Across the straits, the Covid-19 pandemic may be triggering

land-based casino and betting shops worldwide, is there

South Korea to rethink its foreigner-only casino policy, as the

light at the end of the very long tunnel?

country’s casinos struggle with a lack of tourism revenue.

We look at how punters have been flooding the sports

Down under, analysts feel that Australia’s gaming venues

betting zone. Kung Volleyball, ping pong and Tajikistan

may have to wait as long as two years for gaming revenue,

football leagues were among the exotic sports that saw

demand, and turnover to return to “normal levels.”

wagering action during the pandemic shutdowns, though

In turn, SkyCity continues to show its mettle as it strives

now regular sports operators are noting a big swing back to

through adversities, though the company has also registered

old favourites.

strong growth in its online business launched just last year.

Deep diving into India, while sports betting remains illegal,

The final section of this September edition is dedicated to the

betting on online fantasy sports (OFS) has been the biggest

SBC Barcelona Digital Summit for which Asia Gaming Brief

growth area of the country’s online skill-based gaming

was selected to be the Premier Media Partner.

industry - this while awaiting IPL’s return...

The landmark event for the sports betting industry

In these pages you’ll find the most relevant updates across

aggregated more than 10,000 delegates from around the

the 22 jurisdictions across Asia.

world over the four-day digital conference and exhibition.

Starting off with Macau, travel restrictions are gradually

Over the next few pages, you’ll read from some of SBC

being lifted from China, although analysts are not expecting

Barcelona Digital Summit’s key digital exhibitors and their

a v-shaped recovery and warn it may be some time before

plans in the sports betting industry over the next year.

visitation can get back to normal levels. Until then the focus

Happy readings, Stay safe, stay healthy.

Rosalind Wade

Luis Pereira

remains on cost cuts and recovery timing. Meanwhile, operators in the Philippines say they are

On behalf of Asia Gaming Brief

moving ahead with their capital expansion projects,

Rosalind Wade & Luis Pereira

expressing optimism in the future of the market. Case in

Publishers

point, PH Resorts, which is developing the Emerald Bay Resort on Mactan island, says the property is scheduled to

Connect with us:

open in late 2021. On the online front, PAGCOR has taken the unusual step

@agbrief

of claiming that - Malaysia - a strictly Muslim country

Asia Gaming Brief

where gaming is highly restricted, is trying to woo online

www.agbrief.com

september 2020 EDITION Series II • Issue XIX

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Asia Gaming Briefings | September 2020

CONTENTS 4

GREATER CHINA

NORTH ASIA

MACAU

SOUTH EAST ASIA

south korea

malaysia

JAPAN

PHIlippines

AUSTRALASIA australia

new zealand

special focus

SUPPLIER SPECIAL REPORT

INDUSTRY OPINION LAST WORD

Asia Gaming Briefings | September 2020

50 54

Asia Gaming Briefings | September 2020

GREATER CHINA

MACAU

Q2 focus on cost cuts and recovery timing Travel restrictions are gradually being lifted between Macau and China, although analysts are not expecting a v-shaped recovery and warn it may be some time before visitation can get back to normal levels. Asia Gaming Briefings | September 2020

GREATER CHINA

he Q2 results recently reported by of this year. Analysts are sceptical and say all the operators made for grim it’s not likely to open until the first quarter reading, but didn’t contain any of next year. major surprises. Investor attention Galaxy Entertainment was an outperformer, was more focused on how the companies posting a slight beat to analysts’ expectations, had trimmed costs to reduce cash burn coming in at 7 percent above the consensus and on management views on the timeline Bloomberg estimate for adjusted EBITDA. for recovery. The company reduced its cash burn Executives from all operators expressed from $3.4 million to $2.5 million in the confidence in the long-term prospects for second quarter and is pushing on with its the Macau market, though were mixed on development plans for Galaxy Phase 3. just when that might occur. “We believe Galaxy is in the best Although all six reported a loss for the liquidity position to weather the pandemic quarter, Bernstein notes that they are likely storm,” Bernstein says. “With the tourism to break even on an EBITDA level by mid- visa resumption in Aug/Sep, we expect to Autumn, once individual visit and group see faster recovery for Galaxy (than some visas have been fully reinstated. Those others), which has a higher mix of premium+ properties focused on the VIP and premium customer segments.” sectors will significantly Melco Resorts and outperform in the short Entertainment’s results term given the ramp up came in line with expectato high volumes of mass tions, though management We believe visitors is likely to take perhaps hit a brighter note some time, it says. than some others. The Galaxy is in the The firm says the company said it doesn’t best liquidity operators should be able to expect a v-shaped recovery, break even once revenue but is confident about position to returns to about 35 to the long-term prospects weather the 40 percent of Q4, 2019 in Macau. revenue. Wy n n M a c a u ’s pandemic In August, gross gammanagement was also storm, bling revenue dropped positive about prospects by 94.5 percent, its fifth in the territory, though its straight month of a more results came in slightly than 90 percent decline. below expectations due China began issuing visas for Zhuhai to negative VIP hold and low mass hold. residents on August 12 and since then, The company confirmed it has postponed visitation has improved to about 7,000 a all major project capital expenditures for day from a few hundred visitors in June. the remainder of the fiscal year 2020 in From August 26, IVS visas will be available light of the COVID-19 pandemic and its across Guangdong Province and from Sept. risk to employees. 23, the whole of China. The company has been in the design phase In terms of Q2 results, perhaps one of of the new Crystal Pavilion, located on a 7-acre the most noteworthy elements was the big parcel of land adjacent to Wynn Palace. jump in market share for former monopoly Sands China also reported lower-thanSJM Holdings. The company had been expected results due to weak hold, but losing share for years in favour of the newer again stressed its belief in the long-term resorts on Cotai, though had 30.3 percent fundamentals of the Macau market. of the market in the period, up from just In its operational update, it noted that 13.3 percent in the prior quarter due to its construction of the Four Season Hotel Tower position on the Peninsula and exposure Suite is complete, and work is progressing to the local mass market. Analysts don’t to transform its Sands Cotai Central resort expect this competitive advantage to last into a London-themed property. The interior once normality returns. work is expected to be finished in Q1 2021, The company has said it’s not optimistic while construction of the Londoner Hotel about a near term recovery, but has said is also almost complete. it still plans to push on with opening its The story was similar at MGM China, Lisboa Palace property on Cotai by the end whose results were also in line with consensus.

GROSS GAMING REVENUE Q1

76.15b

(units in MOP)

73.35b

30.4b 3.2b

2019

GGR 2019 MOP292.4b

2020

-3.4% (Source: DICJ)

GGR 2020E

-71% (Source: Bernstein)

“

”

MICE business plummets on Covid-19 The number of Meetings, Incentives, Conferences and Exhibition Events (MICE) held in Q2 in Macau dropped by 89.4 percent to just 38 due to Covid-19 cancellations. Information from the Statistics and Census Service showed the number of participants dropped by 93.9 percent to 22,000. Cancellations in the quarter included the annual G2E Asia industry get together to have been held at Sands China’s The Venetian in May. The average duration of meetings and conferences was 0.7 of a day, down by 0.7 day a year earlier, with the total floor area down 93.4 percent. There were just two exhibitions in the quarter, both from non-government organizations. Receipts from the exhibitions totalled MOP1.69 million, with expenditure of MOP1.89 outstripping revenue. As a result the receipts were MOP0.36 million in the red. All of the 49 exhibitors that participated in the exhibitions in the second quarter were local exhibitors.

Asia Gaming Briefings | September 2020

GREATER CHINA 8

Sjm holdings SJM Holdings (880:HK) has 22 casinos in Macau and is still targeting an opening by the end of this year for its Lisboa Palace resort once all the inspections have been completed. In June, the company announced Frank McFadden had been appointed Chief Operating Officer for Gaming and Hospitality, replacing the recently-resigned Ng Chi Sing. According to an internal memo signed by SJM Chair Daisy Ho, McFadden will be mainly responsible for the casinos in Grand Lisboa, Hotel Lisboa, Ponte 16, and Jai Alai, plus the group’s hospitality services, gaming analytics, and property planning and enhancement. McFadden has been with SJM since 2006, most recently serving as president for International Business Development. SJM’s 2Q 2020 EBITDA was 5 percent below the Bloomberg consensus, coming in with a loss of HK$784 million. Overall 2Q GGR was HK$0.95bn, down 91 percent year on year.

Galaxy Entertainment Group Galaxy Entertainment Group (27.HK) has three main properties and runs three City Club casinos inside hotels. The company is currently working on Phase 3 of Galaxy Macau, which is to feature 1,500 hotel rooms, some casino space, a large-scale arena with 16,000 seats, and 400,000 square feet (37,161 sq metres) of MICE space. The launch is scheduled for the first half of next year. Q2 revenue fell 91 percent to HK$1.15 billion ($148.3 million), while it swung to a loss on the adjusted EBITDA level of $1.37 billion compared with a $4.33 billion profit a year earlier. Hotel occupancy across the group’s five hotels was just four percent.

Melco resorts & entertainment Melco Resorts & Entertainment (6883. HK) has three casinos and the Mocha Clubs. The company operates the City of Dreams and Studio City in Macau and the City of Dreams Manila. It is also developing a resort in Cyprus and maintains a strong focus on Japan. Melco recently boosted its holding in the

Asia Gaming Briefings | September 2020

company that owns the Studio City Resort following a share transaction providing $500 million for the property to complete the next phase of its expansion plans. Melco’s indirectly held MCO Cotai unit now owns 54.7 percent of Studio City International Holdings, up from 54.1 percent previously. MCO bought shares worth $280.8 million in the company at a price of $3.89 a share.

Wynn macau Wynn Macau (1128:HK) operates two resorts, with its $4 billion Wynn Palace opening in 2016. The company’s original property is on the Macau Peninsula. The Wynn Palace has 1,700 hotel rooms and 90 percent of the resort is non-gaming. In November, the company opened elements of its new Lakeside Casino at Wynn Macau. Wynn Macau operating revenues came in at US$11.9 million, a 97.8 percent decrease. The firm’s statement noted that its available cash as of June 30, 2020 totaled US$3.8 billion. CEO Matt Maddox noted: “In Macau,

the authorities have begun to gradually and thoughtfully ease some visitation restrictions, and we are confident the market will benefit from the return of the Chinese consumer as we move through the back half of 2020.” The group’s focus on the premium segment is likely to help fuel its recovery.

Sands China Sands China (1928:HK) has five properties in Macau. The company has 12,000 hotel rooms and suites, making up for 48 percent of hotel rooms run by casino operators in Macau. In a vote of confidence in Macau, the company recently pushed ahead with the three-day Sands Shopping Carnival from Friday to Sunday, attracting around 500 businesses and thousands of members of the public. The carnival is known as the largest shopping event of its kind in Macau, held at the Sands Cotai Expo. It provides a platform for local SMEs and Sands retailers to connect with members of the public, and is in line with the government’s “Consume for the Economy” Initiative.

GREATER CHINA 9

For Q2, Sands China posted a net loss of US$549 million. Revenues for the quarter came in at only US$40 million, which was a 98.1 percent drop from the same quarter in 2019.

MGM china MGM China (2282:HK) is operating two casinos, with its MGM Cotai IR opening in February last year. The HK$27 billion IR features 1,400 hotel rooms and suites, meeting space, high end spa, retail offerings and food and beverage outlets and its ramp up has helped the company gain market share in the latter half of 2019. MGM China saw its net revenues fall 95 percent year-on-year to only US$33 million. The company gave an update on its liquidity position and has enough cash to cover a zero revenue environment in Macau for the next 22 months. Like Melco and Galaxy, it’s still committed to pursuing a license in Japan, though on a recent conference call management suggested that would not be at any cost.

Sega Sammy debuts Volcano Link Sega Sammy Creation has announced that its new Volcano Link series of slot machines have been installed for the first time on Macau gaming floors. The Volcano Link series launches with two titles, Pride of Lion and Lucky Dolphin. Sega Sammy Creation Managing Director and Head of the Asia Sales Masahiro Kurosaki commented, “Sega Sammy Creation is very happy to introduce The Volcano Link series as the newest addition to our ever-expanding product library in Macau. These new games represent our commitment to providing players and operators with games that bring a new level of excitement. As we continue to grow our floor presence in Macau, it is important that we continue to innovate and provide the industry with new features and game themes.”

Asia Gaming Briefings | September 2020

NORTH ASIA

south korea

Will Covid-19 trigger local gaming rethink? The Covid-19 pandemic may be a trigger for South Korea to rethink its foreigner-only casino policy, as the countryâ&#x20AC;&#x2122;s casinos struggle with a lack of tourism revenue.

Asia Gaming Briefings | September 2020

NORTH ASIA

hat was the view shared by two experts on a recent Asia Gaming Brief webinar session, which studied investment opportunities in the Korean gaming industry. “This Covid is giving us a hard time and because of the situation I think maybe it’s time to rethink about South Korea’s foreign-only casino model,” said Nicholas Kim, investment director at the Incheon Free Economic Zone, which is home to Korea’s first IR. However, Kim conceded that the issue is highly complicated and the government will first need to put in place detailed regulation to govern the industry, so any potential investors will need patience. “I think it will definitely come. It’s a matter of time,” he said. “Every industry in our country is growing up very rapidly. It’s a natural course of development, but I don’t see it in the near future.” Kim stressed that he was offering his personal opinions on the issue and not speaking on behalf of the government during the session, which focused on a wide range of topics in Korea. Jeff Heo, director of strategic planning of Gaming Korea, also pointed to the difficulties being experienced by the casinos on Jeju island, suggesting that the government should think about allowing Korean tourists to enter, with

the introduction of restrictions such as an entry fee, or limited monthly entrance. There is currently only one property that allows locals to gamble — Kangwon Land — in a remote corner of the country. It was permitted under a special act to help to create jobs and rejuvenate the economy in a former mining community and now makes almost as much annual revenue as all the other casinos in Korea combined. A few years ago, the Korean market was seen as one of the most promising in Asia, attracting interest from some of the biggest names in the industry. Tourism inflows were strong, especially from China, with its brand rising internationally due to the K-pop phenomenon. Seoul’s international airport in Incheon is one of the biggest transport hubs in Asia and is just a few hours’ flight from Japan and China. However, a spat with China over the deployment of a U.S. missile system in 2017 highlighted the risks inherent with relying on tourism, with visitor numbers from China plunging 60 percent that year after Beijing banned tour groups to the country. Last year, numbers had recovered, with South Korea attracting 17.5 million visitors, with 34.4 percent from China and 18.7 percent from Japan before the Covid-19 crisis struck.

Heo pointed out that the three larger IRs in the country — Paradise City, Jeju Shinhwa World and Kangwon Land — have to an extent been cushioned as they have built up nongaming activities for locals and foreign expats, although most other properties in the country are small and don’t offer the same facilities. Despite the current crisis, Kim says that two other major projects in the Incheon area are moving ahead. Caesars Entertainment is building a $700 million IR which was scheduled to open next year. It’s about 28 percent complete and there is likely to be some slippage in construction due to the pandemic. Mohegan Sun is building a $2.5 billion resort, known as Project Inspire, which is due to be finished in 2022. After its recent merger with Eldorado Resorts, analysts have said they expect Caesars to focus on the U.S. domestic market. However, Kim says that due to the structure of the licensing system in Korea, Caesars will need to finish the resort. Korea issues a prequalification license to approved projects. Once the project is completed 100 percent according to the plans that were submitted, a full license will be granted. The prequalification license can’t be sold or transferred. “My guess is that both companies will definitely finish up their construction,” he said.

GROSS GAMING REVENUE Kangwon Land 2019 sales Q2

+5.7% -91%

1.52t

34.6b

GKL 2019 sales Q2

+2.2% -89%

490.75b

23.3b

Paradise 2019 sales Q2

+24% -68%

Losses mount as Covid crisis lingers 979.4b

74.6b

Lotte Tour gets go-ahead to move casino license Lotte Tour Development’s plan to move and to greatly expand its Jeju casino has cleared a major hurdle as the Jeju Casino Industry Impact Assessment Committee easily passed the proposal. The initiative involves moving the current LT Casino within the Lotte Hotel Jeju (the smallest casino on the island in terms of revenue) into the soon-to-be-opened 38-storey Jeju Dream Tower, expanding the size of the casino by almost five times, and thus creating, when it opens, South Korea’s third-largest casino. Lotte Tour Development says that it plans to move its company headquarters from Seoul to Jeju with the completion of the project, which it hopes will come in October.

All three of the major South Korean casino operators booked substantial financial losses in the April-June period as a result of Covid-19. Kangwon Land, which operates the only casino in the nation at which locals may gamble, but which had a very long business suspension period, recorded sales of only 34.6 billion won (US$29.1 million), which was less than a tenth of its normal level, resulting in operating losses of KRW103.8 billion. Privately-held Paradise Co. saw its sales decrease by more than 68 percent to KRW74.6 billion, with its operating loss on a consolidated basis reaching KRW44.5 billion. Grand Korea Leisure saw its sales in quarter fall more than 80 percent to KRW23.3 billion, resulting in a net loss of KRW23.6 billion.

Asia Gaming Briefings | September 2020

NORTH ASIA 12

JAPAN

Japan’s new PM promises to push for IRs The man who will replace Shinzo Abe as prime minister of Japan has promised he will push ahead with the development of IRs in the country, saying they are indispensable for the country’s tourism development.

“A

lthough people tend to focus only on the casinos, the government intendstopromoteIRsasplaceswith various facilities and hotels where families can come and stay during international conferences,” Chief Cabinet Secretary Yoshihide Suga recently told a local TV station. However, Suga gave no update on the planned IR timeline, which has already slipped as a result of Covid-19 and he may have to face up to a cold, hard, dose of reality when it comes to what is practical. On the face of it, having Suga as Abe’s replacement is the best outcome for those who advocate IR development in Japan. Suga has been Abe’s right-hand man for almost eight years and has personally overseen a significant portion of the government policymaking on the issue. Were another one of the viable ruling party candidates to have come out on top, they all would have been generally favorably disposed to IR development, but none of them would have had the same “skin in the game” that Suga does. Moreover, it is widely believed—though the direct public evidence is lacking—that it was Suga who pushed Yokohama Mayor Fumiko Hayashi into the IR race at considerable expense to her own political reputation within the local community. Suga is a Kanagawa-based lawmaker and appears to strongly desire that his local area should host one of the first IRs in the nation. As prime minister, however, he is going to have to balance his own pro-IR inclination against a number of sobering political and practical factors that all argue for him to delay the development timeline. While Suga is anticipated to win his Liberal Democratic Party presidential election in a decisive fashion, his emergence as the nation’s leader will have been very much an insider’s affair, arranged by a handful of ruling party grandees with no real public input. In fact, the polls show clearly that the general public prefers his rival Shigeru Ishiba by a wide margin.

Asia Gaming Briefings | September 2020

While it can be expected that, once he is installed as prime minister in mid-September, his poll numbers will rise significantly as the public looks hopefully upon their new national leader, the initial honeymoon will include a lot of very soft support that could easily evaporate. Prime Minister Suga will be obligated to

call a new general election by October 2021—a little over a year from now—and his priority, should he wish to avoid the fate of becoming just a forgettable caretaker leader, will be to curry support with the public to see him past that first major hurdle. Should he survive beyond that stage, and

NORTH ASIA 13

presuming that the general elections will be held next summer (and they could come earlier), political attention will almost immediately become focused on July 2022 when the next House of Councillors elections will be held. Those who believe that Suga will simply move forward with IR development according to the current schedule are required to believe that a new prime minister, in the midst of trying to establish himself and facing two national elections in less than two years, is willing to champion a profoundly unpopular policy in the middle of a global pandemic and a national economic meltdown. That’s a stretch. More likely, should he survive the two national elections with the ruling party’s firm majority still intact, then perhaps in the autumn of 2022 it might make sense for Suga to return to the IR development policy that he believes in. Until that time, it is probably best to keep it on ice and out of

the newspaper headlines as much as possible. There are also some non-political, practical reasons why it makes sense to put

The polls show “clearly that the

general public prefers his rival Shigeru Ishiba by a wide margin.

”

the brakes on the process, mainly related to the Covid-19 pandemic. There is no reason to dwell on them because we have covered these points in

Pachinko industry

previous weeks: With the financial losses being suffered by many gaming companies around the world, this is just about the worst time to expect them to invest billions of dollars in a new market that—while absolutely promising—is creating a highly questionable regulatory regime and may make it near impossible for these firms to recoup their investments and make profits commensurate with the risks. But even if there is a delay for a couple of years, there is still plenty of important preparatory steps that can be taken now. For example, the number one concern of the Japanese public regarding IRs remains the issue of gambling addiction. While the Abe government did pass a mostly symbolic bill, there has been no discernible progress in addressing the issue. It would both make political sense and be good public policy to create a robust anti-addiction bill.

(in hundreds of millions of yen )

Sales according to the White Paper Leisure 300.000 200.000 100.000 0

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

(Source: Pachinko Industry Web Reference)

Pixel Companyz teams with Partouche

Get Nice focuses on Huis Ten Bosch

Tokyo-listed firm, Pixel Companyz, has announced its entry into the Japan IR race, unveiling an alliance with French casino operator Groupe Partouche. Although the company statement gave no information about the jurisdiction that it was interested in, Partouche had been exploring the possibility of a joint IR bid with Oshidori International in Nagasaki, and most likely this is the candidate site they are focused on. The statement declared, “The inclusion of Groupe Partouche contributes another extraordinary aspect to Pixel’s Japan IR consortium, which aims to incorporate aspects of Japanese, Asian, and European culture into a unique and symbolic IR facility. Groupe Partouche brings nearly fifty years of extensive casino business experience in the competitive European gaming market and is also known to progressively introduce new technology and data analysis methods to their operations.”

Get Nice Holdings is moving forward with its IR bid in Japan, which now focuses on the Huis Ten Bosch candidate site in Nagasaki. Get Nice’s pitch in Japan is being conducted through its subsidiary Genius Wise Holdings in partnership with the Current Corporation, a subsidiary of the Shotoku Rinaldo Corporation. This alliance initially aimed at building an IR in Makinohara city, Shizuoka Prefecture, during the period in which that municipality’s leaders were trying to organize a bid, but with the collapse of that initiative they refocused their attention on Nagasaki. In the latest filing, Get Nice revealed that it has paid the Current Corporation a total of HK$25 million (US$3.3 million) as a token of its sincere commitment to the Japan IR bid.

Asia Gaming Briefings | September 2020

FOCUS 14

Ball games bounce back!! Major sporting events are slowly ramping up around the world and with them the drama and surprises, not all of them good for sports betting operators.

addyPower concedes it was thumped to the tune of GBP580,000 after Bayern Munich humiliated Barcelona with an 8 goal to two defeat in the Champions League Quarter Finals in August. Still, at least the live events are back and in this edition we dedicate our Focus Section to betting on sports. In our first article, some leading sports book companies share with us their experience of getting through the Covid-19 shutdowns and how flexibility and a focus on eSports and virtuals has helped them through to the other side. They also discuss the booming prospects for the market in Asia and hold out the tantalizing hope that more jurisdictions around the region may be tempted to regulate their markets post pandemic. In our second article, we focus on India. A bill to regulate sports betting there has lapsed due to general elections and resurrecting it hasnâ&#x20AC;&#x2122;t been a priority for the new government. However, fantasy sports are booming.

Asia Gaming Briefings | September 2020

As a skill-based game, it is considered legal, although experts warn itâ&#x20AC;&#x2122;s important to ensure your business model truly does require a preponderance of skill. The sector took a breather from its stellar growth during the pandemic-mandated sporting hiatus, but is expected to come back with a vengeance as the India Premier League cricket tournament begins mid month in the United Arab Emirates. In our third piece, sports betting expert John English, who has more than 30 years of experience in the business, working in multiple jurisdictions, offers his views on the impact of the Covid-19 pandemic on the global sports betting industry. This year the unthinkable happened with all global sporting events cancelled, leaving the sector reeling in shock. But adapt it has, and there is light at the end of the tunnel. However, John argues that itâ&#x20AC;&#x2122;s high time for companies to have the ability to have online channels available to help spread the risk of events such as this on the land-based sector.

FOCUS

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FOCUS 16

Punters flood the sports betting zone Kung Volleyball, ping pong and Tajikistan football leagues are just some of the exotic sports that saw wagering action during the pandemic shutdowns, though now regular events are opening up, operators are noting a big swing back to old favourites.

ootballers have returned to the pitch in Europe, albeit without live audiences, while similarly fans were not on hand to witness U.S. Open favourite, Novak Djokovic, eliminated after hitting a line judge with a ball. The punters have returned nonetheless and still have a strong appetite to wager on sports. “The return of sports is a shot in the arm for the

Asia Gaming Briefings | September 2020

industry,” Pronet Gaming Sportsbook Director Thomas Molloy said. “Players have flooded back in their droves to wager on their favourite sports again. We have enjoyed our best summer on record and with the start of all toplevel football back in September we are in for a busy end to 2020, providing Covid-19 remains under control.” Through the pandemic, Pronet was able to offer more than 50,000 in-play events per month as it ramped

FOCUS 17

up its products with eSports and virtual sports content. It also rolled out a simulated reality product, allowing betting on the top-level events that had been postponed. “Since the return of live sports, betting behaviours have gravitated back towards pre-Covid-19 norms, especially with staple sports events like top-flight football,” Molloy said. “Although punters may have been forced to bet through different channels, money lines, handicaps and totals remain as popular as ever.” Sergey Tsukanov, head of sportsbook at BetBy concurs there has been a strong swing back to real sports. “The schedule of sporting events is very compact since the return of live competitions, so there are consistent and high levels of betting activity, rather than it being heavily weekend focused,” he said. “We are even seeing American sports, such as the NBA and NHL, attract more interest because they offer

We are even “seeing American

sports, such as the NBA and NHL, attract more interest because they offer evening entertainment for sport-starved fans.

”

evening entertainment for sport-starved fans.” During the crisis BetBy pivoted its focus to a new range of AI-driven esports titles,

offering players digital versions of sports they already follow and understand. “The diversification of our product offering was a very exciting time, but equally interesting was the increased exposure and take up of betting on other sports, such as table tennis or obscure leagues.” In Asia, the market post-Covid is expected to continue to expand following a widely reported spike in online gambling during the lockdowns. There is some speculation too that the crisis may be a chance for governments to rethink their bans on sports betting and other forms of online activity due to the levels of revenue they are missing. iGaming and betting consultant Anutosh Chatterjee said there had been an increased level of chatter amongst politicians in India due to the surge in online betting during the crisis. He said the government in Delhi is ultimately likely to legalize and regulate online gambling and sports betting, though not in the short term as the wheels of government grind slowly. In the meantime the market is thriving and according to Chatterjee, the Indian gambling market is now thought to be worth about $100 billion. “Sports betting is a big part of Asian culture today and will continue to be long into the future. Wagering activities are gaining ground in countries that formerly had strict gambling policies — especially the ones in the Asia-Pacific region,” Pronet’s Molloy said. “Overall, the Asian market is seeing a trend towards increases in betting and gaming revenue, which will continue to rise as more countries give the greenlight to online markets,” he adds. BetBy’s Tsukanov also believes that as the market grows, governments will ultimately be tempted to regulate and reap the benefits of taxation revenue. “Legalisation has already occurred in some countries, and with the shuttering of land-based casinos in others, we may see even more nations regulate sports betting in the coming months and years,” he said. “The US has become a country which sets an example for plenty of nations, and legalising sports betting is no different,” he adds. “Other countries will look to move in the same direction after seeing the benefits of regulated betting.” “Asia is a huge market in terms of both population and potential, and if leading players in the region were to regulate, it could become a focal point for some of the most exciting times sports betting has ever seen.”

Asia Gaming Briefings | September 2020

FOCUS 18

Fantasy sports await IPL’s return While sports betting remains illegal in India, betting on online fantasy sports (OFS) has been the biggest growth area of the country’s online skill-based gaming industry.

t’s the one sector of online gaming in the country that hasn’t benefited from the extensive lockdowns, seeing a sharp downturn in activity as actual sports tournaments evaporated. However, with the imminent return of the India Premier League cricket, fantasy sports are expected to bounce back with a vengeance. One illustration of just how far this nascent industry has come is the emergence of the largest player in the market, Dream 11, as the lead sponsor of the league, knocking off

Asia Gaming Briefings | September 2020

household names such as mobile company Vivo and PepsiCo. “Indian Premier League cricket is by far the most popular sporting event in India,” says Ranjana Adhikari, a lawyer with Nishith Desai. “It’s the equivalent, or if not more, than the World Cup, it’s almost like a religion in India. Fantasy sports are looking forward to this as finally a live event.” Prior to Covid-19, the figures for OFS had been impressive. According to a recent report by

FOCUS 19

consultancy firm KPMG and the Federation of Indian Fantasy Sports gross revenues of OFS operators stood at 2,400 crore for the 2020 fiscal year, compared with 920 crore the prior year, an increase of about three times. The user base of the platforms has surged from two million in 2016 to 90 million in 2019, with the number of platforms surging from less than ten to more than 140 operators at the end of last year. Cricket is firmly at the centre of the industry accounting for about 85 percent of the market, with the IPL itself generating about 35 - 40 percent of the revenue. Dream 11 dominates, with about a 90 percent market share. Backed by China’s Tencent, the startup was India’s first gaming unicorn, gaining a valuation of more than $1 billion. A trail blazer in the market, the company also won a landmark court case in the High Court of Punjab and Haryana in 2017, establishing a legal basis for the industry. Broadly speaking the ruling has been interpreted as giving legal blessing to OFS as a skilled-based game, whilst in practice, it was the specific business model that was approved. Adhikari explains that in India, a skill game must be able to prove that it has a higher than 50 percent level of skill involved. “Courts have looked at the format. With Dream 11, you make a team and there are certain rules you adhere to and there are restrictions. You are perhaps increasing the difficulty level in regards to sports betting,” she said. “If your business model follows that you have a good case.” When it comes to actual sports betting, it remains a legal grey zone in India. A bill was put forward to parliament two years ago that pushed to establish a legal framework for the industry, however, that lapsed due to federal elections and has been pushed down the priority list. “Sports betting is ‘perceptually’ not allowed rather than legally,” she argues. “There is an argument based on precedent that says sports betting should be allowed.” An interesting step forward has been taken during Covid-10 when it comes to horse racing and online betting. Several turf clubs, including Bangalore, have requested to be permitted to accept online bets due to the lockdowns and have received authorization. The spike in online gambling in India during the Covid-19 crisis has generated a high level of publicity across the country, sparking debate and push back over legality. That said, so far there has been no serious

challenge and the status quo remains, that in the majority of states skill-based games, such as OFS, eSports, poker and rummy are legal, even when played online for money. “Online skill gaming in India was already on a growth trajectory in the first half of the calendar year and the last quarter has witnessed a major spike in the business,” said Roland Landers, head of the All India Gaming Federation. “The Industry is selfregulated and all the AIGF stakeholders, including its OFS members have adopted the

self-regulation charter in their businesses.” FIFS has expressed a similar view. It’s members follow a charter and are self regulating. However, problems have arisen from offshore operators targeting the Indian market with games that push the envelope of what is skill-based and what is pure chance. Legal experts say any company wishing to operate in the sector needs to take a highly prudent approach and seek legal counsel as to whether their business model will pass muster.

Asia Gaming Briefings | September 2020

FOCUS 20

John English*

CEO, WEBE Gaming

Is it time to rethink the industry or is it business as usual? In the midst of the COVID-19 pandemic, which has pretty much decimated brick and mortar casino and betting shops worldwide, is there light at the end of the very long tunnel?

believe the answer is a solid yes, without doubt. Although there is not yet a vaccine that has been approved for global human consumption there appears to be hope on the horizon that one or more could arrive by the end of 2020. Once immunization and ongoing safety protocols become commonplace travelers should resume visiting integrated resort and sporting destinations and the gaming sector will gradually recover including sports betting and other forms of live entertainment. Since mid -March the world of sports has not been the same as punters with pent up demand were wagering on table tennis, Korean and Taiwanese baseball, and the somewhat new but fast-growing sector of esports. However, over the last couple of months sporting events are happening and it appears to be on the road to recovery, even if itâ&#x20AC;&#x2122;s in a bubble, punters are placing their stakes.

Asia Gaming Briefings | September 2020

So where is the light and when will we reach it? After speaking with a plethora of operators of casinos and sports betting operations to hear what their plans are for the immediate future and beyond, the consensus seems to echo the same common-sense sentiments. First, we need a vaccine and or treatments that will quell the fear of public interaction, secondly, we need to maintain temperature checking, sanitizing and cleanliness, and most importantly we need to move on with our lives and reopen cautiously. I feel that is a good start to rebuilding the trust with the public to leave their homes and it is a proper way to handle brick and mortar facilities as sanity is also important and locking people down in their homes will not be the infinite answer. I hope and believe that 2021 will be the year that 2020 started out to beâ&#x20AC;ŚProsperous. With that being said I am a firm believer in the future of online gaming and sports betting more than

FOCUS 21

ever, and I have been an avid supporter since the internet became a reality, it has proven to be entertaining, engaging and most importantly safe with proper regulation. I am looking forward to the future of online gaming to not only recover lost revenues and add much needed gains but also to keep our industry healthy and people employed. As we witnessed many jobs were lost and positions eliminated from the land-based operations. Places like Macau, Philippines and Las Vegas are heavily dependent on visitation and with border and flight restrictions, employment and stock values fell rapidly in the gaming sector. With online gaming and sports betting, I see the light ahead and 2020 will be in the rear-view mirror soon enough, new jobs are being created, people can be entertained from the comfort of their home, and vast growth is happening. Some jurisdictions in the U.S. and Asia are already regulating and embracing online gaming as a lifesaver, a growth vehicle, and also as a way to maintain an ongoing relationship with their customers. Approximately 60-70 percent of sports wagers come over mobile phones and what was once called the second screen, this year the tablet or PC have become the main screen. From a casino perspective Live dealer games such

as roulette, Blackjack, and Baccarat are as close to being in the casino as possible, slot games, bingo, keno, and lotto are all available to play remotely. In the online sector we

â&#x20AC;&#x153;

In the online sector we have seen several billiondollar mergers and acquisitions and even public offerings carry on without delay.

â&#x20AC;?

have seen several billiondollar mergers and acquisitions and even public offerings carry on without delay. Many casino properties are tied to online companies and sports betting and media partnerships are being announced weekly. Sports betting may have had the largest

impact online since there are many things that can be done from your smartphone or laptop that are sometimes cumbersome in a betting shop or over the counter at a casino point of sale. The thin margins in sports betting have found a growth sector with in-play wagering, early cash out, easy funding and a wide variety of sporting events all within reach of an app or a browser. The COVID-19 pandemic was not predicted and for the last 35 years I have always felt that as a sportsbook operator we would never experience a complete shutdown and then the unthinkable happened and it happened fast. Iâ&#x20AC;&#x2122;m thankful for online wagering and the passion and creativity of our industry to move past this moment in time. I hope to see more regulators and operators in global gaming territories use technology as a beacon to see our way through the tunnel and into a bright future. * A well established entrepreneur in the online gaming space, John English has worked in the gaming industry for more than 30 years. He is a partner and managing director, Sports Betting and Technology at Global Market Advisors and is the founder of Webe Gaming.

Asia Gaming Briefings | September 2020

SOUTH EAST ASIA

MALAYSIA

Will Malaysia open up to online gambling? The market regulator in the Philippines has taken the unusual step of claiming that Malaysia, a strictly Muslim country where gaming is highly restricted, is trying to woo online gaming companies.

n a memorandum of understanding sent by PAGCOR Chair Andrea Domingo to the Office of the President, she claims that Malaysia is offering a ten-year tax moratorium on condition that at least 30 percent of employees are Malays. The news was reported by the government-backed Philippine New Agency. PAGCOR was writing to the government in relation to a 5 percent franchise tax on gross gaming receipts. The memo follows recent departures of several online gaming firms from the Philippines due to the rising cost of doing business there. In a rebuttal of PAGCOR’s claims on the franchise tax, BIR Commissioner Caesar Dulay said he doubted Malaysia was offering licenses as all forms of gambling are banned. The statement isn’t true as Malaysia has one land-based casinos, lottery shops (TOTO, Magnum and Damacai), Slot Clubs located at golf-clubs and also horse racing at the turf club. Malaysia’s Deputy Minister of Communications and Multimedia, Datuk Zahidi Zainal Abidin, recently told national TV3 that the country had seen a huge increase in online gambling activity during the Covid-19 lockdown, despite an ongoing crackdown. He suggested that it may be better to regulate and tax these operations, as stamping out the activity entirely was proving to be impossible. The government hopes to appoint an official government body to monitor, regulate, and tax the appropriate parties, he told the television channel. Gambling is divided into three categories: a) Malaysians gambling on overseas websites; b) Overseas people gambling on Malaysian websites; c) Local Malaysians gambling on Malaysian websites. “This will be the three parties that will be taxed accordingly. Even though Malaysia is a Muslim country, there is especially a race (Chinese) who loves to gamble. Muslims must be 100 percent prohibited from gambling but non-Muslims can gamble,” he said, according to a translation provided to AGB. Over recent years, Malaysia has stepped up its enforcement action against illegal gambling operations, many of which are online. However, there continues to be weekly reports of new operations. In August, Seberang Perai Utara district police chief, ACP Noorzainy Mohd Noor told local media its Anti-Vice, Gambling and Secret Societies Division (D7) had conducted 25 raids and arrested 15 individuals including

SOUTH EAST ASIA 25

four women aged 21 to 39, in the operations Houses Act 1953, Betting Act 1953 and Pool Betting Act 1967 govern the gaming industry conducted from July 1 until August 10. “We found that the modus operandi of in Malaysia, but have not been reviewed for decades. the gambling agents The government was to operate at the has begun a process to back of other business Even though update the legislation, premises such as clothing, grocery and Malaysia is a Muslim w h i c h d o e s n o t specifically refer to mobile phone shops. country, there is online gambling. “We also found It had b e en that the front door especially a race assumed that such a of the premises had (Chinese) who loves review would result a hole or there was a in a similar outcome special space for their to gamble. to Singapore, which illegal transactions. We imposed a draconian believe the activities ban on all forms of were carried out 24 hours, especially for the convenience of their online gambling. However, the more recent comments from the government suggest a customers,” he told reporters. The Lotteries Act 1952, Common Gaming potentially more liberal view.

“

”

GROSS GAMING REVENUE

(in RM’m) 7,067

7,000

5 YEAR CAGR: +6%

6,000 5,000 4,000 3,000 2,000

1,225

1,000 0

FY14

FY15

FY16

FY17

FY18

FY19

1Q19

1Q20

NFOs see sales bounce back Malaysia’s number forecast operators are seeing a strong snap back after reopening following the Covid-19 shutdowns. The outlets were permitted to reopen on June 17. According to local media, Berjaya Sports Toto told investors that a month after reopening, sales per draw had got back to 75 percent to 80 percent of pre-closure levels. “BST stated that sales are returning in tandem with footfall. Since reopening, sales/draw has been recovering by 4 percent to 5 percent per week,” Maybank Investment Bank Research said in a report. “That said, BST concedes that fewer foreigners have been betting due to the government restricting their movement. Locals have also been betting more with illegal NFOs for fear of going out and betting at NFO outlets. All the same, BST hopes to drive sales/draw to pre-closure levels soon.”

Asia Gaming Briefings | September 2020

SOUTH EAST ASIA 28

philippines

Projects advance as long-term optimism undented Operators in the Philippines say they are moving ahead with their capital expansion projects, expressing optimism in the future of the market.

“W

e remain very committed to the long-term growth story of tourism and gaming in the Philippines,” PH Resorts Group Holdings Chairman Dennis Uy recently told shareholders. “While many challenges remain, we are confident of overcoming them as we see some recovery by the time the first phase of Emerald Bay is completed and opened to the public.” PH Resorts is developing the Emerald Bay Resort on Mactan island, which is now scheduled to open in late 2021. Designed by Steelman Partners, the resort spans 12 hectares and will be the largest IR in the country outside of Manila. PH says the debut will be late in the year, with the full Phase 1 offering to be available by the second quarter of 2022. “Despite the challenges of COVID-19 we are diligently working on the completion of the

Asia Gaming Briefings | September 2020

first phase of Emerald Bay,” Chief Operating Officer Jose Angel Sueiro said. “Our team continues working to ensure to reduce project costs without sacrificing quality. Our focus is getting Emerald Bay to open on time without cutting corners.” Emerald Bay will have a total of 146 gaming tables and 729 electronic gaming machines (EGMs) as well as 780 hotel rooms and 5 villas. In the early opening phase it will have 122 gaming tables for mass, premium mass and junkets, 600 EGMs and 270 hotel rooms. Bloomberry Resorts & Entertainment also expressed confidence in the market’s future prospects saying it’s going ahead with its plans for a second IR in Quezon City, known as Solaire North. Chairman and CEO Enrique Razon said it believes the opening of the resort will “coincide with a meaningful upcycle that is typical after a

period of economic weakness.” Bloomberry is now targeting a late 2022, or early 2023 launch for the property, which will be on a 15,676-square-meter piece of land and will be very similar to the original Solaire’s layout. It will be targeted at the mass market and in particular to locals. Hong Kong-listed Suncity Group Holdings is also showing its commitment to the market, putting up an additional $82 million deposit to Westside City Resort World. This represents the third refundable deposit following earlier installments of US$20 million and US$46 million, making a total of US$148 million. Moreover, Suntrust currently has until December 31 to raise at least US$300 million for the construction and development of the project, under the terms of the agreement. In February, Suncity announced that its

SOUTH EAST ASIA 29

INSTALLED CAPACITY AS OF december 2019 Tables

Electronic Gaming Machines

PAGCOR Casino Filipino

481

City of Dreams Manila

306

Courtesy: By Ramon F. Velasquez

Resorts World Manila

2,310

370

2,134

Solaire Resort and Casino

398

2,340

Okada Manila

444

2,591

ThunderBird - Rizal

266

ThunderBird - Poro Point

384

Fontana Casino

Royce Casino

304

Midori Casino

312

Widus Hotel and Casino

440

Fortunegate

local SunTrust unit had signed a twenty-year lease agreement with Westside to develop and operate its casino hotel as part of the junket group’s extensive expansion plans. Suncity acquired a controlling stake in SunTrust last year for the rights to build a five-star hotel with at least 400 rooms, a casino with 400 gaming tables, and 1,200 slot machines for both mass and VIP markets, and a 960 space parking lot. Under the lease agreement, Suntrust will pay an annual rental fee of US$10.6 million, commencing on the first day of operations of the casino and payable in two installments on a semi-annual basis. Landing International, whose Manila project was shut down on the day it broke ground due to irregularities in the land lease, is also still keen to move ahead with a project in the Philippines. The company had been ordered by the Philippine Amusement and Gaming Corp to find an alternative site, which it hasn’t been able to do because of the lockdown. It has now been granted an extension to the deadline to find the land. Casinos in metro Manila have been closed since March as part of a strict community lockdown. They are now being allowed a limited reopening at 30 percent of capacity after having only been allowed to accept selected VIP guests to maintain training and facilities during the shutdown.

9,641

D’Heights

151

560

Number of Electronic Gaming Sites eBingo

617

Electronic Games Sportsbetting (MSW)

270

106 (Source: Pagcor)

HatchAsia extends lifeline to Silver Heritage HatchAsia has put forward a proposal to take over Silver Heritage and inject A$530 million (US$387 million) in cash into the ailing company. Hatch will buy shares equivalent to 92 percent of SVH’s issued shares from existing shareholders and the issue of new shares. The settlement involves $530 million in cash and 3 percent of the issued shares. The successful conclusion would eventually result in the HatchAsia shareholder-controlled entity being listed on the Australian Stock Exchange and Philippine affiliate DFNN owning part of the ASX Listed Entity. “As a shareholder, we welcome and look forward to the foray of HatchAsia in the international market. A move that will consequently provide us better access to a wider capital base as well as create new business streams for a larger audience reach that will pave the way for more Philippine businesses to globalize. Tapping the Australian capital market for this provides a conducive environment for the nature of our businesses and allows DFNN to fully value its early investments in HatchAsia”, says Calvin Lim, CEO of DFNN and incoming director of HAI.

Asia Gaming Briefings | September 2020

SOUTH EAST ASIA 30

City of Dreams The $1.3 billion City of Dreams Manila is owned by Belle Corp and Melco Crown Entertainment’s local unit. City of Dreams Manila has six hotel towers with approximately 950 rooms in aggregate, including VIP and five-star luxury rooms and high-end boutique hotel rooms, a wide selection of restaurants and food & beverage outlets and a 4,612.44 square meters family entertainment center in collaboration with Dreamworks Animation. For the second quarter, Melco Resorts Philippines posted a net loss of P2.4 billion (US$49.3 million) due to the closures. City of Dreams Manila’s rolling chip volume was US$0.15 billion versus $1.90 billion in the second quarter of 2019. Mass market table games drop decreased to $7.5 million, compared with $192.8 million in the second quarter of 2019. Total non-gaming revenue was $1.4 million, compared with US$31.8 million in the second quarter of 2019.

in gross gambling revenue during the three months through to end-June to P686 million. The company swung to a loss of P4.7 billion, compared with a profit of P2.5 billion in the same period last year. Solaire’s VIP, mass table, and EGM GGR in the second quarter were P121.7 million, P303.7 million, and P261.1 million, representing year-over-year declines of 98 percent, 93 percent, and 94 percent.

Resorts World Manila Travellers International Hotel Group, a joint venture between Genting Hong Kong and Alliance Global, is the owner and operator of Resorts World Manila. The hotel room count for the group’s three hotels (Maxims

Hotel, Remington Hotel, and Marriott Hotel Manila) remains at 1,226. The group recorded a net loss of P3.7 billion in the first half of 2020. The company’s casino was closed from mid-March and was given the green light to operate at 30 percent capacity from the end of August. Prior to that the resort was only permitted to invite select guests for so-called dry-run operations. Gaming net revenues fell 59 percent yearon-year to P4.4 billion, while non-gaming revenues fell 44 percent to P1.7 billion, due to foot traffic decline as well as the closure of the theatre, cinemas and retail outlets. The hotel has been operating at limited capacity with occupancy ranging between 29 percent to 60 percent in the first half of the year.

Tiger Resort Leisure and Entertainment Okada Manila, owned by Japan’s Universal Entertainment, is the largest resort in Entertainment City and the last to enter the market, with a soft opening in 2016. Net sales at Okada Manila fell 48.8 percent year-on-year in the first six months of 2020, to nearly JPY16.10 billion, while its first-half operating loss widened to nearly JPY5.27 billion, versus JPY1.82 billion in the same period of 2019. The parent company also said it has postponed a deal reached in February to sell land adjacent to the Okada Manila site in a deal worth about PHP13.18 billion. It said it expected to move ahead with the transaction in the future, but said the transaction may be amended.

Bloomberry Resorts Bloomberry Resorts’ Solaire was the first IR to open in Entertainment City and is a 16-hectare integrated resort. The Bay Tower of Solaire consists of a casino with an aggregate gaming floor area of approximately 18,500 square meters (including 6,000 square meters of exclusive VIP gaming areas), with about 1,400 slot machines, 295 gaming tables and 88 electronic table games. Bloomberry reported a 95 percent drop

Asia Gaming Briefings | September 2020

Waterfront turns profit despite Covid-19 Waterfront Philippines Inc recorded a narrowed profit in the second quarter of 2020, reaching P37.6 million (US$773,086), despite community quarantine lockdown affecting casinos in the region. The company said the beginning of Q2 was “quite a downturn” as the COVID-19 pandemic struck, severely affecting occupancy and volume of revenue for all three of its properties. The company runs two casino hotels in Cebu, including the Waterfront Cebu City Hotel and Casino and Waterfront Mactan Casino Hotel, and one in Manila, the Waterfront Manila Hotel and Casino. Net income fell 77.7 percent to P105.8 million in the quarter ending June 30, 2020, down from 187.9 million in the prior-year period. Revenue fell 25.9 percent to P702.7 million.

WE SURVEYED 500 PUBS

AUSTRALASIAN GAMING SURVEY

Covid-19 Response

Q. WHAT is the most important learning you have gained as a result of the crisis?

Q. WHAT actions have you taken regarding egms?

& CLUBS

Used Signage

56%

Increased Distance

56%

Deactivated EGMs Moved Machines

ACROSS

Reduced the Number

ANZ ...

Surrended Machines

AND HERE ARE THE RESULTS.

Explore gaming industry data from a truly insightful perspective and use it to transform your business challenges and opportunities into valuable commercial assets.

46%

Set up Screens

Q. WHAT PAYMENT RELATED CHALLENGES HAVE YOU FACED?

31% 22% 8% 1%

Q. WHEN DO YOU EXPECT REVENUES TO RETURN TO NORMAL?

Paying Suppliers

68%

Paying Utility Blls

56%

Paying Saff

47%

Paying Rent

44%

Paying Contractors

Revenue is Normal (11%) In less than 6 months (6%) In 6 months to 12 months (17%)

35% 0

In 12 months to 24 months (48%) It will take longer than 24 months (18%)

Q. HOW MANY EGMs ARE CURRENTLY ACTIVE?

Q. VISITATION IS AT WHAT % OF PREPANDEMIC LEVELS? NSW VIC QLD

Less than 25% are active (13%) Between 25 and 50% are active (16%)

Other 0

100

Between 50 and 75% are active (39%) More than 75% are active (32%)

Weekday

Weekend

Asia Gaming Briefings | September 2020

AUSTRALASIA

AUstralia

Two-year wait for gaming demand to normalize Australia’s gaming venues may have to wait as long as two years for gaming revenue, demand, and turnover to return to “normal levels,” according to gaming analysts.

Asia Gaming Briefings | September 2020

he analysts were speaking as part of the three-day Australasian Gaming Seminars, organized by the Gaming Technologies Association in partnership with Asia Gaming Brief, in August. “When you look at post-Covid consumer behavior, you’re going to see subdued behavior. When you look at casinos, around 70-85 percent of earnings are domestic, but you have reasonable earnings from international visitors. With borders closed, you’ll not likely see FY19 earnings until around FY2023,” said Don Carducci, a gaming analyst at JP Morgan Australia. Vicky Melbourne of Fitch Ratings, who focuses on Asia Pacific gaming, said that her expectations for Asia’s operators are not too dissimilar to that of Australia. “We found that our forecast from April to August is starting to shift. We said earlier in April that between Las Vegas, Macau, and Singapore, we expect EBITDA to fall 45, 50, and 38 percent respectively compared to 2019.” Fitch Ratings now sees Las Vegas, Macau, and Singapore to fall 60, 70, and 65 percent respectively. Melbourne said besides economic impacts, the three markets will also suffer from continued travel restrictions and border closures – which is potentially less of an issue for a market such as Australia, which is geared more towards the domestic business. “What we have seen domestically is a resilient set of players. As venues have reopened, people have come back faster and stronger than initially expected,” said Matt Ryan of UBS. “Perhaps the fear of going back to these places was overdone.” Ryan said he expects that the recovery of Australia’s gaming industry will be reliant mainly on the restrictions set by the government, rather than players’ appetite to spend again. Whilst the economy will have an impact on gaming spend – this is currently hard to judge due to government economic packages that have “propped” up consumer spending, added Ryan. “Job keeper will and has artificially buoyed an amount of turnover in the industry, and we’ve seen this across the lottery industry since March, along with an overall 26 percent rise in gaming expenditure.” In the 2011 Queensland floods, the related government injections saw racing grow around 5 percent whilst lottery grew in the teens, explained Carducci. “Where we remain cautious is around consumer sentiment when job keeper comes off in step changes, as well as the fear of traveling and social distancing rules,” he added.

AUSTRALASIA 33

The analysts’ views were echoed by more than 500 CEOs across Australia who were asked about their experience during Covid-19 in a joint survey between Forecast Australia, Asia Gaming Brief, and the Australasian Gaming Expo. Presented by Forecast Australia Director Greg Norman, the survey received an enthusiastic response from Australian pubs and clubs, especially in the states of Victoria, New South Wales, and Queensland. The survey revealed that the economic impact has not fallen evenly across the nation: Victoria state has seen the gravest downturn, while Queensland has largely shaken off the crisis so far. Moreover, metropolitan areas have

been hit particularly hard, while pubs and clubs in suburban areas have not suffered nearly so much, as they are closer to people’s homes. Some of the specifics revealed in the survey were, for example, that a plurality of venues have between 50-75 percent of their EGMs currently in operation and that over two-thirds have reported that the cash crunch has presented challenges in terms of paying suppliers. Generally speaking, the CEOs of these pubs and clubs anticipate recovery to take more than a year. Among the key lessons learned through the crisis is the critical importance of communication, especially with staff, but also with patrons and business partners.

GROSS GAMING REVENUE CWN Mel

CWN Per

SGR Syd

SGR QLD

yoy growth %

6,000 5,000 4,000 3,000 2,000 1,000 0

2013

2014

2015

2016

2017

2018

2019

2020

2021E

+6%

+3%

+24%

+3%

-9%

+7%

-6%

-26%

-30%

(Source: J.P. Morgan)

Star Sydney fined as 12-year old found gambling The Star Sydney has been hit with a total of A$90,000 (US$65,000) in fines due to underage gamblers making it onto their casino floor, including an incident involving a 12-year-old girl. While The Star selfreported all three of the incidents, which occurred between March and July 2019, NSW Independent Liquor and Gaming Authority (ILGA) argued that the company could reasonably have prevented the breaches and was not sufficiently alert. ILGA Chairman Philip Crawford, discussing the case in which a 12-year-old from China spent 17 minutes playing a poker machine after being snuck in a back door by her mother, stated, “It’s quite staggering that the young girl’s parents facilitated her entry in such a deceptive manner, let alone allowed their daughter to gamble.”

Crown Sydney on track for Dec. debut Crown Resorts said its new luxury resort in Sydney is still on track to open in December this year, despite the challenges posed by Covid-19. In its annual results announcement, the Australian operator said more than 1,300 workers are currently on the Barangaroo site to complete the project, which involves a 275-meter tower. Recruitment activities are underway for the 2,000 staff expected to be employed at the VIP-only property. The company has so far invested $1.7 billion. For the fiscal year ending March 2020, Crown reported a drop of 80.2 percent in net profit attributable to the parent company of $79.5 million. Its reported EBITDA was down 40.6 percent at $504.6 million, while revenue declined 25.7 percent. Main floor gaming revenue fell 26.9 percent to $1.23 billion, while VIP program play turnover was down 46.5 percent.

Asia Gaming Briefings | September 2020

AUSTRALASIA 34

new zealand

SkyCity battles through adversity Covid-19 is testing the mettle of global casino managers like no other crisis, requiring quick thinking and flexibility. But if there’s one team that’s been tested more than most, it’s the personnel at New Zealand’s SkyCity Entertainment.

n its latest financial year, the operator years having disappeared. was forced to handle the fallout from “Our domestic businesses have recovered a massive fire at its flagship develop- more quickly than anticipated when open ment in Auckland in October last year, and, if we can sustain this, the business is with the coronavirus pandemic shuttering not under threat and can wait it out until its casinos across the country a few short the world recovers,” he said. months later. On the upside, SkyCity has seen strong The government of Prime Minister growth in its online business, which it Jacinda Ardern won widespread praise for launched last year. The unit operates out of its handling of the crisis, seemingly having Malta, with content and the gaming platform eliminated new infections and allowing provided by Gaming Innovation Group. SkyCity to become one of the first operators Under current New Zealand law, only to reopen its doors. Government-owned Lotto and the TAB are However, it’s been a roller coaster permitted to offer online gaming from within and after more than New Zealand, however 100 days with no new many New Zealanders cases, Auckland saw a freely participate in On the fresh outbreak, pushing online casinos provided the casinos back into by offshore operators. upside, SkyCity lockdown from August These sites are estimated has seen strong 12th to 30th. to generate revenue of growth in its “An unprecedented about $160 million number of significant from the country. online business, strategic decisions and Stephens said the which it launched actions have had to be business had ramped up taken to mitigate the significantly from March last year. impacts of these events,” this year and was now CEO Graeme Stephens a profitable operation said in the company’s with more than 35,000 annual report. “Significant operational customer registrations. effort has gone into closing and reopening “We continue to prepare for a regulated our properties with rigorous health and online industry in New Zealand and are safety measures in place.” supportive of Government initiatives in Chief among those was the need to this regard.” reduce its workforce by about 25 percent to In the meantime, SkyCity is continuing reflect the new reality facing the business. with its current expansion projects, which it With the international borders still says are on budget and on time. This includes closed, Stephens acknowledges that for the the expansion of SkyCity Adelaide and Eos short-to-medium term SkyCity is going to by SkyCity, a new 120-room luxury hotel, be a smaller, domestically focused business, which is still scheduled to open later this year. with its international VIP segment, a sigIn Auckland, work has resumed on the nificant contributor to earnings in recent fire damaged New Zealand International

“

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Asia Gaming Briefings | September 2020

AUSTRALASIA 35

Convention Centre and related hotels. The NZCC is now expected to be completed by 2023. Looking ahead to 2021, Stephens said he sees an improvement on 2020, but business won’t be back to 2019 levels. “We expect the domestic businesses to continue to perform well when open but remain prepared for the possibility of further closures. We are planning for international borders to be closed for the duration of FY21, and that there will be negligible International

Gaming Association pans Salvation Army report

Gambling Expenditure 2017/18 NZ Racing Board (Tab)

NZ Lotteries Commission

Gaming Machines (Outside Casinos)

Casinos

2018/19

(in $m)

$350 $332

$561 $530

$895 $924

$578 $616

Total

Business and international tourism activity.” For the July to June 30th financial year revenues were up about 37 percent to over NZ$1.1 billion (US$765 million). More than 44 percent of these revenues derived from the flagship Auckland property, with smaller contributions from the Adelaide, Hamilton, and Queenstown facilities. However, net profits fell about 60 percent from NZ$164.6 million last year to NZ$66.2 million this year.

$2,383 $2,402

The Gaming Association of New Zealand has criticized a report that claims the gambling sector is costing industry millions, saying it is a serious misrepresentation of the facts. The Salvation Army and Problem Gambling Foundation outlined the significant economic benefit that would apparently accrue to the retail sector in both income and job creation if spending on gambling on pokie machines was halted. The report claims that this extra retail spending would generate an additional 1,127 full-time equivalent jobs for 1,724 workers, along with an additional $58 million of GST revenue and additional income tax of $7 million from the retail spend. “What the report is lacking, however, is any consideration of the economic value currently generated by the gambling sector – in fact, the report specifically acknowledges that this was outside its scope. It’s therefore a serious misrepresentation of the net value of such a move, given it takes no account of the value that would be lost,” the association said.

Lotto NZ apologizes for tech glitches Lotto NZ CEO Chris Lyman has apologized for some of the glitches in online services amidst a spike in gambling activity and said the company expects to have completely revamped its technology by 2024. The company began a $25 million project in 2019 to upgrade the MyLotto website and app, which it expects to be completed in early 2021. “To support the move to online play, and the big increase in the number of people playing online, Lotto NZ is making a substantial investment in the upgrade of MyLotto. The current website is ageing, and the upgrade is required to meet higher demand online,” said Lotto NZ Chief Executive Chris Lyman. “While this work is underway we have been making interim improvements. However, regrettably there have been some issues on MyLotto. This has in turn resulted in some pretty poor customer experiences, and for that I sincerely apologise.”

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 36

SBC INTRO

Mammoth digital conference This year, Asia Gaming Brief was selected to be the Premier Media Partner Asia for SBC Barcelona Digital Summit, held from 8-11 September, 2020.

landmark event for the sports betting industry, more than 10,000 delegates from around the world tuned in over the four-day digital conference and exhibition, in what would have been a mammoth task for the organizers. “Asia Gaming Brief is the premier B2B Media outlet in the Asian market and we are proud to have them as a partner and host for our largest and most global digital event,” commented Kelly Kehn, Global Relationships Director at SBC. The four-day event claimed to have one of the strongest speaker lineups in its history, with a keynote speech from Carsten Koerl, CEO / Founder of Sportradar, Jason Robins, CEO & Co-Founder of DraftKings in the mix, along with hundreds of other experts from the sports betting field.

Asia Gaming Briefings | September 2020

As part of the collaboration with SBC, Asia Gaming Brief co-founder Rosalind Wade moderated a panel during the “Global Gambling” track, focused on the future of the Asian market, titled “Asia – Adapting to the Future”. Asia Gaming Brief also organized and hosted a networking session during the event, called the Asia Networking Roundtable. Around 45 people with interests in Asia joined in on the chat. With 100 virtual exhibitors in attendance, and more than 10,000 delegates from around the world, the event would be seen as one of the most well-attended digital events in the gaming industry in 2020. Over the next few pages, you’ll hear from some of SBC Barcelona Digital Summit’s key digital exhibitors and their plans in the sports betting industry over the next year.

SUPPLIER SPECIAL REPORT 37 1xBet

Security, new games and exotic sports

hile many were taking a summer break, 1xBet worked on improvements and is ready to offer its users many new enhancements. This is what the bookmaker managed to accomplish over the past month: 1xBet is known for its wide betting line, but the bookmaker continues to develop further in this direction. Users now have the opportunity to bet in live mode on even more exotic sports such as Cross Volley. This is an increasingly popular form of volleyball, which will surely appeal to fans of

everything new. 1xGames are exclusive games available only at 1xBet. The bookmaker makes sure that these thrilling games can be enjoyed on as many devices as possible. Since August, visitors to the mobile version of the site have found new games such as Hi-Lo Triple Chance, GEMS ODYSSEY, OXO and others. 1xBet players now get the opportunity to bet not only on classic events like the outcome of a match or a handicap. For users of the desktop version, a new unusual betting format

is available - “Duel between players”. Users select a match and divide the players into two teams. Having assembled a team, you can place bets on whose “team” will score more goals! Messi and Ronaldo can be in the same team - this is possible with the “Duel between players” at 1xBet (if they overlap in the same game). Security is one of the strengths of the 1xBet app. Players can relax about the safety of their data, comforted in the knowledge that they now enjoy even more options for authorization and registration. IOS users can now register with their Apple ID. A handy feature that makes registration even easier and faster. Modern apps come with colourful interfaces, but you rarely get the opportunity to customize the elements for yourself. Luckily, the 1xBet Android app has a ton of cool tweaks to improve your experience. For example, connoisseurs of minimalism can activate the “compact type of bets” option, and in the tournaments section, there are more options for sorting and searching for desired events. At 1xBet, we have made sure that our users can place bets with maximum comfort. Constantly working on and enhancing the product is a key focus for the company. Become a partner of a leading bookmaker and conquer new heights with 1xBet.

Ainsworth

Ainsworth’s A-STAR shines

s we emerge from the shadows of COVID-19 it’s time to revamp gaming floors with the brand new A-STAR cabinet by Ainsworth. The A-STAR takes Ainsworth to the next level with a meticulously crafted cabinet that encompasses a sleek, modern, modular design, a dual screen format, dynamic LED lighting, and a state-of-the-art LCD touchscreen button deck. The new A-STAR cabinet has a unique and elegant design that integrates effortlessly with any décor. This cabinet has an ultra-thin form factor, providing genuine space integration and an element of futuristic luxury. The A-STAR has launched with the exclusive new brand Pan Chang! Pan Chang, a traditional Chinese decorative knot is also the Buddhist conception of continuity and the origin of all things. The series introduces the ‘Pan Chang’ Feature; a collection of ‘Pan Chang’ symbols where credit prizes, bonus prizes and the major progressive can be won. With three games

approved in the brands portfolio - Long and Happy Life, Endless Fortune and Guan Yu it’s sure to bring excitement to any gaming floor. Complementing Pan Chang, the next exclusive A-STAR brand is Rise Up! Rise Up encapsulates a multiladder feature with two jackpot progressive levels and two scalable bonus prizes. The Rise Up feature includes multiple awards during the ladder feature with chances to win the progressive jackpots. An additional free games feature provides an attractive feature hit rate desirable to players. Born Free and Wizards Wand are the first two games in this brand. Ainsworth continues to develop its product portfolio with advanced technology and software that delivers aesthetically pleasing art and engaging content. The launch of A-STAR and two strong brands, Pan Chang and Rise Up aims to support current customer gaming floors and diversify business models. www.agtslots.com

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 38 Astropay

Instant and secure deposits

stroPay is the pioneer payment solution for thousands of consumers in Latin America, Asia and Africa, who want to purchase online on international sites, that helps merchants access new markets through its main product, AstroPay Card. With AstroPay Card users can make deposits easily, instantly and securely. This virtual voucher is ideal for customers who need to perform real-time operations in their local currency. With a focus on international transactions, we address the complexities of local markets, offering fast and efficient solutions through thousands of consumer-recognized payment methods.

From a single integration, operators can also give their customers the ability to make withdrawals from their site, easily and safely. The process is done in real time and is very simple as it consists of generating an AstroPay Card with the amount they want to withdraw, in the selected currency, and this is sent to the user. The withdrawal system we have developed was designed to facilitate the work of merchants, avoid the inconveniences of managing various integrations, lower maintenance costs of different payment platforms, remove restrictions on the use of different currencies and exchange rates, and reduce costs associated with rejected transactions. All this is done from strict

compliance and high security procedures that guarantee the prevention of fraud. Our extensive experience in managing the specificities of different markets, allows us to offer an efficient solution to all our customers: merchants, end customers and business partners. We are a B2C company, that has been operating in different countries for more than 11 years.

Betconstruct

East meets West in virtual Expo

ward-winning gaming and betting technology provider BetConstruct has announced the launch of the East & West Virtual Expo, September 29-30, 2020. The free virtual expo will bring together exhibitors and visitors from across several industries including payments, iGaming, and blockchain technology. An estimated 300 exhibitors and 10, 000 visitors will join the two-day event, where they can connect and interact in a real-life environment. Never one to shy away from a challenge, the BetConstruct team decided to use the

Asia Gaming Briefings | September 2020

most advanced technology and their extensive expertise to help the industry keep moving forward and parallelly saving resources – time, money, and nature. “We are happy to welcome our peers and everyone interested in connecting with the iGaming industry. Using cutting-edge technologies and our knowledge, we hope to reinvigorate and reconnect the industry,” commented Vigen Badalyan, BetConstruct CEO. The East & West Virtual Expo is special in the tools and resources that will back the event. PandaMR’s virtual halls and booths will

create the impression of attending a real expo, where exhibitors will have the opportunity to showcase their products and offers. They will also be able to connect with visitors and other participants via voice and video chat, with spaces for private meetings. The main event, as well as a number of discussion panels and product presentations, will be held live. To make the expo even more unique, the organizers encouraged exhibitors to provide special offers and extras during the event. To find out more about the East & West Virtual Expo, please visit eastandwest.com.

SUPPLIER SPECIAL REPORT 39 betgames

Learning from the crisis

BBIN

Up for a sustainable future

ounded in 1999, BBIN has dedicated itself to the development and innovation of new technologies and system software. BBIN provides its professional platform integration services throughout Asia, including China, Japan, South Korea, Vietnam, Thailand, Indonesia, Malaysia, the Philippines and more. Currently, the company has successfully provided the market with 14 types of live casino, 40 lottery games, over 100 casino games and more than 50,000 sports betting products per month. Crossing the twenty-year milestone and moving toward the next from 2020, BBIN demonstrates its ambition for sustainable development and growth. It actively expands itself and branches out to collaborate with world-renowned brands in different fields. This includes world champion car-racing team Theodore Racing/ Prema, famous football club Dortmund, and Ajax. BBIN has also become a long-term supporter of eSports since 2019. Moreover, BBIN foresees the importance of corporate responsibility and founded The Gaming Beat (TGB) charity brand to help raise awareness on different topics. BBIN has brought together the world’s Top 100 DJs to voice their support for charity and worked with Trees for the Future and Water.Org to promote environmental protection. Through these collaborations, BBIN connects with the world beyond Asia, hoping to give back to the society and build a better world for everyone. BBIN welcomes collaborations from all the world, and provides the advantages of professional resources to partners who aim to map out their business in Asia. BBIN is ready to show the world its capability of bridging the eastern and western iGaming market. It will continue to communicate its core principle of “growing with partners” and hopes to light up a bright future with its worldwide partners.

hen it comes to industry suppliers, innovation right now needs to be all about taking the lessons learned from the last few months and putting it into building a pandemic-proof portfolio, says Aiste Garneviciene, COO at BetGames.TV. We’re not out of the woods yet when it comes to COVID, and while sports betting may be returning – I expect players’ approach to gaming to continue in the same trend that we’ve seen recently. Players right now want content that offers extended entertainment. Suppliers need to be offering products that offer a lower spend with far more regular play – without emptying wallets in a matter of hours. Games orientated towards betting on live outcomes, such as the live dealer proposition, have also far outperformed RNG-based betting gaming, such as slots. The fact that our games intrinsically attract a lower spend with far more regular play (as well as lending themselves to the fixed odds outcome format), has ensured that we have been very popular with sportsbook customers over the past few months. Looking ahead - key now for suppliers should be low spend, high engagement – and extended playing sessions that can sit alongside a regular stream of sport. Games that offer operators that all valuable retention factor in between matches without draining balances are going to be a winning strategy this year. Diversification is also going to be essential moving forward. Pre-pandemic, we’d expect to see operators focusing up to 70 percent of their efforts on sports and nothing else. As betting habits have shown, there also needs to be far more focus on alternatives beyond just RNG-based gaming. Most sportsbook players that have been converted to casino have proven unaccustomed to riding their luck on algorithms. As a result, live-betting products have proven to be a winning strategy, and anyone looking to engage and attract new players during the months ahead would do well to take note.

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 40 Ceuta

Up and coming igaming jurisdiction

he Autonomous City of Ceuta has positioned itself as a low tax location within the European Union, integrated in general Spanish law. It has a very favourable framework of regulations within the Union, compensated with a system of Rules of Origin which are a link to Community Markets. The recent tax measures approved, especially affecting gaming regulations, are truly favourable for the Autonomous City of Ceuta, allowing it to compete on a level playing field with other low tax territories in Europe, without the inconveniences of the territories classed as Tax Havens. This significant tax reduction in gaming, a substantial reduction of Corporation Tax together with an indirect tax called IPSI (which is similar to VAT but has much lower rates), means that Ceuta has currently become a significant attraction pole of businesses, additionally

boosted by its unique location, good climate and the fact that it is a cultural melting pot. The likely exit of the United Kingdom from the European Union is raising doubts in the industry on the potential disappearance of many of the advantages situating Gibraltar as a leader in online gaming in Europe, and hundreds of British companies have spent months planning a move to other territories. Ceuta has become a stable and up-andcoming attraction pole, additionally favoured by the full applicability of the legal system of the European Union, offering a greater degree of legal and financial security, as well as the fully applicability of the tax transparency treaties in agreement with the regulations of the OECD and G20 against tax evasion. There are 24 iGaming companies that have already moved to the City of Ceuta and are profiting from the tax advantages. Enrique

Reyes, Director of the Tax Service Office of Ceuta, has recently stated in an interview that the online gambling sector will create more than 250 jobs in Ceuta during Q4 2020 and Q1 2021. In order to promote the advantages of Ceuta for the online gambling industry, the local Government has created an independent and non-profit association, iGaming Ceuta - igamingceuta.com -. Both Operators and Suppliers can address themselves to iGaming Ceuta to gather more information about the taxation system and other benefits for their companies and employees.

fantastic range of products and services. By moving their brand online with us, new partners can be assured that we will meet their needs, help take any risk out of the equation and deliver a fantastic solution. We’ll enable them to protect and also grow revenues, providing a great unified customer experience via web, mobile and retail channels- for existing and new customers.” As well as an award-winning sportsbook,

available as a managed service if required, Digitain offers a great range of over 4000 casino and live dealer games, provided by some of the best suppliers in the iGaming industry. Digitain’s platform also offers a comprehensive range of Skill and quick-play Bet-On games, as well as multiple payment options and marketing tools – to deliver a one-stop-shop solution to any business looking to take their betting and gaming brand digital.

Digitain

“Let’s Get Digital”

ounded in 1999, Digitain’s brand has continued to expand and now serves a growing roster of global betting and gaming partners in both regulated and international markets. Digitain has more than 1,700 employees and provides in-venue betting solutions to more than 400 retail betting shops. September sees the launch of Digitain’s new marketing campaign; Let’s Get Digital, where the company is focusing on encouraging landbased operators to join with Digitain to take their existing brand online. Lilit Azatyan, Digitain’s Head of B2B Marketing is excited by this campaign. “Our multi-channel iGaming platform, along with Digitain’s experienced team of experts, offers new partners a quick, affordable and secure route to taking your brand online. In these challenging times, it can only make sense to provide your existing customers - whether casino or sports betting – with additional channels to allow continual access to your services and to mitigate the potential risk to your brand through further lockdowns. Digitain offers an affordable, trusted and effective solution – a one-stop-shop providing a quick and flexible casino and sportsbook software solution, enabling new partners to expand their business model and to offer their customers, old and new, a modern iGaming platform with a

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 41 Cloudbet

Cloudbet takes a spin with Authentic Gaming

loudbet has announced a new partnership with Authentic Gaming, the specialist roulette provider, renowned for tables live-streamed straight from the floors of historic casinos, including Bad Homburg, the birthplace of single-zero roulette. The live offerings are among 16 Authentic Gaming products unveiled by the pioneering

crypto operator, and include the provider’s state-of-the-art Live Arena Studio with 24/7 Roulette, Grand Roulette and its unique flagship product, Blaze Roulette. Based in Malta, Authentic Gaming was acquired by the Genting Group late last year. The new portfolio significantly amplifies what’s on offer at Cloudbet for players seeking the thrill of online roulette from the comfort of their homes or on the go, and adds to the swathe of new features the crypto casino and sportsbook has introduced since it relaunched its website in late April. Founded in 2013, Cloudbet is one of the world’s longest established bitcoin operators. “Our prime objective is to help customers take their gaming experience to the next level,” a Cloudbet spokesperson said. “That’s why we’re constantly looking for new ways to upgrade our product, and this partnership

is a prime example of that.” The operator also launched Cloudbet Live Auto Roulette, a bespoke creation by Authentic Gaming that carries the provider’s signature “Bets on Stats” feature. This is the first time that Cloudbet is attaching its name - and its reputation as a highly trusted crypto-gaming site - to a casino table. Cloudbet grabbed the attention of industry observers in June with an ambitious English Premier League campaign, under which its sportsbook charged no margin on prematch bets for the remainder of the season. That allowed customers to access the fairest prices -- and therefore the highest returns -- in the market. The campaign was an extension of Cloudbet’s long-standing “best odds” campaigns on sports including soccer, basketball and tennis.

everi

Blending old and new payment methods

espite a seemingly rapid shift towards digital payments methods outside of the casino industry, cash is not going anywhere. Cash is often the preferred method of funding for many reasons; It can be easier to use cash for sheer convenience, older gamblers may be wary of digital payment methods, and avoiding credit can help patrons stay within budget means. But unlike the retail sector, where going cashless at the coffee shop has a level of complexity, deployment of a digital payment solution in a sophisticated integrated casino resort requires a need to address the regulatory requirements from both a payments and gaming perspective. Regardless of the source of funding, a foundation based upon convenience, accessibility, usability, security and enhanced trust needs to be established. Leveraging industry expertise on payments in gaming and strategic relationships with social gaming payments partners, Everi’s omni-channel CashClub Wallet will both integrate and extend payments throughout the gaming enterprise using traditional, alternative and mobile technologies, producing expected increased funds to the floor and an enhanced, streamlined guest experience. The infrastructure of the Wallet is designed to be the hub of all payments within the gaming enterprise.

The gaming industry has cash access as part of the desired experience – not just a retail payment transaction. Compounded with legacy systems, gaming and payments regulations, and limited players who understand the unique nature of payments in the gaming space – Everi eliminates significant challenges to help casinos transform today’s gaming ecosystems into a digital one. Everi allows easy and secure self-service loading and unloading of value, transaction history and more. Funding can occur with a player card and PIN or mobile access, providing expanded choices for casino patrons with access via a self-service kiosk, cashier’s cage or with mobile application. Everi has succeeded in developing financial technology and services to the casino industry. By working across all channels, enabling card and mobile scenarios, being agnostic in third party integrations, and leveraging their extensive FinTech/Loyalty product line, Everi brings a superior set of solutions to their customer base. The introduction of mobile wallet technology represents an opportunity to deliver a fuller spectrum of digital services via the mobile channel. Everi’s CashClub Wallet will extend this influence, delivering more services and driving additional value into the patron’s hands

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 42 G&D Currency

Automation is key

he corona pandemic poses new challenges to our daily lives and our health. In addition to the challenges, the crisis also has enormous implications for the global economy. Cost control and reduction and efficiency gains are required across all industries. Within the entire cash cycle intelligent automation is one of the key success factors for safe and efficient handling of cash.

G+D Currency Technology has a wide range of banknote processing systems and solutions to cater to different casino requirements based on volume, currencies, policy and procedures. Our high-speed, advanced sensor technology, modular and scalable banknote processing system - BPS M5 and BPS C5 - with dedicated casino count room software BPS Connect Casino, can be customized to the specific needs

and requirements for the casino count room. BPS Connect Casino has built-in interfaces to all relevant components. Reports are generated directly and also have connectivity to the customer casino accounting system. In addition, the NotaTracc loading module for automated feeding of banknotes into BPS systems assures less human contact points to cash. Banknotes can be processed efficiently and cost-effectively at cage windows with desktop systems – BPS C2, BPS C1 and BPS B1. Consistently high throughput of 1,050 banknotes per minute ensures superior productivity, while best-in-class sensors combine peak performance with a high level of ﬂexibility. The efﬁciencies achieved with integrated automation solutions improve counting processes and time, and are more secure and accurate. G+D partners with our customers in this challenging time and continues to provide technical support. Most importantly, we truly understand the casino’s specific operation and needs, and provide the best solution.

frequent, but higher paying. Offering an action-packed armoury of more than 130 slots, table and video poker games, we’ve also signed a raft of deals in recent weeks with the likes of Marathonbet and RushStreet, enabling an ever-greater legion of fans across the globe to enjoy our titles. Boasting some of the industry’s most talented

designers, developers and mathematicians, we’ve quickly become one of the industry’s leading suppliers of slots and table games with good reason. Proud of our hard-earned reputation for great products and a world-class back office, along with our unique trademarked jackpot system, we’re looking forward to plenty more new announcements to come.

habanero

Underwater adventure

hile sports may have come back this summer – it’s fair to say these months haven’t been an ordinary period! Much of the industry’s focus has been on engagement and retention, with slot developers focusing hard on retaining the sports bettors and land-based players who switched to online casinos during the pause on live fixtures. Whatever your strategy for a potential crosssell, however, one thing remains clear: to retain newly migrated customers, you have to offer them the right content. That means providing premium quality gaming experiences that go beyond the recycled themes that continue to flood today’s slot market. Cue Habanero’s latest immersive release, Jellyfish Flow. Filled with underwater wonders, the slot can expect to find pulsating wilds in the form of jellyfish, which expand the reels by 1 for each that appears on the screen all the way up to 7x7. Boasting a huge 823,543 ways to win, it’s a luminous aquatic adventure not to be missed. In a proud first, we also launched our new optional ‘Ultra Mode’ feature with the game, giving players a chance to really dive into a high-stakes underwater escapade. With up to 9x more volatility, it offers wins that are less

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 43 Jade Entertainment

Growth and diversification during COVID

n battling the impact of the Covid-19 outbreak, Jade is adjusting to the new normal because failing to respond fast could result in great losses. Put succinctly, in the face of a pandemic, business model innovation is unavoidable. At its simplest, a business model is the way a person or a company creates, delivers and captures value. Jade for many years has been a gaming products distributor and service provider with a pan Asian presence. The only option was to stretch our creativity beyond the normal and grow beyond our traditional geographical and product boundaries. In recent months, Jade has expanded its product portfolio to include artificial intelligence software from nQube and thermal access control and media management from Outabox. Our suppliers, such as Novomatic, NRT, Sega Sammy, Synergy Blue, Game Code, Advanced Gaming and Walker Digital have all taken this time to focus on R&D and we can

expect to have exceptional new products and games post Covid. Jade has also diversified into sports betting and Jade Sportsbet will recommence operations with the opening of the Manila casinos. We will also be taking our retail Sportsbet product into new jurisdictions which will be announced soon. We expect that the convergence of brick and mortar and internet gaming is imminent and Jade is preparing a large number of services within this area. The virus may have also given us the rare opportunity to reflect and introspect, which could have been difficult in the usual pace of business. Pisano said that these days of the lockdown have been one of the busiest periods of his life, the number of decisions to be taken on a daily basis have increased exponentially during this time of lockdown. Diversification and innovation will be key to Jadeâ&#x20AC;&#x2122;s growth.

JCM

TITA Silver increases transaction options

ITA Silver brings the functionality of an ATM and a redemption kiosk to table games. TITA Silver provides three key benefits to operators: increasing transaction options; reducing contact points, fills, and lines; and giving operators increased oversight with

live transaction management. TITA Silver brings players more transaction options directly at the table game. Table games equipped with TITA Silver enable players to buy-in with a debit card POS transaction at the table, buy-in with a TITO

ticket at the table, or convert chips to TITO tickets before leaving the table. Players can use TITO tickets they received from other areas of the casino and can also redeem promotional vouchers. Options to add bulk note bill validation and cashless card transfers are also available. TITA Silver reduces contact points by keeping the chips at the table game and limiting the movement of chips around the casino. Fills are reduced because the chips do not need to leave the table. Lines at the casino cage are decreased because the player can convert their chips to TITO tickets and cash out a TITO ticket at the redemption kiosk. Centrally managed with the ART Server package, TITA Silver enables operators to monitor live table game transaction activity with real-time data. Statistical performance dashboards are configurable and give operators an abundance of easy-to-read data. Financial reporting enables reduced fills and drops at the table games and audit capabilities for the contents inside the drop box. TITA Silver is also integrated with more than 60 systems and has remote configuration and remote software update capabilities, all of which give operators greater control and increased efficiencies.

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 44 Pinnacle

Danish lottery deal

eptember has been a big month for Pinnacle Solution in terms of both product and business development. Esports has been able to thrive despite the impact of Covid-19, and the industry has been even more interested in exploring the benefits that esports betting has to offer. Given that Pinnacle Solution is the gold standard of esports suppliers, as proven by its multiaward winning credentials, there has been an influx in interest from operators looking to add a high quality esports product to

their portfolio. This has culminated in the announcement of the Danish national lottery provider Danske Spil signing with Pinnacle Solution to enhance their esports offering. Broadening its growth beyond Asia and into the European market highlights the calibre of the Pinnacle Solution offering, with even more major deals expected soon. Pinnacle Solution has also used the last few months to develop its product and bring something new to the table for existing

clients. The launch of Euro View is another landmark for Pinnacle Solution as it marks a brand new UI that has been made available to clients. The simplified navigation with ability to search makes markets easier to find for customers, as well as an added favourites feature for personalisation. Work has also been done to improve the method of listing markets and optimise the user experience to help clients generate more revenue. Jane Guan, Pinnacle CCO, commented on the B2B activity in recent months; “The Pinnacle Solution team have worked tirelessly throughout 2020. While there has been a lot of uncertainty in the air, we are proud to have delivered on our goals so far. It’s nice to reflect on success but our focus is solely on continuing to improve our product and build upon the impressive results we deliver to clients.”

PlaynGo

More entertainment. In One GO

et “More Entertainment. In One GO” from suppliers Play’n GO as they give not only more games, but more value in those games as they endeavour to create new ways to reach the market and their audiences. Their latest innovation is the upcoming September release of a collection of three new titles that, although they can be played alone, work together to bring a more rounded game experience to players. The games, Celebration of Wealth, Beast of Wealth and Temple of Wealth all come together to create The Wealth Series, one big bundle of entertainment! The titles centre around the idea of wealth, prosperity and good fortune and each game is a 5x3 video slot, based on a different theme. They all have their own free spin feature, each one giving a different experience. All three titles share an exciting progressive jackpot feature. Throughout the game, a portion of each player’s stake is split between four different pots Grand, Major, Minor and Mini. Once the jackpot is triggered, it activates a click and pick feature, and whichever pots the player picks they win. Having already built themselves up to be a leading supplier in the industry, Play’n GO continue to refresh and reframe their offerings to the market, keeping themselves

Asia Gaming Briefings | September 2020

ahead of the game. Alongside this new Wealth Series, September also sees the release of the eagerly anticipated Golden Ticket 2, a sequel to their 2014 hit slot, already expected to be

a popular release in multiple territories. The year is inching towards its end but Play’n GO shows no signs of slowing down, with plenty to look forward to on the horizon.

SUPPLIER SPECIAL REPORT 45 Sega Sammy

Volcanic eruptions

EGA SAMMY CREATION INC., a Japan-based company established in 2013, is a member of SEGA SAMMY Group, consisting of 64 companies including SEGA, a global leader in entertainment and video game development, and Sammy, Asia’s leading creator of interactive Pachislot and Pachinko machines. Utilizing these diverse resources from the group, we manufacture exciting never-beforeseen gaming machines. Our latest Linked Jackpot series “Volcano Link” kicks off with two titles, “Pride of Lion” and “Lucky Dolphin”. The most exciting bonus round in the series is the “Volcano Bonus feature” where each Volcano symbol appearing on the reels awards a jackpot, bonus award or credit prize. This feature fully utilizes both main and top game screens and is made up of exciting volcanic eruptions animations and sounds! This game series delivers unstoppable excitement and a captivating game experience for players! “In the face of uncertainty surrounding COVID-19, SEGA SAMMY CREATION is dedicated to stay connected with our customers to provide support.”, said Masahiro Kurosaki, Managing Director at SEGA SAMMY CREATION. “It’s still unclear when our life goes back to normal and people can freely travel again as well. However, we are committed to supporting our global customers to overcome these difficult times. Furthermore, we will continue to gather and utilize feedback from our casino operator customers in the continuing development of our slot games that closely meet their player needs.”

Scientific Games

Introducing GM Atlas and ShuffleStar Continuous

M Atlas, Scientific Games’ next-level progressive platform, ties together all of the best functions from the previous Game Manager 1 and Game Manager 2 platforms and adds much more. GM Atlas supports linked progressive jackpot pools, multiple jackpot levels, and Must-Hit-By bonuses for more exciting player experiences. This system features a convenient and easy-to-use dashboard, one-click navigation to various reports and other helpful tools, and a robust offering of live information. It simplifies sign integration to promote table game jackpot meters property-wide to boost marketing efforts. GM Atlas operates on the upgraded NXS Command II table game hardware, which is compatible with multiple bet device options and includes an updated dealer terminal and a new 24” vertical progressive display. Operators can still have their favorite game titles and more with the GM Atlas progressive platform. The ShuffleStar Continuous Shuffler is the only continuous shuffler available on the market with card recognition, including monitoring cards being inserted and dealt from the unit, and reporting real-time card inventory. This technology safeguards against card counting and tracking, and increases hands per hour by up to twenty percent. To further enhance game security and efficiency, the ShuffleStar is the first continuous shuffler to detect card feeding errors, and reject cards being fed incorrectly. Featuring an increased deck capacity of up to eight decks, the ShuffleStar provides casino operators with ultimate deck integrity and uninterrupted play, without downtime for loading a shoe or shuffling cards. Additionally, the ShuffleStar features a powered dealing mechanism that contains a revolutionary flat card dealing shoe, with a sleek flush mount, low profile design for improved ergonomics. This greatly enhances the dealer experience by improving lines of sight, and reducing fatigue or strain.

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 46 SimplePlay

Different games and new features

implePlay, one of the fastest growing slot providers, has been eager to provide its clients with different games and new features added to its lobby. SimplePlay has released a number of titles recently, including “Three Musketeers”, a game based on the King’s Musketeers of 17th-century France; “Bomber Squad”, featuring two robbers breaking into a vault for gold; “Mystical Lamp”, where the famous Genie of the Lamp fulfils every wish! These titles come with different ways to play and various Free Game Features from picking lamps to win free spins, to locking a specific reel with an extra reel stop. The innovation and diligence of SimplePlay are not limited to game titles. They have added several features to make its lobby more appealing and user-friendly. The first one is the ranking system. Players can check the ranking of SimplePlay’s games in terms of jackpot sizes and biggest single game win across the platform. The performance of every game can be accessed, attracting players to spin more so clients can enjoy a greater turnover! Then there is Split Mode for its Slot Games. At SimplePlay’s lobby, players can find the Split

Mode buttons, allowing players to operate up to 4 Slot Games in one window. Players can freely add the games they would like to play and close games individually. With players having fun at different games simultaneously, Split Mode will create a lot more turnover! The third one is a feature for operators. Free

Spin Offer allows operators to set up customised events using SimplePlay’s back office system. Operators can give out free spins to their players for marketing purposes and to create more opportunities! This is a ready-to-launch feature at SimplePlay! Please expect more fun and innovation from SimplePlay!

Synectics

Surveillance: casinos’ secret weapon in tackling Covid-19

stimates suggest global casino GGR will be down significantly in 2020 and full recovery may take years to reach 2019 levels. In pursuit of reassuring players, casinos are seeking efficient ways to entice people back. What’s more, they need to do so in a way that safeguards customers and demonstrates public health and safety compliance, all while local regulatory requirements linked to

Asia Gaming Briefings | September 2020

COVID-19 continue to evolve. Video surveillance solutions are ideally positioned to support this operational challenge and with an open architecture platform combined with integrations to best of breed solutions, this can be accomplished. As an example, through Synergy 3, system dashboards can display the number of people

entering and exiting a property, regardless of how many entry points there are, for a realtime gaming floor capacity status. The system automatically alerts if a maximum threshold is close to being (or has been) breached. Operators can also apply this capability to specific areas within the casino; i.e. slots, to ensure maximum occupancy thresholds are not exceeded. Likewise, if the system detects that the number of people is approaching maximum limits, Synergy 3 can trigger a workflow to immediately alert and deploy security personnel to disperse people from the area. Similarly, facial recognition systems – commonly used for identifying high rollers or problematic gamblers – can be re-purposed for contact tracing. Analytic integrations within Synergy 3 provides the ability to do just that. If a casino learns a visitor has tested positive for COVID-19, operators can rapidly filter video footage to find the individual, and then automate their search to review any scenes where the person appears in to see where they went, and with whom they came in contact with.

SUPPLIER SPECIAL REPORT 47 SUZOHAPP

Adapting without losing sight of the goal

he beginning of 2020 started with so much promise. At SUZOHAPP, we had many plans for what was to be a great year of change and development. Following a few years of acquisitions and product development, 2020 was going to be the time for us to refine our focus on our core customers by bringing our customer experience and product offering to the next level. We had a terrific show at ICE London and were very excited for what the future held. Then everything changed when the pandemic shut down the world. Suddenly a singular focus emerged, like tunnel vision with a forward light. That goal was simple. Survive. We stopped all travel, created hyper-vigilant sanitizing procedures for our operating facilities, shifted to remote work and looked at how to cut costs. Like most companies, we had some difficulty navigating the tumult that was the ever-changing guidelines as information about how to deal with the virus emerged. We were very fortunate, however. With a warehouse facility in China serving our Asia-Pacific customers, we learned best practices early and were able to implement them quickly to our global warehouses. Our lean team worked hard to get whatever business we could in the door. But we quickly learned that our traditional ways of working would not get us through these uncertain times. We had to figure out how to shift our mentality to adapt and change quickly while staying true

to our brand, our goals and strategies, and our people. Often, the trouble with trying to be an “adaptable” company is that there is a fine line between simply being a reactive organization and being flexible with your plans but still retaining your company mission. Once the dust settled, and we realized that the “new normal” of the pandemic was going to be around for a while, we determined that to survive past the pandemic we’d have to continue our plan to refocus on our core customers but we’d have to navigate a constantly moving line to get there. In that light, SUZOHAPP is more committed to serving our core customers than ever before. We know that our strength lies in our expertise of over 30 years in the business and our breadth of partnerships with suppliers and manufacturers. These strengths will help us continue to move forward. Though we have weathered what we hope is the worst of this storm, we know many companies, smaller manufacturers and suppliers specifically, were not so lucky. These closures have had a profound affect on our industry as they supply many OEMs and operators with their products. To fill this need, SUZOHAPP will be working with our engineers and network of suppliers to do all we can to source quality replacements for these key items to ensure our industry will not fall behind in production or innovation. Additionally, we have launched the Personal Protection Line— a collection of

relevant anti-viral products sourced by our team of experts who know what makes sense for the gaming industry and where the pain points are. But like everything these days, we know these plans will likely change as our environment shifts around us. We want you to know that even as plans change, our focus will not stray. We are here to listen to your needs and to your feedback and help find a solution together. We continue to want to be your partner throughout this and simplify your sourcing so you can put your time and energy back into your company mission and spend a little less time adapting.

SportCaller

Free-to-Play growth leader

he past 12 months has seen Free-to-Play grow and adapt as a genre, staking strong claims to becoming an industry vertical in its own right. This dynamic shift in status was highlighted in the Investor Presentation for the recently completed Flutter Entertainment / The Stars Group merger, where FTP was listed as one of six key product tent-poles (alongside more mature industry perennials such as Sports Betting, Casino and Fantasy). As the market leader in the sector, SportCaller’s growth over the last year has eloquently

demonstrated the strategic significance of FTP. We’ve launched a combined total of 44 new games, marking a step change on the 22 games rolled out across the previous three years. In this spell, we also doubled our active clients, emphasizing the fact that not only are more operators pressing FTP into service, but they are also finding more varied ways for it to be deployed. Accordingly, we now offer over 90 games across 37 countries and in 20 languages. The past year has seen us firmly establish a presence in the US, releasing 18 new games for five clients - including the likes

of market-leading operator FanDuel and CBS, the top-ranked TV network. FanDuel are a great example of the flexibility and strengths in FTP, releasing 15 games with SportCaller in just 18 months (including five games for the new NFL season) with a flair to innovate, evolve and refine their approach. Indeed, the Flutter Group’s recent interim results underlined this point, revealing that FanDuel had ‘kept customers engaged with innovative content [during the shutdown]’. FTP customers doubled on the prior year in Q2, while active customers remained impressively robust between NBA suspending and MLB starting at 75 percent of 2019’s engagement figures. SportCaller recently retained its crown for Best Acquisition & Retention Partner at the EGR B2B 2020 Awards, cementing its position at the forefront of this progressive FTP vertical.

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 48 Tangam

Optimising floor operations

hen the pandemic hit, the gaming industry was particularly vulnerable as it’s based on tourism, entertainment and human interaction. Everything began to shut down worldwide with many furloughed workers. We were in uncharted territory with numerous unknowns. As a software company that analyzes a lot of casino data, Tangam Systems had many conversations about the current shutdown and reopening plans with various stakeholders. We realized that many would, in essence, just turn the lights back on and resume operations. The problem with this approach is that with safety guidelines including less capacity, unknown demand and potentially more labor, it could really hurt operators’ bottom-line. Optimizing floor operations was crucial. To help with casino reopenings and operating in a ‘new normal’ during the pandemic, Tangam launched the Bouncing Back from COVID-19 Webinar Series. It focused on actionable, low effort, high return strategies to hit the ground running once a property reopens and begins to operate under new safety guidelines.

The webinars: 1. Learnings from Macau, Optimal Staffing & Game-Mix - creating a successful reopening strategy with an emphasis on optimizing labor costs while maximizing revenues 2. Optimizing Operational Procedures for Baccarat & Roulette - low cost, high return strategies to optimize operating procedures for Baccarat and Roulette. 3. Table Games Strategic Yielding Levers - Combining Operational Expertise with Data - an open discussion with a panel of industry experts on how

they marry their operational expertise with data to manage their table games business 4. Tangam Reopening Best Practices - best practices on how to design an open hour, game-mix and pricing strategy using TYM (Tangam’s flagship software) for a successful casino reopening. Tangam Systems, a global leader in table games optimization, is trusted by some of the largest casinos to maximize profit and improve patron experience for over 7,000 tables in 9 countries. All of these webinars received overwhelmingly positive feedback and are still available at www. TangamSystems.com to view.

Transact

Epicentral keeps your players safe and expands revenue

asinos are working hard to adhere to the new health guidelines, so it is crucial to have products that support social distancing and sanitation. However, we understand that it can be challenging to avoid crowding when there are long lines of players at the rewards kiosk. Alternatively, with resorts limiting guest capacity, it is more important than ever to maximize the plays taking place. Thankfully, TransAct’s Epicentral 4.0 is a multifaceted solution that tackles both issues. Epicentral is the only promotional software suite in the industry that essentially transforms every slot machine into a kiosk by targeting customers in real-time with unique, custom-designed coupons. Because Epicentral pushes promotions directly to guests at the slot machine, this ensures that players are safely distanced on the slot floor with no need to wait in line at the kiosk to redeem their awards. The software system is an ideal solution because it extends timeon-device, increases player spend, and generates customer loyalty – all leading to more proceeds for casinos. As a result, guests are kept socially distanced and casino floors increase their earnings in the safest way possible. Additionally, version 4.0 offers a sleek interface and a variety of new and improved features strategically designed for operators to grow their proceeds while using the most effective and user-friendly software. Epicentral 4.0 is also web-based, which makes it easier to install, update, and keep secure.

Asia Gaming Briefings | September 2020

SUPPLIER SPECIAL REPORT 49 W2

Improving efficiency and easing onboarding

2 is a provider of KYC, AML, and fraud prevention software solutions based in Newport, Wales. Since 2011 we have been changing the game by taking the focus from the check, to the technology that supports it and improving ease and efficiency of the onboarding journey for a multitude of industries. The last few months have been transformative for W2. With a global lockdown halting operations for most businesses globally, W2 has continued to thrive by developing a core group of products through innovative advancements and putting the focus solely on improving the efficiency and ease of the

onboarding journey. W2 understands that customers and companies are completely different in their need for regulator y compliance; our agile products and services satisfy that need. Complexity should never be a barrier to business, so it is the W2 mission to make the complex simple by adapting its platform to ensure all services can be consumed easily via a single API. W2 have added extra suppliers and streamlined the process with the development and introduction of new innovative services and functionality such as our ‘bundle builder’, which allows clients to make sure their services are customisable,

robust and adaptable in order to meet their individual needs. From clients that use PEP’s and Sanctions checks to those investing in Document and facial recognition to streamline the onboarding process, W2 has seen advances and adoption across all our sectors including but not limited to financial services, gaming, cryptocurrency, FX, and beyond. The future looks bright for W2, with a committed and talented team surrounding CEO Warren Russell and CCO Sara West, we are on a journey to providing the best regulatory compliance solution in the market, and are constantly working towards true customer satisfaction.

YGAM

YGAM and Betknowmore promote safer gambling

he Young Gamers & Gamblers Education Trust (YGAM) and Betknowmore UK have joined forces to launch Safer Gambling Training, a purposeful new programme to provide gambling industry employees with specialist online training to strengthen play protection standards and effectively safeguard consumers from gambling-related harm. The resources have been developed using a methodology known as ‘flipped learning’ derived from Neuroscience studies on how the brain learns. The collaboration combines specialist knowledge, lived experience insight and research to create what is believed to be the most advanced and comprehensive training programmes globally. Six interactive digital training modules have been released which cover key topics including customer vulnerability, safeguarding, customer interaction, identifying harm and employee mental health and well-being. The training content is all relevant to the Gambling Commissions latest LCCP requirements and has received funding from regulatory settlements to support the delivery of the National Strategy to Reduce Gambling-related Harms. The Canada-based Responsible Gambling Council (RGC) is also involved in the alliance acting as independent evaluation partners. Lee Willows, Chief Executive of YGAM said “Our journey with Betknowmore UK has been humbling. Together we have been fortunate to work with a number of operators to deliver face-to-face training over the last twelve months

and so having a strategic alliance to continue this and combine with digital learning seems a good natural progression. Player protection and understanding customer vulnerability is an area we know operators want to upskill their staff in.” Frankie Graham, Chief Executive of

Betknowmore said: “Companies operating in the gambling space require trained employees providing consistent, high level and trusted customer service. Our aim with this new training programme is to help raise standards and create a benchmark of knowledge and understanding of gambling-related harm.

Asia Gaming Briefings | September 2020

INDUSTRY OPINION 50

Sudhir H. Kalé*

Clouds gather for U.S. operators in Macau The COVID-19 pandemic has taken a huge toll on casino revenues in Macau with U.S. operators such as Wynn Resorts and Las Vegas Sands bleeding more than $2 million a day in the 2020 second quarter.

o make matters worse, President Trump’s spats with China continue on multiple fronts such as the “China virus”, tariffs, Chinese expansion in the South China Sea and allegations of spying. The latest salvos fired by the Trump administration are the banning of TikTok and prohibiting U.S. citizens and companies from using WeChat in their business dealings. Over 90 percent of communication that Macau casinos have with their customers in the Mainland is carried out using WeChat. The three U.S. operators in Macau could therefore face a serious competitive disadvantage in marketing to their customers. Long term, all concessions in Macau come up for renewal in 2022, and the actions of the U.S. government could also adversely impact the prospects of concession renewal for the U.S. operators.

Asia Gaming Briefings | September 2020

As all industry observers no doubt realize, it is not legal to market the casino product in China. Advertising of casinos or even visiting clients with the intent of getting them to gamble in casinos carry stiff penalties—a hard lesson learned by Crown Resorts of Australia in 2016. Consequently, most communication with potential customers in the Mainland on the part of the six casino operators in Macau is conducted through the medium of WeChat. WeChat, better known by its Chinese name “Weixin,” has become the medium of choice for both casino operators and customers. Facebook and Instagram are pretty much banned. The danger and uncertainty surrounding COVID-19— not to mention the regulations on either side of the Macau-China border—have kept loyal customers away. Also, the Chinese government’s clampdown on online

INDUSTRY OPINION 51

gaming to stop capital outflows is having a negative impact on liquidity in Macau’s VIP sector. Lam Kai Kuong, director of the Macau Junket Association has been quoted as saying, “It (the clampdown) definitely impacts liquidity.” Mr. Lam went on to suggest that the VIP industry may never return to revenue levels from two years ago unless China changes its stance toward VIP gambling in Macau. Needless to say, casino operators in Macau are not happy with Trump’s executive order on WeChat. Wynn Macau warned that such a ban could “adversely affect our ability to communicate with certain of our customers.” David Sisk, Melco Resort and Entertainment’s COO called the ban a “silly thing” for U.S. president Donald Trump to propose. Mr. Sisk went on to say, “They (casino staff) check up on our customers via WeChat. People send videos, they send voicemails – everything is pretty much done through WeChat. All your social media, everything comes through it. I mean, I think there is no way you’d ever exist without it here.” Could this confluence of events be the beginning of the end of the munificent business environment the three U.S. operators have basked in for over fifteen years? During this period, each operator has shown deference to

policy makers in Macau as well as China and steered clear of any contentious issues. However, the coinciding of a worldwide pandemic and deteriorating Sino-U.S. relations may have contributed to a perfect storm, something the casino operators simply cannot control. The market potential for Macau does not appear as bright as we have gotten used to. For one, China’s economic growth rate, predicted to be the lowest in 30 years even before the pandemic, may result in less working capital for junkets and less disposable income for players in the “mass” and “premium mass” segments. Second, the Macau casino industry will face increasingly stiff competition from jurisdictions such as the Philippines, Vietnam, and Cambodia where the lower gaming taxes allow for higher player reinvestment. Third, tightening of regulations by Mainland authorities to control the flight of Renminbi will considerably reduce the amount available to Chinese residents for gambling in Macau. With the business environment in Macau getting tougher, and Japan losing its luster for the main U.S. casino operators, the future will probably not be as rosy as it has been in the past 15 years. Casino concessions come up for renewal in 2022. Some analysts predict that the souring of relations between China and the

United States will negatively impact the renewal chances of the three U.S. operators in Macau. Macau has been a magical success for American casino operators for quite some time, and almost an overnight success at that. Who could forget the opening of Sands Macao on May 18, 2004 on the Macau Peninsula? it cost a “puny” $240 million dollars to build and returned its investment in under 12 months. It would be imprudent to suggest that the next fifteen years will be as fecund for U.S. casino operators in Macau as the first 15 years have been. All indications point toward strong headwinds, with the ban on WeChat being but one nonisolated gust. However, when it comes to pinning down the prospects of U.S. casinos in Macau, whichever side you bet on, it is still a gamble. As the Danish nuclear scientist Neils Bohr famously said, “Prediction is very difficult, especially when the future is concerned”. *Sudhir H. Kalé, Ph.D., is Founder and Principal of GamePlan Consultants, a boutique consultancy that has advised casino clients on five continents. He has lectured and written extensively on the right reopening strategies for gaming businesses amid COVID-19. You can contact Sudhir at skale@gameplanconsultants.com.

Asia Gaming Briefings | September 2020

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Asia Gaming Briefings | September 2020

LAST WORD 54

Is it time to rethink shutdowns? Sharon Singleton

Managing Editor, AGB

Eight months into the Covid-19 crisis and it’s starting to feel a bit like a game of whack-a-mole as reinfections continue to resurface around the world.

opes for a V-shaped recovery are fading the international business any time soon with New fast as properties remain closed, or Zealand’s borders likely to remain shut for all of 2021. Similarly Australia, which had a good track record have been forced to shut their doors again due to new outbreaks. The hits to early on, put the state of Victoria on full lockdown the economy and bottom line keep on coming and again, complete with a nighttime curfew after new consumer demand is softening as jobs evaporate and cases were recorded. That shut down Crown Resort’s Crown Melbourne property for at least six weeks. the uncertainty about the future continues. Thailand had been considering opening up to In China for example, manufacturing production has returned to almost normal levels, though the tourism in select locations from October, but that consumer sector continues to struggle as people plan is now on likely to be put on hold after the first tighten the purse strings. Total Chinese spending on locally transmitted case in more than three months was discovered. imports of goods and services Similarly Vietnam, which in the second quarter was about also appeared to have the $530 billion, far short of the situation under control, has $606 billion in the same period The International closed down its Danang area a year earlier. Labour Organisation after a resurgence there. Asia’s mega-wealthy still The list goes on. South have cash to spend, though in April estimated Korea won widespread praise according to investment bank that the crisis had for its handling of the crisis DBS, they are keeping their in the early days, but has had powder dry to take advantage put some 15.3 several resurgences. Paradise of opportunities in financial million tourism Co.’s Paradise City was forced markets and private equity to close after cases amongst once the pandemic subsides. jobs at risk across staff, while Kangwon Land None of this makes pretty the Asia Pacific has repeatedly extended its reading for IR operators and closure to Sept. 21. raises the question of how region. It would be irresponsible long disease control measures to suggest governments throw can shut down economies and caution to the wind and declare peoples’ livelihoods? In Europe, governments appear to be taking a vastly different business as usual, though if new cases are mushrooming approach and whilst not a free-for-all as in the U.S., seemingly out of the blue after months of being in borders are mostly open and tourism has resumed. the clear, there perhaps needs to be a rethink about Outside of Macau, SkyCity Entertainment was the how to handle the crisis. The International Labour Organisation in April first to reopen its doors and had reported unexpectedly healthy demand. However, with more than 100 days estimated that the crisis had put some 15.3 million without a single case, an outbreak was reported in tourism jobs at risk across the Asia Pacific region. In Auckland and the city and casino were shut down addition, it points out that three in four workers are in informal positions, making them particularly vulnerable. again for a further two weeks. If we’re not careful the ongoing economic pain will As for international travel, the operators’ management has said they don’t expect a return of be felt long after the pandemic has passed.

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Asia Gaming Briefings | September 2020

AGBriefings September 2020 Edition

Articles inside

LAST WORD

INDUSTRY OPINION

SUPPLIER SPECIAL REPORT

NEW ZEALAND

AUSTRALIA

PHILIPPINES

MALAYSIA

FOCUS

JAPAN

South Korea

MACAU

MOVING OFF THE SIDELINES