Casino & Gaming International: Issue 16 by Casino & Gaming International

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Casino & Gaming International

2009 ISSUE 3

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WELCOME

INESCAPABLE LOGIC OF eGAMING Publisher Jamie Kean Email: jamie.kean@casinoandgaming.net Editor Stephen Lawton Email: stephen.lawton@casinoandgaming.net Publishing Services Manager Louisa Bull Email: louisa.bull@casinoandgaming.net Distribution Manager Tracie Birch Email: tracie.birch@casinoandgaming.net Business Development Manager Stuart Jameson Email: stuart.jameson@casinoandgaming.net Advertising Mike McGlynn, Sales Director Email: mike.mcglynn@casinoandgaming.net Ray Blunt, Sales Manager Email: ray.blunt@casinoandgaming.net

Woodland Place, Hurricane Way Wickford Business Park, Wickford Essex SS11 8YB. United Kingdom Telephone: +44 (0)1268 766 515 Facsimile: +44 (0)1268 766 516 Annual Subscription (4 issues): £107 United Kingdom £117 Europe & Middle East £127 USA & Canada £137 Rest of the World Please make cheques payable to ‘CGI’ and send to: Casino & Gaming International, Subscriptions Dept., Woodland Place, Hurricane Way, Wickford Business Park, Wickford, Essex SS11 8YB. United Kingdom. Photography © 2009 Casino & Gaming International Limited and it’s licensors. All rights reserved. © 2009 Casino & Gaming International Limited (except where otherwise stated). All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written permission of Casino & Gaming International Limited. ISBN 190200335 7 www.casinoandgaming.net

oldman Sachs weighed in to suggest that online poker will eventually be legalised in the US and that appropriately resourced companies – including particularly Partygaming, 888, Playtech and Bwin – could accrue significant market share. Had that come from any other investment house circumspection would be the natural response in today’s economic climate, but while that hoped for change is not a revelatory finding in any case, it does indicate that persistent high profile debate and intervention – that government, operators and players would all benefit from regulation – surely cannot be resisted for too much longer. But it isn’t just a matter of time as to when the US Administration will replace the UIGEA ban on Internet gambling with regulation: In many respects it is the implications of an uneven, piecemeal consideration of legalising online poker that is underway in several states; an uncertainty about achieving a level competitive playing field for non-US operators especially at this time; the impact of a concerted casino group entry to the online market with its strong client and financial base; and the increasingly dominant role that big media entertainment reach may be slowly securing. And that does not hinge on the US position alone; EU regulation is also fraught and problematic despite some incremental advances. There is a legitimate worry that with such trends emerging, there will likely be stronger government concern to ensure not only the source of tax income that will be generated by significant growth in revenues, but to stringently control the process itself. Liberalisation has certainly reconfigured free market opportunities for gaming in many locations, but a resurgent government monopolisation through national operators is not out of the question. It is understandable, therefore, that there would be some disquiet about the survivability of a number of gaming companies confronted with such a prospect. Nevertheless, all of this is as much part and parcel of mergers, demergers and restructuring as it is about forming alliances and partnerships for mutual assistance. And with many lucrative markets in various stages of expansion beyond North America, there is a far from written-in-stone set of permutations to all of these issues with which to juggle. But as with everything in international business and trade, it is always subject to shifts in economic priorities. Hence, as this economic downturn has taken its toll, more sectional, regionalised approaches to developing markets have begun to surface – not for the first time. Even so, that tends to place an onus on the operator to come up with the best of everything to win in tough conditions. As casino developments have broadened their scope of operations and revenue reliance, there has been a sense among traditionalists you might say that the core rationale for gambling – and its one-time solid all-weather draw – was being undermined by non-gaming’s greater ‘mainstream’ risk and susceptibility in a downturn. Typically applying to Las Vegas, at any rate the change was inevitable and is here to stay worldwide. Now, where land-based operators are taking up the reins of interactive, online and mobile elements, that perhaps represents one way to recapture or renew a sense of the ‘historic’ or ‘pure’ purpose in gambling for a modern, tech savvy generation. Until very recently major casino resort operators have kept egaming’s potential at arms length. There is not just cautious recognition of its possibilities, but the serious beginnings of a move to harness its value. Harrah’s Interactive Entertainment in Montreal is the first major land-based operation to seriously engage the online future, probably since MGM’s aborted web-based foray via the Isle of Man almost exactly seven years ago. This has to be, in the longer term, a significant spur to pushing new boundaries assuming the right expertise is in place to advance the bottom line. Any commercial observer of the way electronic and technological factors govern so much of work, life and leisure will conclude that the only way for gaming businesses to survive is to be up front in the product innovation and market entry loop. Live Dealer gaming, for instance, which provides a fascinating example of an interactive connection and bridge between the tangible and the virtual; between a fixed location and being anywhere; while multiplayer is the most recent expression of a trend to being part of gaming networks, creating a semblance of the broader community and remoteness that combines with social visibility. Clearly, eGaming has an inescapable and unstoppable logic. CGI

Stephen Lawton is Editor of Casino & Gaming Internatonal

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CONTENTS

FEATURES 9

HOW CULTURE, IDEAS AND DELIVERY OVERCOME TOUGH COMPETITION BY ED WILMS

DIFFICULT PLAY: HARNESSING THE AESTHETICS AND SCIENCE OF ILLUMINATION JON CHAMPELLI AND GEORGE HUANG IN CONVERSATION

SOPHISTICATED SAFEGUARDS - FOR VISITORS, EMPLOYEES AND ASSETS BY RAYMOND WEIJT

MACAU PROVIDES AN EXCEPTIONAL TEST OF TOMORROW’S TECHNOLOGY TODAY BY KONRAD HECHTBAUER

ONE STEP AHEAD: MAKING THE MOVE TO IP VIDEO BY OLIVER VELLACOTT

ACHIEVING COMPLIANCE OBJECTIVES BY PROTECTING BRAND AND PROFITS BY KENNETH RIJOCK

OPTION THINKING: KEEPING NIMBLE IS CENTRAL TO eGAMING SUCCESS BY CHRIS GLEDHILL

NEW BEHAVIOUR TRACKING INSIGHTS LEAVE NOTHING TO CHANCE BY DAVID EXCELL AND BILL FITZGERALD Casino & Gaming International I 3

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CONTENTS

FEATURES 69

DETERRENCE AND MANAGEMENT: FRAUD, RISK AND RECESSION BY ANDRÉ EDELBROCK

STOCK TAKE: OPPORTUNITIES TO ADDRESS AN INCREASINGLY LARGE BASKET OF TRICKY QUESTIONS BY CLIVE HAWKSWOOD

ARE WE HEADING IN THE RIGHT DIRECTION?

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MELANIE ELLIS

PROPELLING GROWTH: MASS GLOBAL MARKET PENETRATION GATHERS MOMENTUM INTERVIEW WITH MATTI ZINDER

IS FREEZING ONLINE POKER PLAYER PAYOUTS A NEW OFFENSIVE? BY JIM TABILIO & MELANIE BRENNER

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THE IMPLICATIONS OF REAL-TIME BEHAVIOURAL TRACKING BY MARK GRIFFITHS

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CASINO DESIGN

HOW CULTURE, IDEAS AND DELIVERY OVERCOME TOUGH COMPETITION BY ED WILMS

Native American Tribal-based casino design, considering its relative youth, has become a force to reckon with, especially as many are reaching destination standards today. The rich range of architectural and design possibilities they provide is a source of both new project development and fresh thinking with a green and sustainable emphasis that is fast becoming the norm.

asino design has changed dramatically in the last 20 years, and perhaps no sector has been as greatly affected as Tribal Gaming. Native American Casinos have become increasingly more savvy and sophisticated, and in many ways they are leading the way for casino operators across the country and around the world. Contributing to this rapid change are several factors including the coming of age of their initial gaming properties, an increased awareness of competition and market niche, and the rise of sustainable architecture and green initiatives. In the 21 years since President Reagan signed the Indian Gaming Regulatory Act (IGRA), Indian Gaming has grown from $100 million in annual revenue into a $25.7 billion business. With this tremendous increase in volume has come the understanding that the level of service, the quality of the amenities and the aesthetics of tribal properties has to compete for every disposable dollar. Our current economic climate offers a unique opportunity for native casinos to capture new business. Las Vegas has seen over 16 consecutive months of declining revenue. Consumers feeling the economic pinch at home are choosing not to travel, business meetings are being held by teleconference or locally, and when these consumers choose to game they are looking toward regional and tribal casinos to take the place of the bright lights of Las Vegas. Many of the original tribal gaming properties are reaching the end of their useful life. Sprung structures, butler buildings and enlarged bingo halls are now becoming destination resorts in their own right. The sweet spot for this kind of facility improvement seems to be properties that are 8-10 years old. Economic development boards charged with running these properties recognise the need to position themselves for years

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CASINO DESIGN

of economic growth and secure a market position that will allow them to expand to meet the needs of future generations. In short – these properties have grown into full fledged destination resorts. Seizing this opportunity almost four years ago, The Grand Traverse Band of Ottawa and Chippewa Indians (GTB) located near Traverse City, Michigan, held a competition to reposition their gaming property, Turtle Creek Casino. We successfully secured this work in the face of some outstanding competition. The strength of our original design concept was evident in the final design solution, most likely due to the fact that we fully immersed ourselves in their culture, listened to their ideas and respectfully incorporated them into our winning design solution. Grand Traverse was operating two facilities, and both of them were very regional and successfully appealed to a distinct target audience. They fit comfortably into the northern Michigan landscape – and it was exactly what people expected and nothing more. Turtle Creek had the look of a north woods lodge, in a northern mid-western state, offering slots machines and table games, but beyond that, the level of service dropped off dramatically. No hotel accommodations on site, a food and beverage programme that was not only a loss leader, but may have actually become a barrier to their success. Not being able to capture that food and beverage dollar meant that their guests were going off property. With no hotel component, the facility largely relegated it to a local casino – and precluded extended play. It certainly made it harder for their high rollers to spend multiple days on property. The Grand Traverse Band knew that competition from 10 I Casino & Gaming International

neighbouring facilities was growing; in fact, major additions were planned at their nearest competitor that would have a significant impact on their public perception. It was decided that they needed a facility that rivaled Las Vegas in terms of its type of offerings, level of aesthetic quality and sophistication. The direction from the Tribe was to create a facility that set them apart from their neighbours and give them a competitive advantage. It was important to position them for continued growth and ensured that future generations would have a facility that could be expanded easily. It was time for a change and the tribe insisted that it not be overtly Native American themed and it should absolutely not be another North Woods Lodge. Contemporary casino design is about far more than laying out a slots parlour. Design professionals wanting to deliver a successful project must understand a multitude of project types in addition to the gaming floor. These include hospitality design, restaurants, retail shops, office and industrial uses. From the design side, it takes a team of experts to understand the complexities of the programme. National rating organisations such as Michelin and AAA have rating systems – 3 stars, 4 stars and so on – that detail specific amenities of the guestroom and hotel services. Having experienced hotel designers on your team will save time and effort because the level of service to be provided will greatly affect everything from onsite laundry facilities down to the size of closets and the number of hangers. Retail designers need to understand store layout, merchandising and theft concerns. Restaurant designers need to know how to create dining rooms that feel full on the slowest night and how to efficiently get food and equipment from the loading dock to the kitchen and onto the guest’s plate. There are large office components to casinos including the executive office suite, conference rooms, human resource offices, training rooms, cafeterias, hotel administration, guest services and areas for state regulatory officials. Layering these divergent programmes together is challenging enough, but the effort can be even more complex when repositioning an existing native casino. With any revenue generating enterprise, maintaining that revenue stream during a renovation is paramount. As experienced designers, we know that the design, programming and sequencing of construction for the new facility is developed around minimising gaming floor down time and enhancing guest experience. At a Native American Facility, construction experience and politics can also be something to consider. Often times, this is the first project of significant size for the tribe, and certainly their largest investment to date. Tribal council can be divided about an expansion or a new facility. There can be questions such as: How much money to spend? How big should the project be? Should we build new or remodel? When is the right time to build? And what should it look like? We have been through this process many times and we know that it’s critical to build consensus among the council, and assure them that once they are able to answer these questions, we’ll deliver the right design, on time and on budget. Being able to address these issues early on, and move forward with confidence is critical to success. Without obtaining the complete support of the council, the whole process is likely to be derailed. Maintaining momentum was critical at Turtle Creek, and politics was one of the reasons that the steel was ordered and

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CASINO DESIGN

>> OUR CURRENT ECONOMIC CLIMATE OFFERS A UNIQUE OPPORTUNITY FOR NATIVE CASINOS TO CAPTURE NEW BUSINESS. LAS VEGAS HAS SEEN OVER 16 CONSECUTIVE MONTHS OF DECLINING REVENUE. CONSUMERS FEELING THE ECONOMIC PINCH AT HOME ARE CHOOSING NOT TO TRAVEL, BUSINESS MEETINGS ARE BEING HELD BY TELECONFERENCE OR LOCALLY, AND WHEN THESE CONSUMERS CHOOSE TO GAME THEY ARE LOOKING TOWARD REGIONAL AND TRIBAL CASINOS TO TAKE THE PLACE OF THE BRIGHT LIGHTS OF LAS VEGAS. >> erected so early in the process. Once committed, our clients knew that the project would move forward, even if the tribal leadership changed midway through the process. We’ve seen projects stall during contentious tribal elections that have turn-over of half the tribal council or more. This is exactly what happened during the course of our planning. It takes time and special effort to carefully bring the new council members up to date on the project’s process and more importantly let them understand that they can still positively affect the outcome of the project. This is especially true if they ran on a platform in opposition to the casino. Gaining the confidence and trust of the entire council is one of the reasons we’ve been able to succeed where other design firms have fallen short. Armed with that information, our design team went about creating a facility that completely changed Turtle Creek from a small local casino nestled in a valley of northern Michigan’s rolling hills into a destination driven, casino resort hotel. Everything about the design needed to reinforce the idea that this was a world class facility. We positioned the project higher on the hill giving to give us two advantages. We achieved greater presence and visibility from a major state highway and we were able to maintain continuous operations in the existing casino. Utilising the sloping site, we layered the building’s programme along a main circulation path linking two entry plazas. The lower plaza became a grand entry experience for gaming patrons leading to a 68,000 SF gaming floor with 1,500 slot machines, high stakes poker room, black jack and other table games. The building itself was inspired by northern Michigan’s sloping shoreline, rising out of the waters of Lake Michigan. The bow-tie shaped gaming floor offers a dynamic range of intimacy levels and public openness allowing players to tailor their own experience. The building circulation follows the slope and crests at the lobby for a 137-room hotel tower with views toward Traverse Bay. The sloping site also inspired the design to have multiple levels and entry locations. As a resort destination, guests can arrive for meetings, banquets and wedding receptions without going through the gaming floor. However, circulation routes and views continue to drive guests to the machines, but always allowing for choice about the kind of experience you wish to have. Pathways or cuts that are expressed in the form of the building as well as the circulation route were layered over and throughout the project organising arrival sequences for the guests starting from the landscaped plazas, leading through 68,000 sq ft of gaming and entertainment, 26,000 sq ft of food venues, 5,000 sq ft of retail, 10,000 sq ft of conference, 96,000 sq ft hotel and 2,000 SF of cultural venues supported by staff in a 12,000 sq ft workspace. These pathways utilise glass skylights and windows connecting the inside to the

landscape and sky, allowing light and views throughout the facility. These cuts contrast with the mass of the building’s dark earthy colouring, with patterned reflective stainless steel surfaces that dynamically change the presence of the building throughout the day. The lighting strategy recalls the beautiful northern Michigan environment, utilising LED lighting to dramatically change the personality of the gaming floor to convey cool blues, spring greens, warm reds and harvest yellows that are constantly shifting to provide an experience that engages guests and is relevant to the local landscape. LED’s, while having a higher first installation cost, are far more cost effective over the life of a property and offer an incredible amount of flexibility that would be burdensome with more conventional lighting strategies. We also integrated cultural ideas into abstract geometries that offer unique environments but that also tieback to tribal culture, making it personal for the guests and the operator. The building itself and the patterning in the outdoor plaza recall the turtle shell, offering shelter and connection to the land. Luxurious sapelle wood panels lining the gaming floor are patterned with cuts and reveals that are an abstraction of the tall thin river birch trees so common in this area. Frosted and etched glass recall Michigan’s changing seasonal landscape and provide containment and respite, but still allow for visual connections to the gaming floor and the action. Natural daylight and an emotional connection to the Earth are also directly linked to this facility. We have found that guests are more comfortable and stay longer in an environment that is in tune with the movements of the sun and changing of seasons. Human comfort is of paramount concern when trying to maximise time on property. The central spine linking the gaming floor to the hotel also allows filtered daylight to modulate the environment. Daylight studies were done early on to minimise any glare on gaming machines, allow security cameras to function effectively and perhaps most importantly provide the opportunity to minimise operational costs by reducing the level of artificial lighting. There is also a pressurised access floor to deliver a low flow air displacement system that effectively mitigates the smell of smoke and other contaminants. Tempered air delivered at the floor with little or no velocity increases the comfort of the patrons. As the natural convection occurs, contaminates are pulled directly to the ceiling away from the guests – having many patrons not even realising that smoking is still allowed on the gaming floor. The food and beverage service was significantly improved offering options that range from a 24 hour deli, to a sumptuous buffet and finally Bourbons72, a fine dining Casino & Gaming International I 11

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restaurant that offers the finest cuisine in the area. In addition to upgrading the physical appearance of these facilities, it was equally important that the chefs, wait staff and hosts were re trained to better service the guests. The varying levels of finishes and services that are part of this integrated food services offers real choice and the kind of experience that rivals any Las Vegas casino. The Grand Traverse Band also made a commitment early on to green initiatives. We led the ownership through a sustainability charrette at our office that identified shortcomings of the existing facility, including operational efficiency and maintenance concerns. It also laid out expectations for the new facility and offered key suggestions about how to achieve them. Geothermal mechanical systems, day lighting and green roofs were all reviewed. In the end we were able to incorporate natural lighting and planted roofs into an integrated mechanical system that offered very high efficiency and operational ease. As part of our professional commitment to sustainable architecture, we have honed our library of materials in our office to include only items that meet third party standards of certification. Our specifications are also carefully written to require sustainable practices from general contractors and sub consultants. Minimising waste and diverting construction materials from landfills is a crucial part of our documentation. Sustainable practices and design ideas are becoming a driving force for many facilities as Native American tribes, in particular, have a deep and profound relationship to the earth and environmental causes. Time to market is also a consideration. With our competitors getting closer to their opening day, it became imperative that our project start as soon as possible and finish on time and on budget. Implementing fast track delivery allowed us to take advantage of the regional economics and buy our materials at the best possible price, ultimately delivering a higher value for the money. It also created much needed momentum as the design and building process for a facility this size is measured in years. Every month shaved off the overall schedule will bring revenue right to the bottom line. Smart planning and flexibility is the key to working in this type of scenario. But maintaining this level of focus throughout a project can be difficult and time consuming, but creating a culture where this can thrive is part of our DNA. Working closely with the owner and construction team we guided this project from conception to opening day, navigating multiple voices from the owner, tribal politics and a fast track construction schedule. Because of our strong initial ideas and confidence from the tribe, we were able to order and erect steel on site long before the construction documents were finished. Patrons of the current facility were able to see immediate progress on the construction of a facility that was unique in the landscape and perhaps the most unique building in Michigan. At $85m and 336,000 SF Turtle Creek Casino and Hotel is uniquely positioned to meet the challenge of greater sophistication in casino design and provide a platform for future growth. Master planning for this site also includes gaming expansion, more then doubling the hotel key count, larger event facilities and structured parking. The tribe has also acquired adjacent properties to allow for the full development of additional retail and entertainment opportunities. In conjunction with their other properties they offer three world 12 I Casino & Gaming International

class golf courses, indoor and outdoor tennis courts, day spas and boutique retail. The Grand Traverse tribe has clearly understood how to drive traffic to their facilities and keep them there. Turtle Creek Casino and Hotel is a prototype for a new kind of Native American Casino. It’s one that appeals to a vast spectrum of guests and offers world class amenities in a unique setting. Taking advantage of the natural landscape, it’s proximity to Lake Michigan and the abundance of tourism opportunities, it appeals to local gamers and travelers alike. We see much more of this kind of development ahead. Creating facilities that weave tribal culture and history together in a way is not overtly referential, but informs the shape, aesthetics and guest experience in a broad way. Destination resorts facilities that reposition properties at the end of their useful life is the future of Indian Gaming. It is one largest and best mechanisms to help tribes increase competition and garner a larger percentage of gaming and non-gaming revenue. CGI

* The 2008 Global Gaming Exposition (G2E) recognised Walsh, Bishop, The Grand Traverse Tribe and PCL Construction Services for creating and delivering the ‘Best Architectural Design for a Casino Resort Under $200 Million’. The competition for this award is full of incredible design work, and vision by the best architects and interior designers in the world. We were greatly humbled to receive this international award. As part of the same conference, we were awarded ‘2008 Architectural Firm of the Year’.

ED WILMS Ed Wilms, AIA is Vice President & Design Principal at Walsh Bishop Associates. For the past 18 years, Ed’s practice has focused on restaurant/hospitality, retail and entertainment destinations. Working with both national operators and local entrepreneurs, he is adept at delivering physical environments that match the client’s vision. Engaging in a highly collaborative design process drawing specialised knowledge and insight out of each participant, his work delivers solutions that require the negotiation of complex programmatic elements and cultural ideas - creating buildings and spaces that maintain their relevance over time. Some of his most recent work includes the Sands Casino and Resort | Bethlehem, Bethlehem, PA, Black Bear Casino Resort, Carlton, MN, and Turtle Creek Casino and Hotel in Williamsburg, MI. ed.wilms@walshbishop.com

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CASINO DESIGN

DIFFICULT PLAY: HARNESSING THE AESTHETICS AND SCIENCE OF ILLUMINATION JON CHAMPELLI AND GEORGE HUANG IN CONVERSATION

The best in the art and engineering of lighting design results from a combination of tensions that include the pure sense of subjective effects, problematic legal requirements of energy conservation and the operators’ bottom line. As the present slowdown has affected the pace of casino resort and hospitality development, the lull offers a moment to reflect upon how Las Vegas is shaping up in this innovative field of design.

ecession or no recession, there is still a lot going on in Las Vegas. We have recently seen the expansion of the Wynn empire with Encore, and the reinvention of the Aladdin as Planet Hollywood. Palazzo, the first LEED certified casino resort in Las Vegas, opened in 2008, soon to be followed by fellow LEED projects City Center and Fontainebleau. We have been working on the Fontainebleau for more than three years and with the project slowed temporarily, we thought it might be the perfect opportunity to get their impressions of the impact of LEED project certification and the ever-tightening energy codes on Las Vegas design.

JC: Due to its sheer size, there are several design firms involved in the design of the Fontainebleau in Las Vegas, and we are responsible for a significant portion of the lighting of the project: the casino and high limit gaming spaces including the centre bar, wine bar, race and sports book with associated deli, buffet, coffee shop, convention and meeting spaces, retail corridor and public restrooms. Whatever the coming weeks and months have in store, we believe that the project will be extremely successful once it makes it to opening and the public finally gets inside, but it has certainly been an interesting journey… Fontainebleau decided to go for LEED certification several months after the design process had begun, so we went through a period of analysis during which we helped to educate the owners about the impact that conformance to the ASHRAE code would have on the project. We knew at the outset that Wynn's Encore would be opening before us near the Fontainebleau site on The Strip. Our main concern was how the LEED energy requirements Casino & Gaming International I 17

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would affect the overall aesthetic when compared to casino/resorts that were not saddled with the same restrictions. We also knew that there were very significant financial incentives coming from the state if the project was LEED certified, and that compliance was essentially a fait accompli. We would have to rethink the design in LEED terms. Fontainebleau is a massive high-end hospitality project presenting difficult design challenges due to the LEED energy codes. City Center, another LEED project at the opposite end of the strip, is very much in the same situation. These projects have run head-first into a truly awful economy. A lot of hard decisions are being made, and designers who were previously focused primarily on aesthetics with respect to the power density bottom-line now need to re-think their approach. Our response has been to carefully review our designs with an eye toward which elements were most critical in terms of visual impact, and then fight hard to keep them. The goal of a successful, beautiful project is one shared by the entire design, construction, and ownership team, and our role is to help them make the right choices. GH: Yes, making all the right choices is indeed difficult. Fontainebleau, like many new Las Vegas mega resorts, is on the right track to think in terms of energy conservation. Energy conservation can be the owners’ best friend; it keeps the property operating efficiently, which helps the bottom line. However, energy conservation requirements should be measured in and take account of all project types, but the sad reality is that some building types have fallen through the cracks in many, if not all, energy codes. 18 I Casino & Gaming International

For years, many states did not have an energy code. In recent years, energy codes such as ASHARE/IESNA 90.1 and IECC have been adopted by many states and local jurisdictions. Southern Nevada first adopted the IECC 2003 in October of 2005. It was a huge wake-up call to the lighting industry here in Las Vegas, since the energy code didn’t even mention casinos. Considering that casinos are the predominant industry here, it was pretty shocking. Without casinos, Las Vegas would be a desert out in the middle of nowhere instead of a booming and vibrant city that is the number one tourist destination in the world. Since the IECC did not have a category for casinos to comply with, designers and engineers had to settle for the next closest building or area type. The problem with that was that casinos then had to fit into a set of parameters that just did not apply. For example, would one think that the grand lobby of the Wynn resort casino would have the same level and quality of lighting as the lobby of a low-end budget motel? Most of us would think not. However, under the IECC, it made no difference. A lobby was a lobby. Furthermore, the IECC made no exceptions for areas that have high ceilings. It is not uncommon for casino resorts to have a 50-foot high grand lobby ceiling, or, in the case of the Fontainebleau, a 125-foot high convention lobby ceiling. The code does not differentiate between a lobby with a 10foot high ceiling and one that is 12 times as high. Both lobbies get the stingy 1.1 watts per square foot regardless. It is essentially impossible to achieve the same foot-candle values, using the same amount of power, when the ceiling height difference is a factor of 2, 3, 4...10 fold. This is a serious flaw in the energy code. There are also many other

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holes in the code that need to be addressed, but I will leave that for another discussion. Being one of the few professional lighting design firms in Las Vegas, we spearheaded the challenge to bring awareness to the attention of the law makers. At first it felt like the battle of David and Goliath, us vs. the State of Nevada: It was difficult just to figure out the right people to talk to and then get them to listen. Many thought that we wouldn’t succeed and should just give up but we persisted. It was a long and arduous process that spanned a period of almost one year. Luckily, we had the help of Bill Hornbuckle, President and COO of Mandalay Bay Resorts, and Ben Mammina, senior vice president of construction at MGM MIRAGE, who supported us along the way. Mandalay Bay Strip Steak was one of the very first casino property projects to ever face IECC 2003. We were also very fortunate that the Southern Nevada Building Officials and the Nevada State Energy Expert consultants were all very willing to listen to our challenges and recognise the shortcomings in the IECC. I was called to help write the lighting portions of the local amendments for the IECC 2006. The amendments passed unanimously and were adopted as our current code of law. A lighting disaster was temporarily avoided. However, about every three years, the amendment process starts all over again. We are now facing a new IECC 2009 that is more stringent than the previous two IECC codes. Furthermore, it comes with a mandate that it must not be less stringent. Las Vegas casinos, once again, are in danger of losing their lustre. JC: Lighting design is a combination of art and science. A lighting designer must understand the sciences of

photometry and colour theory, how the human eye works and how it works with the brain, must understand voltage drop and ballast power factors and many other complicated things. It’s safe to say that good science is critical to good lighting. Unfortunately, good science, or rather, science for the good, is threatening to do considerable harm to the art of lighting. Even though ‘good’ lighting is rather subjective, it is still quite possible to learn to identify, and then to design ‘appropriate’ lighting given a set of objectives. Here in the US we look to the Illuminating Engineering Society of North America (IESNA) to develop and then publish guidelines to assist young lighting designers and engineers in their efforts to learn what the ‘appropriate’ lighting, or the ‘right’ lighting, might look like for a given venue. Good lighting for high-end hospitality projects depends on the use of layers of illumination. Because hospitality projects are normally 24/7 operations, having layers of light that react and adjust to the time of day or use of the venue is imperative. High-end hospitality must convey a sense of luxury through finishes, furnishings, and lighting. This sense of luxury is conveyed in most Las Vegas casino resorts throughout the property, from the moment of arrival. Even the restrooms in Vegas casinos have chandeliers in them…and wall sconces…and cove lighting. That’s not to say that all restrooms should have such accoutrement, certainly not. A restroom in a school, or a hospital, or a McDonalds, does not need a chandelier, it simply wouldn’t be appropriate. There would be no aesthetic contribution because the fixture would seem out of place, even ironic. But in Las Vegas, it works…and is at times even necessary. Casino & Gaming International I 19

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Because in Las Vegas, design is marketing; design is reputation. When you walk into a Las Vegas casino resort, you step into an alternate reality. That’s what people love about Las Vegas and that’s why slogans like ‘What happens in Vegas, stays in Vegas’ work so well. Visitors want to come to Las Vegas to experience something that they cannot experience at home. Restrooms with chandeliers…In a city billed and marketed as excessive, it is counterproductive to force designers into spartan or utilitarian designs. Eyecandy is the centre bar (nightclub, really) we opened last year at Mandalay Bay. As you can see in the photo on page 14, there is quite a bit going on. There are crystal chandeliers, downlights over the bar to ensure our 50 footcandles comply with the health code, decorative pendants over the bar counter and LED light strip under the bar counter to illuminate the wood of the bar die. Halogen track lighting washes the stacked stone behind the bar above the glowing bottle display shelves. In the distance are the 5-foot tall glowing private booths with sheers illuminated by RGB LED fixtures around each VIP ‘pod’. Is all of this lighting absolutely necessary for safety, or security, or pure function? No. But should a Las Vegas lighting designer be forced to strip away the layers of visual wonder in the heart of a place as captivating as Mandalay Bay? Again, no. GH: Jon makes a good point: Lighting is one of the most important, high-impact elements in a casino, even above architecture and interior finishes, in my humble opinion. You get more visual ‘bang for your buck’ per dollar than anything else you can put into the project. We human beings do not see objects. We see the light reflected from the objects, such as the marbleised caramel-coloured stone floors, the rich mahogany wood wall panels, the red flowing carpets, the soft brown leather-wrapped chairs, and the reflective metallic 20 I Casino & Gaming International

ceiling panels. Without light, we do not see colour, materials, shadows, textures, and all the intricacies that we often take for granted. If a high end casino resort barely has enough allotted energy to afford the functional lighting for the space, how is there going to be enough for lighting that brings out the ornate architecture or accentuate the beautiful interiors? Lighting for visual stimulation is often the casualty of the inadequate code regulations. The millions upon millions of dollars that Casino owners and operators spent on themeing all melt away. Many energy codes around the country exempt lighting for theme elements for theme/amusement parks, but not for casinos. Casinos truly are theme/amusement parks for adults. The theme elements within a theme/amusement park are part of a complete guest experience. The decorative elements in casinos on the Las Vegas Strip rival those of Disney World, Universal Studios, and the like. If theme elements within a casino are part of a complete guest experience, then why are casinos being left out in the dark? I have had the good fortune of spending my entire professional career predominately on theme park design and casino design. I have worked on literal theme parks such as Universal Studios, Walt Disney, and LEGOLAND, as well as richly themed resorts like London Clubs International’s Casino at the Empire, Argosy Casino Riverside, and Fontainebleau Las Vegas. My intimate involvement with highend theme entertainment architecture has shown me that lighting is so much more than most people give it credit for. JC: Nevertheless, we are big believers in the need for energy conservation, and live that belief every single day. We are visited daily by lighting manufacturers and their representatives, every one of them bringing the Next Big Thing. We review and critique everything and anything we can get our hands on. Our sister company is currently engaged in the green renovation of a number of Las Vegas residences, working to address multiple problems facing our city simultaneously by creating jobs for laid-off contractors renovating foreclosed homes that are sitting empty, driving the market for green-building products. We’ll be installing geothermal heat pumps, photovoltaics, solar water heaters, low-VOC finishes, Energy Star appliances, new windows and doors, the works. We truly do understand the critical role that green building practices must and should have in the future of the architectural design industry, even while fighting to keep some types of projects from being destructively restricted. The technology simply isn’t ready to allow the kind of freedom we need as casino designers while adhering to strict codes. Now, we use a lot of LED fixtures…a lot. But only when appropriate. LEDs have come an incredibly long way in a few years, from a novelty act to an absolute staple. They’re a wonderful light source for many applications, yet still inappropriate for many others. Unfortunately, even the extremely low wattages made possible by LED fixtures solves neither the problem created by the need for layered lighting, nor the disconnect between the science of lighting efficiency and the demands of lighting aesthetics. GH: As professional lighting designers and LEED Accredited Professionals, we understand the need to be green and have

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been practicing green design, sustainable design, energy efficient design, or whatever we choose to call it, long before they became popular catch phrases. Back then, it was simply good design practice that any lighting professional considers out of the many design criteria that must be taken under consideration. We simply believe that the pendulum has swung too far as so many folks jump on the bandwagon. Most do so for honourable reasons, but some purely for the prestige, financial benefits, and bragging rights at the expense of other factors. We would like to speak as a moderate voice to fight for the art of lighting design so it is not lost and discounted in the quest to be green. We believe that there is room for lighting to be green without sacrificing the art of lighting, but there must be reasonable laws and regulations. JC: Many, if not all energy codes, have an exemption for signage, because signage defines a business’s personality or theme, and signage is critical to a business’s economic success. The code writers believe that a business should not be restricted in the way it expresses itself in signage because it’s too important to the business’s survival. If a business wants to have hundreds of flashing bulbs, or dozens of rows of neon in order to define its character, they feel it should be allowed to do so. Retail lighting is another considerable challenge. While it may be possible to achieve the desired footcandle levels for a retail shop by using fluorescent troffers or metal halide downlights, the aesthetic needs of a retail shop inside a highend spa inside a casino resort are entirely different. Remove the pendants and the low-voltage track, as well as the adjustable AR111 downlights and the wall-mounted lights at the make-up mirrors from the Elizabeth Arden Red Door Spa at Harrah’s in Atlantic City. Replace it all with a utilitarian lighting scheme, designed with a low lighting power density as its primary goal, and you would no longer have a venue worthy of the brand. Additionally, most of the sources a lighting designer would turn to, fluorescent and metal halide in particular, do not offer a high level of colour rendering or ease of control. California’s super-strict Title24 energy code exempts the lighting of theme elements in theme parks. Of course it does. How could it not? Who wants to tell Tinkerbell that her castle is too sparkly? Who wants to be the one that removes 9 out of 10 light bulbs from the carousel they rode as a child, the one they remember like it was yesterday even if they haven’t seen it for a decade or more…surely there have to be some places that should be allowed to exist in a state of ridiculous excess, places that are a departure from everyday reality. Of course, and Las Vegas is one of those places. What is Las Vegas if not a theme park for adults? Southern California's dependence on theme parks for its economic health pales when compared to Las Vegas' dependence on its casino resorts. If Las Vegas casino resorts were to lose their international tourist draw due to over-regulation, the overall economy would suffer mightily. Unfortunately, it’s not always that easy. It becomes a problem of definition; a problem of where to draw the line. These are codes we’re talking about, after all…laws. How does one determine which projects depend upon design freedom for their very existence, and those for whom aesthetics were never top priority? We know the difference when we see it. We know upon entering a project for the

very first time whether the top priority was aesthetics, or budget, or speed. But how do we know before the project starts? Do we make the determination geographically, by exempting Las Vegas, but not Atlantic City, or Biloxi MS? By project size? By the number of tables or slots? These are tough questions. But they’re important questions, since the theme-park aspect that has been a part of the Las Vegas gaming experience throughout its history is being threatened – threatened by people with only the best of intentions, surely, but threatened none the less. I was with Cirque du Soleil as assistant lighting designer for the ‘O’ show many years ago, and in that time I saw the power of a truly unrestricted imagination. I saw art allowed to be whatever it wanted, and it was (and still is) beautiful. Who would think of putting wattage restrictions on Cirque du Soleil? The point is moot, as theatre lighting is exempted from the lighting codes. It is performance art and must be allowed to take whatever shape it desires. And what is Las Vegas? Las Vegas is performance, and Las Vegas is theatre. Everywhere you look. CGI

JON CHAMPELLI AND GEORGE HUANG

Jon Champelli, LC, MIES, LEED AP, received his MFA in Lighting Design and Technical Direction from Tulane University in 1996. His previous experience includes time with the Comedie Francaise in Paris, Flying by Foy and Fisher Technical Services in Las Vegas. Jon’s five years as a lighting designer and programmer for Cirque du Soleil’s ‘O’ brings a unique edge to architectural lighting design. With Steelman Partners since 1999, Jon was made President of shop12design upon its inception in 2007. Jon has been involved in domestic lighting projects for MGM, Harrah’s, Hard Rock and Mandalay Bay in addition to international work in Helsinki, Monaco, Macau (for the award-winning Las Venetian Sands) and many more. The Steelman family of companies is poised to expand with the creation of Jon’s newest venture, Hyperion Dynamic, an energy and sustainability consulting practice. George Huang, LC, LEED® AP, MIES, Associate IALD, has a Bachelors Degree in Architectural Engineering, Lighting/Electrical, from The Pennsylvania State University. He’s been a Lead Lighting Designer at Walt Disney Imagineering (WDI) and a Senior Lighting Designer at Gallegos Lighting Design in Los Angeles before joining Steelman Partners in November of 2005 and has been with shop12 design since its creation. George’s earlier projects include: Argosy Casino in Kansas City, Disney’s California Adventure, Disney’s Studio Paris, The Casino at the Empire Leicester Square in London and Strip Steak at Mandalay Bay. George serves on the Board of Managers of the local Illuminating Engineering Society in Las Vegas, and is an Adjunct Instructor of Interior Lighting Design at UNLV.

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Alfastreet Autumn Plans Last months have been very busy for Alfastreet. Despite the economic turn down that is affecting the gaming industry they are developing new products and working on the few markets that are still keeping the business alive. In the spring months all the action and shows were focused in Latinoamerica, where Alfastreet is a no 1 brand in the multiplayer business. After shows in Aruba, Bogota and Panama City in mid July the lights are on the new and emerging ELA show in Mexico City, Mexico. Regarding this show and future plans we have interviewed Matjaz Petek, Marketing and sales manager of Alfastreet. 1. What did you present on this year in ELA? New products, multi-players? This year we have brought the complete Alfastreet product range to the ELA show. We have presented the new Poker multi-player, a new Bingo multi-player, a Dice Game multi-player and a Sic-Bo multi-player. 2. What is the position of Alfastreet in the Mexican market? Alfastreet is the leading provider of multi-player gaming machines on the Mexican market and have made big investments in this market in the past years. Alfastreet machines have shown superior performance over the competition and together with the good technical support those are the winning cards of Alfastreet in Mexico. 3. Why did you choose Mexico to exhibit? Is this a good trade show? Mexican show is professionally organized and is becoming more and more important event on the calendar. The decision on coming to this show was not difficult then! 4. What are the plans for exhibiting during the rest of the year? The season of gaming shows in Europe is starting in September and Alfastreet is exhibiting on almost every show, so the autumn will be very busy for us. We are starting in Bucarest in late August, and we are exhibiting in Budapest, Sofia, Madrid, Prague, Bratislava and Warsaw. The culmination of the autumn shows is the G2e Las Vegas show, which is still a very important date on the calendar. 5. Did the economic turn-down affect Alfastreet performance on world markets? This year the performance of Alfastreet is very good and at the moment we are not particularly hurt by this very severe crisis. This crisis is hurting both, operators and manufacturers. Of course the soonest this crisis ends the better will be for the whole industry!

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SOPHISTICATED SAFEGUARDS - FOR VISITORS, EMPLOYEES AND ASSETS BY RAYMOND WEIJT

There is hardly a country in the developed world that does not have casinos. Since the fall of communism, even eastern Europe has a growing gambling industry, with countries like Russia, Poland, Hungary and Romania hosting a surprising number of attractive and successful casinos. All casinos share the same threats of theft, embezzlement and damage and require effective surveillance. The primary task of closed-circuit television (CCTV) surveillance in a casino is to protect its visitors, employees and assets; most establishments spare no expense in installing the most sophisticated CCTV systems available.

ompared with other buildings and complexes, casinos have unique security requirements. The combination of large crowds, huge amounts of cash on site and the threat of cheating and theft leads to a potentially volatile environment. Whether to prevent petty cheating, theft or organized crime by visitors or staff, the need for thorough and effective surveillance is a primary requirement. Surveillance acts first as a deterrent and secondly as a means of detection, apprehension and, ultimately, prosecution. Security staff have an important dual role here – a visible presence in the gaming areas and behind the scenes observing live and recorded video content to identify any suspicious activity. In addition, security personnel must be alert to the danger of fire, accidents, assault and the presence of underage visitors. In other words, they have a high level of responsibility, often in very crowded, smoky warm areas that mean tiring work. Without CCTV surveillance, their task would be almost impossible. Casinos range greatly in size – from relatively small facilities in a single, compact building right up to massive complexes that include shops, hotels with thousands of rooms, restaurants and vast entertainment arenas. The world’s largest gaming location is, of course, Las Vegas. Attracting more than 34 million visitors annually to its 75-plus casinos, the millions spent in Las Vegas on gambling and hotel accommodation is more than matched by the colossal investments made in them by owners and operators. In the UK a report some years ago by KPMG predicted that spending on gambling will be more than ?3.75bn in 2009. It’s clear then, why casino owners are willing to spend substantial amounts of money to protect their investments with state-ofthe-art CCTV surveillance.

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>> SOME COUNTRIES, INCLUDING THE US, HAVE MANDATORY REGULATIONS ON RECORDING SPEED OF VIDEO CONTENT IN CASINOS. IN THE US, THE MINIMUM REQUIRED RECORDING SPEED OF A SURVEILLANCE SYSTEM IS 20 FRAMES PER SECOND (FPS). ONLY DIGITAL TECHNOLOGY CAN ENABLE RECORDING AT THIS SPEED WITH THE DIGITAL VIDEO RECORDER (DVR), WHICH ALSO ALLOWS CONNECTION OF MULTIPLE CAMERAS. THERE CAN BE THOUSANDS OF CAMERAS IN A LARGE CASINO AND THE KEY WORD, THEREFORE, IS CAPACITY. >> DETECTION The CCTV chain begins with the camera. Numerous types of camera are available today with many impressive features. We offer a range of fixed, dome and pan/tilt/zoom (PTZ) models suitable for casinos. Especially applicable for low-light conditions often found in a casino, DinionXF cameras feature XF-Dynamic, which uses 15-bit digital signal processing (DSP) technology to capture the entire dynamic range of a scene. This means that activities in areas of bright lights or in dark shadows are captured effectively. Other features, many enabled by digital technology, further enhance basic camera functionality such as miniaturisation, motion detection, day/night operation, backlight compensation, dynamic noise reduction plus remote and automatic lens control. A wide range of accessories provides mounting choices, resistance to tampering, impact and hazardous substances. RECORDING AND PLAYBACK Some countries, including the US, have mandatory regulations on recording speed of video content in casinos. In

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the US, the minimum required recording speed of a surveillance system is 20 frames per second (fps). Only digital technology can enable recording at this speed with the digital video recorder (DVR), which also allows connection of multiple cameras. There can be thousands of cameras in a large casino and the key word, therefore, is capacity. The Divar XF H.264 Hybrid recorder offers new compression techniques based on the H.264 standard and with hard disk drive capacities of up to 4 TB, enough capacity for around 45 days of continuous recording in 4 CIF resolution for 16 channels. The Divar XF Hybrid Recorder also provides tamper-proof storage that answers the legal need for preventing image editing without being detected, and the provision of video evidence in a court of law. Moreover, combining the Divar XF Hybrid Recorder with RAID (redundant array of independent disks) systems ensures that no video is lost in the event of a single disk breaking down. IP-BASED SURVEILLANCE The industry trend of basing CCTV surveillance systems on Internet protocol (IP) is certainly extending to casinos. In many cases the building’s existing local area network (LAN), Internet or intranet can be used, adding surveillance capability for minimal cost. And where a LAN is not installed, new network cabling already costs less than coax. The benefits are many. At the camera level, the scalability of an IP-based system grows from a single camera to thousands in single unit increments, compared with 16camera/channel steps for DVR. In addition, any camera can be provided with any frame rate at any time, and frame rate and storage capacity can be increased simply by adding hard drives and PC servers. Moreover, IP allows ‘intelligent’ functionality of cameras, such as motion detection, sensor input, relay output and alarm triggering; faster systems integration allowing one network that controls audio, video and data; remote accessibility of live or stored video streams from any location, and increased reliability through real-time management software. Using Power-over-Ethernet (PoE) technology, the IP camera, or an encoder with attached analog camera, can also be powered over the network cable, providing a much easier installation. We also have a comprehensive range of IP encoders and decoders, including single- and multi-channel models, providing highest-quality video in 4CIF resolution and full frame rate, all whilst maintaining high efficiency of network usage. The functionality of these encoders is further enhanced with an advanced Intelligent Video Analysis (IVA) functionality. Especially useful in casinos, IVA embodies advanced

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functions such as new colour filtering capabilities that for the first time allow object colour or even a combination of colours to be set as a detection criterion. IVA also has an extended filter set with powerful new features that can detect specific objects like abandoned or unattended baggage. It is also capable of detecting suspicious behaviour such as loitering. And it does all this in real time. IVA also triggers a recording only when events that violate the ‘known rules’ are detected, dramatically reducing the amount of recording disk capacity required. In addition, IVA offers powerful forensic search capabilities based on searching content analysis information in the form of metadata – simple text strings describing specific image details generated and stored with the video images. This allows users to easily set up search queries that scan through this recorded metadata using smart search facilities and point them to video of interest in a matter of seconds. In addition, the forensic search function allows extra detection criteria to be set after the live video has been recorded. So even if during live video the system had not been configured to trigger on specific events, it is possible to configure it to detect such events later during a forensic search of the metadata relating to the recorded video. COMPLETE CONTROL Robust and versatile network control of a casino’s IP-based surveillance system can greatly enhance its operation and optimise efficiency. For this, we offer the VIDOS Video Management System, a powerful and customisable software package that controls all functions in the IP CCTV system and

supports an unlimited number of cameras and monitors. VIDOS integrates with existing peripheral equipment such as dome cameras and analog monitors. SUMMARY The solutions described in this article offer a limited overview of our total product offering for casinos. In addition to CCTV surveillance the company also provides a comprehensive range of innovative systems for intrusion, fire and access and sophisticated building integration. In short, we are a ‘onestop-shop’ for all security, safety and CCTV surveillance requirements of modern casinos, with a list of more than 100 reference accounts around the world...including many on the Las Vegas Strip. CGI

RAYMOND WEIJT Raymond Weijt has been working for Bosch Security Systems for eight years. His background is in Marketing Communications and IT Consultancy and he is currently responsible for Marketing Digital Recording for Bosch EMEA (Europe, Middle East and Africa). Raymond foresees a big shift towards easily accessible and easy to manage IP recording solutions for mid- to medium-sized CCTV systems.

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Compliance Testing Lab (CTL) continue to ensure fairness and integrity of the innovative games being brought to the player UKAS inspections of our quality systems, test methods, technical competence plus due diligence and vigilance ensure CTL continue to lead the way

CAST Limited was the UK’s first approved and accredited independent testing house in October 2007 and they achieved this in a record time with the support from the owners of CAST, Bangor University. This accreditation enables CAST’s Compliance Testing Lab (CTL) to undertake compliance testing of gaming machines, gaming sites, and bingo and casino equipment for UK and online remote games. In order to assure the various jurisdictions’, as well as the players, randomness and fairness are quality assured through CAST’s quality control procedures BS/EN ISO 17025. CAST’s CTL was recently audited by the United Kingdom Accreditation Service (UKAS) which involved a strict assessment of exacting standards, integrity and professionalism and passed with flying colours. CAST can test many categories of games for different technical standards and assessments. Failure to comply means that the licensed operator can, by the powers of the UK’s Gambling Act, have their licenses suspended or even be fined for more serious failures. However, CTL have found operators to be transparent and professional in their gaming and gambling audit ability. With approved games notified to the UK’s Gambling Commission it ensures their high standards are met in protecting the public. In the latest survey by the gambling commission, the results show that the vast majority of the largest operators and those with the greatest UK facing business have sufficient social responsibility measures in place. (Source: www.gamblingcommission.gov.uk) Building on the approval of the UK’s Gambling Commission, CAST is extending its on-line testing activities, and is delighted to have recently been awarded its first contract through the Alderney Gambling Control Commission (AGCC). Alderney’s Chief Executive Officer Andre Wilsenach said “We’re really pleased to have CAST’s CTL on board to work with our licensees. We see enormous benefits in having a European based test house and we look forward to developing the links with CAST.” He also commented that “as Margrit worked with us as a Technical Inspector for a number of years, we’re very confident that the team at CAST fully understand our requirements.”

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Margrit Schneider has a software engineering background having worked with a number of blue chip organisations on software development. More recently, she worked for four years as a Technical Inspector with the Alderney Gambling Control Commission. With a keenness to improve Internet security and compliance in particular, Margrit is just completing an MSc in Forensic Computing at Cranfield University in her own time. With Margrit’s extensive experience in assessing the test houses and technical knowledge of compliance in the gaming industry, she is ideally placed to lead developments for CAST. The test house can add real value to businesses by de-risking developments of new games and by diagnosing flaws in existing games and by making the testing of games more predictable and successful. Further discussions are underway, and CTL are looking to be approved by Malta and the Isle of Man jurisdictions, offering opportunities to work with customers operating farther afield. With market forces increasing the demand for online gambling and Interactive Based Gaming, CAST is well placed to combat the challenges of fraud by offering high quality consultancy and testing services on Internet safety and security to Industry Operators and Software Gaming Engineers. The advantages of engaging with CAST at an early stage are that non-compliance and security issues are discovered and problems are highlighted at a very early stage. Building relationships with the Industry Operators’ development teams means that once the game is fully operational it is quicker and more cost effective for evaluation of the games. Operating procedures regarding the company’s quality systems, test methods and technical knowledge are frequently reviewed to ensure CTL reliability and creditability is maintained. Due to the more stringent testing methodologies, it is duly recognised that there has been a marked improvement in the fairness of gambling and gaming since the Gambling Act was passed. CAST’s highly skilled team of trained computer scientists and statistical auditors work together with Industry Operators and the Government Regulators to ensure that the software is random, fair and secure. Gaming is so fastpaced that the Industry Operators, to keep up with this fast changing environment, need to choose a test house with tried and tested experience to overcome the hurdles and obstacles of innovative and highly complex gaming and gambling systems. CTL test all categories of gaming machines including FOBT and VAWP machines, plus analysis of software, hardware, peripherals, middleware and communications, server-based gaming systems, online interactive games, bingo and casino equipment, random number generators (RNG) and game return to player (RTP) calculations. The later two are particularly important as RNG and RTP should be strictly tested to ensure non-predictability and fair distribution to the player. This testing is often viewed as a timely and lengthy process but the costs can be minor in comparison to the huge losses that can be incurred if there is financial exposure in a game.

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Technium CAST, is the Welsh Assembly Governments flagship building in North West Wales and it is here that CTL have their assessment and testing laboratory, ensuring that games in the UK can be tested in the shortest possible time. The technical team fully understands what the regulators are looking for in today’s modern gambling games and CTL’s streamlined processes and operations ensure delivery of high quality results. Technium CAST, a £17.8 million Objective One initiative, has state-of- the-art technical space, first class security plus world leading data visualization facilities. CTL, a division of CAST Ltd, is a wholly owned subsidiary of Bangor University. This long-established academic institution is, this year, celebrating 125 years of academic excellence. Over half of the departments assessed to date in the teaching quality assessments have received the top rating of ‘excellent’. Performance in the 2008 Research Assessment Exercise confirms Bangor University place amongst the world's top universities. The opportunity for a testing laboratory was a result of innovation and intervention by the Welsh Assembly Government and Bangor University. The latter is recognised as the best in the UK for fostering successful partnerships with business at the KTP awards 2007, and it is highly rated for world leading research identified in all of the19 assessed subject areas. Dr Trevor Fielding, Director of CAST Ltd says “CTL has been a highly successful enterprise of Bangor University and CTL can call on the expertise and support of the University for new Emerging Technologies in gaming and computer software. CTL also has access to a huge pool of talented individuals including statisticians, experts in pure and applied mathematics, computer scientists and psychologists. With access to academia and graduates, and their associated excellence in Research and Development, the company is well placed for future strategic development.” As well as offering an efficient and cost effective fairness testing service, the CTL team are now offering 15% off your next gambling or gaming test. CTL can be contacted on 01248 675100 or alternatively visit www.fairnesstesting.com and www.techniumcast.com For job opportunities in the Compliance Testing Lab, please contact Caroline Thompson on 01248 675100.

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Best Brains in gaming back IGE as centre of excellence anuary’s International Gaming Expo (IGE) underlined its status as the international centre of gaming excellence, with leading developers and suppliers of equipment to the high stake casino, low stake street market, remote gaming and betting/lottery sectors confirming their attendance at Earls Court six months ahead of the exhibition opening its doors to buyers. Taking the total number of confirmed exhibitors at IGE 2010 so far to 140, the latest

tranche of supporting exhibitors comprise some of the world’s biggest brands within their respective sectors, including: Novomatic-AGI/Astra Games, IGT Group, WMS Gaming, Bally, TCSJohnHuxley, Aristocrat Technologies, Atronic, Merkur Gaming, JPM/Synot, TAB Austria, Play4Win, Boss Media, Playtech, Microgaming and Cryptologic – to name but a few. Emma Green, Clarion Gaming show director, commented: “There is absolutely no doubt that the best brains in gaming will be at Earls Court

presenting the latest technologies, outlining and discussing future trends and most importantly providing buyers with the gaming solutions that their businesses require in order to flourish in what is an increasingly competitive discretionary spend market. IGE is a renowned business show at which best in class manufacturers and developers will be launching best in class products and providing best in class firsthand insight to buyers. It is the leading centre of gaming and manufacturing excellence and unequivocally the best place to do business.”

IGT-UK Group to showcase multi- Why meeting the channel product portfolio at IGE manufacturers is crucial

GT-UK Group will demonstrate the full scope of its capabilities at IGE 2010. The exhibition will mark the first time the Group has come together to showcase its entire multi-channel product portfolio at an industry event. Barcrest Group, Cyberview Technology, WagerWorks and Million-2-1 will share a prime spot at the front of Earls Court 1, with IGT-UK Gaming represented on the main IGT stand located in Earls Court 2. Robert White, IGT-UK Group

vice president, commented: “Showcasing our products as a group is consistent with our strategy of offering leading game content across multiple channels, including mobile and internet. This approach will allow visitors to the IGE to come to a ‘one-stop shop’ for great games. “IGE is a pivotal part of our business year, with many key products for UK, international and remote gaming audiences being presented for the very first time. IGE provides the ideal platform for meeting up with key executives from across the entire spectrum of our business to discuss the latest products and the future direction of the business.” Julian Graves, managing

director of show organisers Clarion Gaming, added: “IGE is the only forum where operators can meet with leading suppliers across every gaming discipline. The synergies of high- and low-stake, remote gaming and betting/lottery products and services could not be better exemplified than by the plans being drawn up by IGT-UK Group, whose extensive showcase will incorporate blue chip brands within their respective sectors. “IGE’s unique total gaming proposition allows visitors the opportunity to see all of the latest products relevant to their businesses as well as discussing future applications and adaptations with the originators of closely linked content.”

avid Orrick, communications director for the Novomatic Group of Companies, believes that buyers from all destinations want to see the originators of product when making their purchasing decisions. He explained: “The buying process is quite a complex one and the depth of information that’s required can best be gained from speaking with manufacturers faceto-face. Certainly visitors to our stand at Earls Court will be able to get all the information, detail, insight, strategy and more from the people who know most, which is the

originators of the product. “Serious buyers always want to speak with the manufacturers or originators first – after all, that’s why they attend exhibitions in the first place; to have access to the people that matter and to the people who can have a positive impact on their business.”

The International Gaming Expo takes place at Earls Court Exhibition Centre, London, UK across 26-27-28 January 2010. Visitor and exhibitor enquiries via www.ige-exhibition.com

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MACAU PROVIDES AN EXCEPTIONAL TEST OF TOMORROW’S TECHNOLOGY TODAY BY KONRAD HECHTBAUER

While there are common features to facilities that require extensive systems of monitoring, detection and protection, few match the level of sophistication and real-time demands of a casino. And in Macau there has for the last four to five years, been a completely fresh base from which to develop some of the most enduring and effective solutions.

he Cotai Strip in Macau is an exceptional construction project. On a 1.8 mile stretch of artificially constructed land between the islands of Coloane and Taipa, a skilfully planned gaming paradise of unimaginable proportions is taking shape. And it’s not only the casino complexes which are unimaginably large; the CCTV/IP systems are just as impressive. In the past years, Macau has been growing steadily. Not only are enormous new themed casinos and hotel complexes constantly appearing, but the existing casinos are having to expand again, often as soon as they are built, in order to meet the immense demand. Elaborate, fantastical resort complexes such as the Venetian, Wynn, MGM, Crown or – just opened – the City of Dreams Macau make players hearts beat faster and have led to the pulling power of Cotai Strip exceeding that of its role model Las Vegas.

MACAU'S HISTORY Soon after the UK returned Hong Kong to China in 1997, the Portuguese returned Macau to China in 1999, after 442 years of rule. While Hong Kong is a known shopping destination to many, only one hour ferry ride from Hong Kong, Macau was an obscure place. Many were associating this small area of nearly half a million people with the Chinese triad gangs, red-light districts, and most of all Chinese-only casinos. Soon after Macau was returned to China - the China Centre for Lottery Studies at Beijing University estimated that about CNY600bn, or US$72.5bn, in gambling money flowed out of the country every year. So, in order to retain as much of that money as possible, the Chinese government deregulated its gambling industry in 2001. Soon after this deregulation, the doors of Macau were opened to other casino owners. This Casino & Gaming International I 33

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>> NOW, ALONG WITH INCREASING MASTERY OF THE TECHNOLOGY, THERE IS ANOTHER TREND IN THE SECURITY INDUSTRY. WHILE SIMPLE WHITE OR BLACK CAMERAS WERE ONCE SUFFICIENT, DESIGN NOWADAYS PLAYS AN INCREASINGLY IMPORTANT ROLE. SECURITY TECHNOLOGY SHOULD NO LONGER LOOK LIKE SUBSEQUENTLY ADDED TECHNICAL EQUIPMENT, BUT INTEGRATE INTO A BUILDING'S INTERIOR DESIGN. >> included operators such as Las Vegas Sands, Wynn, Galaxy or MGM. The long term idea for Macau was to create a ‘casino strip’ similar to the Las Vegas casino strip where all the major casinos would be located. The decision that the Chinese government made has proved a smart one, as something unbelievable happened the Macau casino industry surpassed Las Vegas as the world's largest gambling market. It is a clean, modern and safe place to visit and there are no gangs to fear. So, next time you go to Macau prepare to see a Las Vegas style casino strip - only bigger and more modern.

as the best in its class, future-proof and easily expandable. To their surprise not only did it offer the best system redundancy and best picture quality, but also required less bandwidth from the network. The Sands casino was completed in 2004, starting with 1,200 cameras and MPEG-2 recorders with broadcast picture quality. At the time, this was the largest digital recording CCTV system in the world with video switching and PTZ control all done through a network. This is one of the first large CCTV video and management systems without analogue matrix switchers.

WORLD’S LARGEST CASINO SURVEILLANCE SYSTEM WITH DIGITAL MATRIX It’s not only the casino complexes which are unimaginably large; the CCTV systems are just as impressive. In an open international tender in 2003 the first foreign casino in Macau, the Las Vegas Sands Casino, was looking for an appropriate CCTV surveillance solution. Among a few leading CCTV brand offers, and after conducting some testing and trials, the Sands management chose our solution

EXPANDING... While Las Vegas generates more than 50 percent of its tourist takings by other means, for example, from hotels or shopping malls, Macau visitors just concentrate on one thing: gambling. Most of the players who come as day visitors appear to dedicate every minute of their stay to gambling and completely forget about eating and drinking. Some of the casinos have already responded to this by turning over part of their restaurant areas to additional gaming tables and slot machines.

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The Sands also wanted to double its capacity in 2005 – and so we were requested to expand the monitoring system accordingly. The superlatives continue. In 2006 we won the contract for the biggest real-time IP video system in the world for the Venetian Macau, which was opened in August 2007 in a spectacular ceremony with many invited guests and great pomp. On the first day, numerous visitors rushed into the casino building to enjoy the diverse gambling opportunities. The casino counted 70,000 visitors within the first six hours. The CCTV system also commenced operations that day. And everything went perfectly smoothly and to the full satisfaction of the customer. That was an impressive achievement in view of the proportions. More than 3,500 channels were installed during the first phase of the project, while a further 1,500 channels have been integrated into the system. On top of that, the Sands, the Venetian as well as the surrounding hotel facilities are scheduled to be integrated into one interconnected network and controlled from one main control room. Founder of the company and CEO Dieter Dallmeier commented about that project: “We have installed some of our solutions in the biggest systems in the world, for example for the Venetian Group in Macau. We achieved data security of 99.99994 percent – better than the famous five nines! Just a few statistics bring home the size of the project: we are talking here about a total storage capacity of approx. 1.5 Petabytes. So we have broken through the magical sound barrier of the petabyte. That, by the way, is a figure with 15 zeros! And the solutions which have proved themselves on a large scale, we also use in small scale projects. Because what functions on a large scale, also functions on a small scale – but not necessarily the other way round.”

NEW DREAMS There is no end in sight to the economic boom in Macau. In the wake of the upswing, a truly dreamlike new casino and entertainment complex opened its gates in June 2009: the City of Dreams. Reading the description of the new City of Dreams one gets the impression that the project really seems to live up to its name. It is a dream city that leaves nothing to be desired. Exciting entertainment, elegant night clubs, a fascinating range of overnight accommodation, regional and international haute cuisine and world-class shopping facilities as well as a copious and modern casino blight any boredom. As of now, 550 gambling tables and 1,500 state-of-the-art slot machines are planned. Less noticeable for customers, but just as impressive, is the sophisticated video security system, which is not only providing the necessary overview at the casino but also in the adjacent hotels and leisure facilities. The entire installation, ranging from cameras to recorders and right up to software and video management, comes from CCTV/IP expert Dallmeier. Leroy Daniel works as Director of Surveillance for the City of Dreams. He is a casino industry professional with 16 years experience and has been involved in eight casino preopening projects, either serving in a surveillance or security capacity. His most recent place of activity was the Crown Casino Macau. As was the case with previous projects, Daniel will again work for Melco Crown Entertainment Limited at the new City of Dreams. Shortly before the opening of the Casino, Leroy Daniel spoke with Willy Allison (founder and president of World Game Protection) and explained the setup of the system. “The surveillance system for City of Dreams is an IP Casino & Gaming International I 35

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based system with distributed architecture comprising of servers, switches, workstations, Network Storage Unit (NSU), and cameras. The IP cameras encode the images at 25fps at D1 (720 x 576 pixels) resolution and the signal is then transmitted to the NSU via the surveillance network for recording. The cameras support multicasting to enable the live video stream to be broadcast to multiple workstations/monitors while the recorded camera images are streaming from the NSU. All camera switching is done through a virtual matrix which has allowed us to utilize more effectively the large amount of space that would traditionally be taken up by an Analog Matrix. We have one of the world’s first and largest 100 percent end-to-end IP casino surveillance systems. This means image encoding takes place directly within the IP Camera unit prior to being run through the surveillance network after which decoding takes place just before play back on LCD monitors.” Leroy Daniel explained the special demands of the casino: “If you were to take a look at prisons, airports, shopping malls, hospitals, campuses and the likes, I believe you will find that few CCTV applications are as demanding as -- or require a higher concentration of cameras -- than in casino operations. Numerous work stations with live streaming video, multiple consoles monitoring real time with constant reviewing and playback of footage with the need for fine details and high quality resolution. The more we can see those fine details on the gaming floor, the better we can serve the business by providing a high level of support to operational business units. For this we needed a highperforming system suitable for casino operations. We also had to be able to customise the system with enhancements to better interface it to gaming and revenue associated applications.” TECHNICAL BACKGROUND: HOW IT ALL BEGAN... Some 20 years ago, such gigantic CCTV/IP would have been absolutely unthinkable. It has been a long way from the first 36 I Casino & Gaming International

simple recorder to an IP based video information system, and we have been instrumental in shaping this development. For a long time analogue recorders which recorded onto VHS cassettes were used. However, those systems were highmaintenance as worn out parts had to be regularly renewed and the VHS cassettes had to be manually exchanged once the memory was full. Not to mention the enormous space requirements that were necessary in order to archive the VHS cassettes. If research purposes necessitated a search for relevant image sequences, this usually meant time-consuming and laborious work. Inevitably, it was necessary to gradually sift through the individual video cassettes until the required scene was found. Due to the frequent viewing of the image material, the quality of the tapes became worse and worse and often had to be replaced. The major breakthrough was the introduction of the digital video recorders. We developed the world's first video sensor with digital picture memory in 1992. At first, nobody took the idea of using digital picture memories in security technology very seriously and the concept was almost derided. Back then, given the extremely small capacities of storage media in those days, nobody was willing to seriously believe that video recorders would indeed one day replace the analogue recording devices. However, the digital idea, in combination with the appropriate technology would eventually prove to be ground-breaking and revolutionise video surveillance. Today, it is impossible to imagine a world without surveillance technology. In the area of casinos, the world’s first digital surveillance systems were installed at the Crown Casino in Melbourne in 1996 and, just one year later, at the Star City Casino in Sydney – developed and manufactured by us. Compared to the old analogue systems three major advantages stood out: better image quality, a reliable availability and enhanced userfriendliness. Over the years, we have not only continually been improving the digital recording devices but we have also

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>> IF YOU WERE TO TAKE A LOOK AT PRISONS, AIRPORTS, SHOPPING MALLS, HOSPITALS, CAMPUSES AND THE LIKES, I BELIEVE YOU WILL FIND THAT FEW CCTV APPLICATIONS ARE AS DEMANDING AS -- OR REQUIRE A HIGHER CONCENTRATION OF CAMERAS -- THAN IN CASINO OPERATIONS. NUMEROUS WORK STATIONS WITH LIVE STREAMING VIDEO, MULTIPLE CONSOLES MONITORING REAL TIME WITH CONSTANT REVIEWING AND PLAYBACK OF FOOTAGE WITH THE NEED FOR FINE DETAILS AND HIGH QUALITY RESOLUTION. THE MORE WE CAN SEE THOSE FINE DETAILS ON THE GAMING FLOOR, THE BETTER WE CAN SERVE THE BUSINESS BY PROVIDING A HIGH LEVEL OF SUPPORT TO OPERATIONAL BUSINESS UNITS. FOR THIS WE NEEDED A HIGH-PERFORMING SYSTEM SUITABLE FOR CASINO OPERATIONS. WE ALSO HAD TO BE ABLE TO CUSTOMISE THE SYSTEM WITH ENHANCEMENTS TO BETTER INTERFACE IT TO GAMING AND REVENUE ASSOCIATED APPLICATIONS. – LEROY DANIEL, DIRECTOR OF SURVEILLANCE, CITY OF DREAMS >> developed individual solutions tailored to the specific requirements of the casino industry. For casinos the critical issue is, above all else, the availability of the image material. In order to ensure as high a failure safety as possible, we bank on recording directly at the encoder. Therefore, the recording is network–independent and is continued even in the case of a complete network failure. This storage concept also minimises network requirements (bandwidth) since streaming is only carried out if necessary. So as to be able to install even the largest systems in a space-saving and cost-efficient way, we have developed very special recording devices with blade technology – a 19" module rack can house up to 10 individual modules. The modular design of the system and the hot-plug functionality of the individual modules ensure a high availability of the complete system. It achieves an availability of 99.99994%! The blade technology is not only extremely reliable but also very service- and maintenance-friendly. Should any malfunctions occur the defective component can be exchanged per individual channel. Owing to the HotPlug functionality of the modules the exchange maintains continuous operation, thus reducing downtime to a minimum. Furthermore, we have used its long years of experience to develop our own cameras. The decision was made because cameras form the first element of a security system and should therefore be chosen particularly carefully. The logic for this is simple, as even the best recorders can only record highquality images if the camera provides a good signal. We have even gone a step further: The cameras were adjusted to the special requirements of casinos. This was the beginning of the CasinoCam, a special camera that, thanks to a specifically developed software, is able to provide quick and optimal adjustment to the different scenarios in a casino. With the CasinoCam a special camera was developed whose specifically developed software allows the camera to quickly and ideally adjust to the different scenarios in a casino. Most standard cameras are not up to such challenges. NOT MERELY FUNCTIONAL, BUT ALSO STYLISH Now, along with increasing mastery of the technology, there is

another trend in the security industry. While simple black or white cameras were once sufficient, design nowadays plays an increasingly important role. Security technology should no longer look like subsequently added technical equipment, but integrate into a building's interior design. We have been a pioneer in this area as well and given fresh impetus to the market with DesignCams. Apart from their outstanding image quality the cameras are characterised by their extraordinary appearance, which can be designed according to the wishes of the customer. Therefore, the cameras can be adjusted to individual architectural conditions and discreetly integrated into the premises. Leroy Daniels also mentions this fact when asked about the challenges of the City of Dreams project: “We’ve had to deal with very common issues in new projects such as the CCTV system clashing with existing ceiling design or lighting features. It has been an interesting challenge due to the complexity of the property. As we have rooms of varying ceiling heights, using various decorative fixtures and lighting design, this has led to the deployment of over 10 different camera mounting options in order to accommodate various design elements without compromising our revenues.” The practical experiences gained in Macau illustrate that, above all, CCTV/IP solutions for casinos have to be flexible and open to changes and expansions. Since the systems are open to new technologies and possibilities at any time, we can only be curious as to what the future will bring. CGI

KONRAD HECHTBAUER Konrad Hechtbauer is an electrical engineering technician and Director, Project- & Application-Development with Regensburg-based CCTV/IP specialist Dallmeier. He has been working for Dallmeier for eight years and was most recently in charge of the planning, projection and commissioning of the Venetian mega project.

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Pioneering the World of Real-time IP Matrix! Benefit from our experience: Dallmeier has planned and realised the biggest real-time Video IP systems in casinos worldwide. casinoteam@dallmeier.com www.casino-surveillance.com

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Dallmeier – Pioneering the World of Real-time IP Matrix! Dallmeier is a leading global supplier of network-based video surveillance systems for casinos and has been developing and producing comprehensive high-quality solutions for the CCTV/IP industry for over 25 years. With recorders, cameras, video analysis systems and customised video management, Dallmeier offers complete system solutions from a single source. All adhering to the motto: “Quality made by Dallmeier”. Specially developed CasinoCams Cameras form the first element of the system and should therefore be chosen particularly carefully. The logic for this is simple, as even the best recorder can only record high-quality images if the camera provides a good signal. For this reason, with over 25 years of experience, Dallmeier produce their own cameras. Dallmeier took the latest Pixim DPS technology and used it as the basis for its own Cam_inPIX® development. With this cutting-edge camera technology it is now possible to solve familiar problems of the video surveillance technology, which with conventional technology were previously deemed unsolvable. The most extreme light conditions, such as backlighting or images that are constantly changing due to environmental influences, can be mastered with the Cam_inPIX® technology. Compared to conventional standard cameras the Dallmeier CasinoCams are designed to perfectly meet the specific requirements of casinos: Especially for casino conditions, various presets have been developed. There are for example the “gambling” preset for the surveillance of roulette tables or the “poker” preset for the clear identification of playing cards on various felt surfaces. Due to the user-friendly menu control of the Dallmeier CasinoCams they can be installed easily, quickly and cost-effectively in any specific surveillance situation. Apart from the outstanding image quality the design of the CasinoCams also leaves nothing to be desired. For each model is also available as a DesignCam whose design is created exclusively according to the wishes of the customer – ranging from burl wood, stone, carbon to crystal look. The design possibilities are unlimited! Highest availability – get 99.99994% Dallmeier’s Digital Matrix with its DIS-2/M modular audio/video recording and transmission system in a 19” rack construction with slide-in units is the ideal solution for monitoring critical areas where high-quality recording and real-time transmission are required. The Dallmeier high-secure storage approach relates to high-availability of storage directly at the encoder. The recording is not network dependent therefore it is not disturbed even during interference or complete network failure. Due to a sophisticated technology and intelligent structure Dallmeier video systems achieve an availability of 99.99994% – even better than the famous “Five Nines”. Such availability values can not even be achieved with extremely expensive storage systems. User-friendly video management A professional management system can ensure that the enormous quantities of data created nowadays by the recording of surveillance scenarios can also be handled by users. The Dallmeier Video Management Centre VMC-1 “Eagle” is modular and thus flexible in its structure. The individual components, whether it's the keypad, the joystick or the Jog-Shuttle, may be positioned according to individual preferences and are therefore equally well-suited for both left- and right-handers. Moreover, it is also possible to use the individual components as freely programmable stand-alone devices. Sophisticated ergonomics and the classic, timeless design allow for an effortless and efficient operation because the product designers precisely analysed the typical motion patterns of security operators. Fit for future All Dallmeier systems are of modular design. The high flexibility of this concept makes extensions simple and straightforward and keeps the system open to new technologies at any time. The investment is secured for several years to come.

www.casino-surveillance.com

www.dallmeier.com

www.caminpix.com

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Featuring presentations from over 90 of the World’s iGaming industry experts

2009

COPENHAGEN 15-17 SEPTEMBER

8th Annual European iGaming Congress and Expo

Network with 1500 industry leaders and decision makers from over 60 countries How you will benefit: • Identify new market opportunities and define their legal scope in Denmark, France, Italy, Spain, USA, Asia and Latin America • Enhance your customer retention and acquisition processes to beat increased competition • Gain market share by staying ahead in your use of new delivery methods from smart phones to using mainstream entertainment brands • Innovate with new products and target new audiences to achieve and retain competitive advantage • Take a fresh look at your relationship with affiliates and adjust to a new era of profitable strategic partnerships • Learn from CEOs of the major iGaming operators and get insights into consolidation and business diversification

2008 Highlights:

Back by popular demand:

New at EiG 2009:

• 1500+ attendees to network with

• CEO industry leaders’ panel

• Speed Networking sessions

• 70+ exhibitors

• Start-Up LaunchPad

• Industry pioneers’ panel

• 60+ countries

• Outside-the-industry keynotes

• 152 CEOs

• Oﬃcial EiG Welcome Reception and Networking Party

• Bigger, better Expo bar experience: more space, comfort and style

• 33 of the Power 50

• A fresh line-up of 80+ industry speakers • Six conference tracks

www.eigexpo.com/CGIJ Quoting promotional code CGIJ

produced by

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ONE STEP AHEAD: MAKING THE MOVE TO IP VIDEO

BY OLIVER VELLACOTT

Recent developments in IP Video technology will accelerate the move from analogue to digital CCTV surveillance in casinos. With their ever demanding infrastructure and real-time response requirements, maintaining a cutting edge is vital to ensuring the smooth, cost effective functioning of increasingly diverse and integrated complexes. And since the ‘one-stepahead’ scenario runs as a central thread in this field, observing the continuing improvements is instructive for tomorrow’s innovations.

casino is typically a high-activity area with staff and guests interacting with large sums of money, creating a demanding surveillance and security environment. Local Gaming Board requirements for surveillance are extremely strict and the commercial implications for unreliable and poor performing CCTV can be significant. All of this means that a casino must deploy high quality, reliable and fully-featured surveillance. Many casinos are benefiting from digital surveillance solutions. We alone have deployed IP Video systems in 27 casinos around the world. Nonetheless, the majority of gaming establishments are still relying on traditional analogue VCR/DVR CCTV systems. Recent developments in IP Video technology, in particular High-Definition (HD) IP cameras and integrated security across IP networks, will make the move to digital surveillance even more compelling for casinos.

UNDERSTANDING TECHNOLOGICAL DIFFERENCES It is important to understand the fundamental differences between these two technologies, and the advantages that IP Video can bring to casino surveillance. Traditional coax or fibre-based analogue video systems are becoming increasingly difficult to maintain and expensive to expand. They are based around a central switching matrix which is costly to upgrade as new cameras are added. It is location dependent, meaning each new camera has to be cabled back to a central point. However, the biggest weakness of the switching matrix is that it represents a single point of failure – the matrix fails and the whole CCTV system goes down! In contrast an IP Video system is distributed, with the Security Management Software (SMS) and the IP network creating a ‘Virtual Matrix’. SMS workstations, Network Video Casino & Gaming International I 41

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>> A TRULY DISTRIBUTED IP VIDEO SOLUTION HAS PROVIDED THE CASINO THÉÂTRE BARRIÈRE DE TOULOUSE WITH MANY BENEFITS, NOT LEAST THE ABILITY TO LOCATE CAMERAS, NVRS AND ‘CONTROL CENTRE’ WORKSTATIONS AT ANY POINT ON THE NETWORK. THIS GIVES A HIGHDEGREE OF FLEXIBILITY AND ELIMINATES ANY SINGLE POINT OF FAILURE THAT IS OFTEN ASSOCIATED WITH ANALOGUE/DVR SYSTEMS. THE CASINO HAS DEPLOYED SEVEN WORKSTATIONS IN THE MAIN CONTROL ROOM, ONE IN THE SECURITY ROOM AND ONE ON THE DESK OF THE DIRECTOR GENERAL. >>

Recorders (NVRs) and cameras can be located at any point on the network. No single point of failure exists. Digital video from each camera is streamed around the network and any operator with the right permissions can view the video no matter where they are located. Scalability is therefore excellent – all that is required to add another camera is a local network point! Standalone fault-tolerant NVRs can be located around the network to increase redundancy and reliability. IP Video systems operate over standard corporate networks and often share resources with other IT systems. As these networks typically span entire organisations, so can any IP Video systems connected to them. As traditional control room equipment can be replaced by PCs it is possible and very cost-effective to set-up remote or shared control rooms in addition to the main casino monitoring facility. The emergence of High-Definition (HD) IP cameras will start to accelerate the migration to IP video in casinos, simply because the benefits of HD video are hugely significant and analogue systems cannot support it - the maximum resolution attainable with a composite video signal is only 4SIF.

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DEMANDS OF HIGH-DEFINITION (HD) VIDEO Megapixel IP cameras deliver substantially higher resolution images than conventional cameras. A high quality 4CIF IP camera provides a resolution of 704 x 576 or around 400,000 pixels. Standard megapixel IP cameras range from 1-5 megapixels (millions of pixels), with some specialist cameras exceeding 12 megapixels. The problem with these very high resolution products is the huge amount of data that needs to be streamed and recorded. This effectively limits their use for specialist applications only. The CCTV industry is starting to adopt the HD video standards developed for the TV industry, typically these are: • •

720p: 1280 x 720 - 1 megapixel 1080p: 1960 x 1080 - 2 megapixels

HD IP cameras are now available that use excellent H.264 compression technology to deliver high-resolution images at very low data-rates. This means they can be used on standard networks and storage and are ideal for mainstream

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The following scenario is typical where access control is integrated with the IP video system. An illegal entry with an incorrect smartcard is attempted and an alarm is generated. This automatically causes the nearest camera to pan and zoom to the door entry, display the video feed on a key monitor and highlight the location of the alarm on an interactive map of the casino floor. IP Video Security Management Software typically has powerful alarm handling facilities and is the obvious place to consolidate alarms from all of the integrated systems, as it is the interface most used by the casino security staff. ‘Cause and Effect’ becomes the real power in an integrated system and can provide the end user with advanced features that cannot easily be achieved in wired stand-alone systems. Alarms and events from non-security systems can also be integrated into the solution such as from fire systems and building management and from specialist systems such as Electronic Point of Sales (EPOS) and Automatic Number Plate Recognition (ANPR) for car park entry/exit monitoring.

surveillance applications such as casinos. The advantages of HD IP cameras can be summarised in three main areas: •

General Surveillance – A single HD megapixel camera can replace several standard 4SIF cameras, thereby reducing costs. An HD megapixel camera can see more detail in the same field of view or view a wider field of view at the same level of detail.

•

Forensic Detail – Many existing analogue CCTV systems simply do not provide enough resolution or quality for forensic evidence. Megapixel cameras solve many of these quality/resolution issues. In a casino, HD cameras can identify each card in a hand and chip values even when they are stacked, which is essential to catch certain scams where the chips are swapped post-bet. Similarly, if deployed in the valet/parking areas the driver and car licence plate can easily be identified and disputes can quickly and reliably be resolved.

•

Digital PTZ – HD megapixel cameras can digitally zoom quicker and with greater detail than analogue cameras whilst still recording the whole picture for later analysis. This provides superior performance and is more reliable than mechanical PTZ mechanisms.

INTEGRATED SECURITY Integration is the ability to seamlessly interface systems from different security disciplines to create a total solution that produces greater benefits to the casino operator than would be possible from the individual systems. When this is implemented across an IP network all the benefits of a distributed system remain and no additional cabling is required. The major advantage is the ability to trigger operations in one system from events or alarms generated in another, a process known as ‘cause and effect’. This creates a more efficient operator environment that leads to quicker incident response.

EPOS INTEGRATION Monitoring tills and cashier booths is another important aspect of casino security. EPOS systems can now be integrated, over the network, with the IP-CCTV system. Data sent from an EPOS system can be overlaid on live video displays, allowing operators to view the camera feed and till transaction simultaneously. The transaction information and alarms generated by the EPOS system are also bookmarked and recorded alongside the video. This facilitates visual identification of an incident in both real time and through post-event analysis. Powerful transaction analysis can be undertaken on the stored data, for example, finding out when a particular credit card was used by searching every till in the casino. Alarms generated by the EPOS system, such as ‘till left open’, ‘refund’, or ‘large note deposit’ can automatically trigger a number of events. For example, an alarm generated from a ‘void’ transaction can instantly display the video from that till camera so the operator can visually verify the transaction, thereby helping to reduce staff theft. VIDEO ANALYSIS – RESOLVING DISPUTES Fast and reliable resolution of disputes is of paramount importance to casino operators. Advanced video analysis features in IP Video systems ensures that the appropriate video clip of an incident or dispute can be found in a matter of seconds, as opposed to many tens of minutes with some VCR/DVR based analogue systems. Dispute resolution is further enhanced with the use of HD IP cameras, where the extra detail in the picture reduces conjecture. The nature of gaming incidents can hinge on a few frames of information. Many of the best IP Video systems guarantee that no frames will be lost when recording at full framerate, no matter how much motion is in the scene. They also provide the facility to review full frame rate footage in forward and reverse, in real time, at slow speeds and frameby-frame. These tools are absolutely fundamental to find the exact footage. Providing fast and reliable evidence to confirm or contradict customer disputes creates a better customer service environment and avoids unnecessary compensation, thereby saving the casino money. Advanced analytics can be used to analyse recorded Casino & Gaming International I 43

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SECURITY & SURVEILLANCE

footage with such features as Congestion Detection, Motion Detection, Abandoned Object Detection, Counter Flow, Virtual Tripwire, Shape-Based Detection, Object Tracking and Theft Detection. These analytics can also be run in real time at the camera. Pre-determined events are identified as they happen and can drive the virtual matrix, e.g. display a salvo on a bank of monitors. For example the analytics feature ‘Hooded Camera’ automatically triggers an alarm when the camera lens is obscured, which can alert the operator and instantly display the feed and location of the camera. Realtime analytics lead to increased effectiveness and improvements in incident detection hit rates. VIDEO RECORDING Reliable video recording is a fundamental requirement for the local Gaming Board and the casino operator. Gaming Boards insist that all active gaming tables are recorded and in compliance a casino operator is obliged to close a table that is not being recorded. The inconvenience, revenue loss and possible penalties mean that casinos need a high level of fault tolerance and redundancy to minimise downtime. An IP video system can eliminate table downtime due to a Networked Video Recorder (NVR) failure by deploying redundant configurations. Backup NVRs can work as failover backups and mirrors for primary NVRs. The backup NVR can continuously record the same video in parallel as the primary NVR (know as mirroring) or automatically takeover recording if the primary NVR fails. The backup NVRs can be located at a different physical location to the primary NVRs, adding further to the resilience of the system. Sophisticated webs or chains of NVR redundancy can be implemented allowing the user to choose their level of redundancy based on a risk/cost analysis. Robust standalone NVR products can provide a level of built-in resilience with dual redundant network connections and power supplies, RAID configurations and hot-swappable drives. CASE STUDY - FIRST IP VIDEO CASINO SURVEILLANCE SYSTEM DEPLOYED IN FRANCE One of France’s newest Casino and Entertainment centres in Toulouse has deployed our IP Video solution for its demanding security surveillance requirements. The Casino Théâtre Barrière de Toulouse is an exciting 14,000m2 venue, which includes a 1,200 seat theatre, 3 restaurants, 3 bars, 14 gaming tables and 250 slot machines. “We are pleased to have chosen IndigoVision for the first IP-based surveillance solution in a French casino in 2007,” said Steve Dupoizat, the Casino’s Director of Security. “The operation of the system has been very impressive.” Steve Dupoizat realised early on that a distributed IP Video solution was fundamental to provide the casino complex with a reliable, fault-tolerant and scalable surveillance solution. “We commissioned a trial of competing IP Video vendors led by an independent consultant,” continued Mr Dupoizat.“ We were chosen because of its superior compression technology, excellent video quality and the ease of use of their video management software for both the operators and supervisors.” SPIE Sud-Ouest, our approved partner, installed the 350camera system, which is controlled using ‘Control Centre’ Security Management Software (SMS). The software allows operators to view live and recorded video, manage alarms and to quickly search and analyse recorded video for an incident. 44 I Casino & Gaming International

“Having quick access to recorded video allows operators to deal efficiently with incidents and disputes,” added Mr Dupoizat. “Responsiveness is fundamental to the Casino as we need to respond rapidly to ensure smooth operation of the games.” The company’s advanced compression technology ensures video can be streamed across the network with a guarantee of no dropped frames, whatever the level of motion and activity in the camera scene. This was a fundamental requirement for Groupe Lucien Barrière when choosing the IP Video technology. Any dropped frames within a video clip could hide fraudulent or criminal activity and make any customer disputes more difficult to resolve. Redundancy and reliability were another key factor for choosing us. Should a camera or recorder fail, the associated gaming tables or slot machines may see their operation compromised. The reliability of our IP Video technology has been field-proven in 27 casinos around the world and it incorporates one of the most advanced fault-tolerant recording solutions available. Video from all of the cameras is recorded directly from the network onto 28 primary standalone Network Video Recorders (NVRs). The same video is simultaneously recorded onto 14 secondary windowsbased NVR servers as a mirror backup. Three additional standalone NVR units are configured for automatic fail-over, taking over recording from a primary NVR if needed. Video is recorded at full framerate continuously for 28 days on 80 key cameras and for seven days on the rest. Being a truly distributed IP Video solution has provided the casino with many benefits, not least the ability to locate cameras, NVRs and ‘Control Centre’ workstations at any point on the network. This gives a high-degree of flexibility and eliminates any single point of failure that is often associated with analogue/DVR systems. The casino has deployed seven workstations in the main control room, one in the security room and one on the desk of the Director General. There is no additional cost for this as ‘Control Centre’ software is licensed on an unrestricted basis within the cost of our hardware. CGI

OLIVER VELLACOTT Oliver Vellacott founded IndigoVision in 1994. He was previously a product manager with a background in intelligent camera products. Oliver studied piano at the Guildhall School of Music before gaining his first degree in Software Engineering from Imperial College London and then a PhD in Electrical Engineering from Edinburgh University.

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CASINO RISK MANAGEMENT

ACHIEVING COMPLIANCE OBJECTIVES BY PROTECTING BRAND AND PROFITS BY KENNETH RIJOCK

The focus here is on high profile potential clients – in particular politically exposed persons and celebrities – who demonstrate high levels of possible risk, the specific threats that they literally bring to the table, and the methods employed by compliance to control risk, but resulting in the minimum amount of interference and inconvenience for the active gaming client.

ompliance officers employed by gaming companies engaged in casino operations face an ongoing problem similar to those faced by their brethren in the banking industry: how to minimise the special risks of high net-worth and high profile clientele, and still keep their goodwill and their lucrative business. Such individuals are often seen by management as both cash centres for the casino, and celebrity magnets that attract the ordinary gaming public into the casino, both to see the rich and famous, and also to share a bit of the glamour that they impart to the casino by their very presence. The compliance staff must discharge their professional obligations, which include screening out high profile clients when, in the measured and objective opinion of compliance, the risks of reputation damage, financial loss, money laundering, civil litigation, criminal prosecution, regulatory fines, penalties and sanctions, or even potential loss of operating licenses, could result from acceptance of a new client, a continuation of an existing client, or the failure to immediately terminate a client relationship. This must be prudently conducted in the context of the long-term financial objectives and business plan of the casino, which exists for the purpose of earning a reasonable profit for its ownership. Compliance is a risk management tool to ensure that untoward or unplanned events involving clients do not jeopardise either the brand or its profits. Let us then survey two types of high profile potential clients who demonstrate high levels of possible risk, the specific threats that they literally bring to the table, and the methods employed by compliance to control risk, but resulting in the minimum amount of interference and inconvenience for the active gaming client.

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>> CELEBRITIES GENERALLY, BY VIRTUE OF THEIR OCCUPATION, ASSETS, BUSINESS SUCCESS OR INHERITANCE, HAVE SUFFICIENT WEALTH TO PROPERLY PARTICIPATE IN CASINO GAMING, OFTEN AT AN EXTREMELY HIGH LEVEL. THE FUNDS ARE RARELY AN ISSUE; IT IS THEIR OTHER ACTIVITIES THAT EXPOSE THE CASINO TO REPUTATIONAL OR FINANCIAL DAMAGE. >> I. The Politically Exposed Person: more commonly known by the acronym PEP, politically exposed persons are generally considered to be senior governmental officials, field grade military officers, senior officials of government-controlled companies, leaders of charitable entities, non-governmental organisations (NGO), unions, political parties or fraternal organisations, and those closely linked or associated with them, either through family ties, business arrangements, or social relationships. Individuals who have formerly held such positions are also regarded as PEPs, though authorities differ on the exact amount of time that must have elapsed since such employment has been terminated before their PEP status expires. Such individuals often have access, by virtue of their positions of trust, to substantial public, governmental, official, or private funds or accounts, which could be accessed without authorisation and consent of the agency or entity that owns such assets, and illegally appropriated for the individual’s own improper use. Since such embezzlement or larceny is often undetected until long after the funds are dissipated, their gaming activities must be monitored to ensure that wagering of funds in excess of their known income and assets is not allowed to occur. Such activities, if not detected on a real-time basis, can cause reputational damage for the casino, and even civil litigation. Therefore, compliance officers are tasked with the responsibility of identifying PEPs amongst prospective clients at the initial stage. They also should periodically monitor ongoing clients, to ensure that private clients, who acquire PEP status later on, are identified and appropriately monitored for risk management. Compliance officers initially employ the same customer identification procedure (CIP) that is utilised at financial institutions. Personal identifying information is collected and independently verified using a variety of sources including commercial off-the-shelf programmes and databases. Clients whose names appear on official sanctions lists are excluded from consideration. Passport information should also be checked in a manner that will ensure that altered or forged identities are uncovered. Since passports now contain OCR information, relevant software features can be utilised for that purpose. When PEP status is ascertained, and independently verified, management is then immediately notified, with estimates calculated for the annual salary, income and wealth of the client, so that measures can be put in place to ensure that any wagering by this client, which exceeds set parameters, is immediately flagged for the appropriate casino management team tasked to deal with such issues. Regular monitoring of the status of the PEP client is also required, for promotions do occur in the public, military, charitable and NGO sectors, and such action will upgrade the ability of the PEP to wager larger sums. Negative events 46 I Casino & Gaming International

could also impact whether the client should, or even could, on a risk basis, be retained. It is suggested that compliance officers at casino organisations practice the same type of regular client monitoring as is done at major financial institutions: run the names of all their active clients against a comprehensive high risk database, to ensure that the client has not been arrested on felony charges somewhere, or designated or sanctioned by any one of a number of governmental regulators, meaning that you can no longer carry him as a client without risking the imposition of fines and penalties upon the casino corporate entity. PEPs are also high risk because their positions often expose them to possible bribery, kickbacks or illegal compensation from companies who wish to conduct business with the governmental entity or NGO. In countries where there is little or no transparency or accountability, such arrangements are common, and can result in a huge amount of disposable, though illicit, income for the PEP. Precautions must be taken by compliance to ensure that ill-gotten gains, received outside legal channels, do not end up being wagered in casinos. Some PEPs merit what is known as Enhanced Due Diligence, an extensive investigation into the finances and background of the individual, due to the presence of several high-risk factors. Whilst such action is usually outsourced to companies with extensive experience in this field, the costs are justified where the potential income that the PEP, and his associates, should bring into the casino, or the prestige his presence as a client would confer is judged by management to be worth the expense. Enhanced Due Diligence goes much further than simple client identification procedures; it delves into all aspects of the potential client’s background, and a comprehensive and inclusive report is the result. PEPs are not excluded by compliance solely for the reason of their PEP status; properly checked and monitored, they will become valuable clients. II. Celebrities: Individuals regarded by the public as celebrities, such as cinema stars, professional athletes, millionaires, musicians, prominent political figures and assorted famous, infamous and notorious figures, are in a class all by themselves for compliance purposes. Please note that some may also qualify as PEPs. These types of clients present both potentially high threat levels, and the obvious marketing advantages when the media extensively cover their visits to the casino. The publicity that they generate simply cannot be purchased. It is a difficult task, but if correctly managed, by both compliance and management, celebrities can bring both valuable intangible, as well as financial, benefits to the casino who hosts them. Celebrities generally, by virtue of their occupation, assets, business success or inheritance, have sufficient wealth to properly participate in casino gaming, often at an extremely high level. The funds are rarely an issue; it is their

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CASINO RISK MANAGEMENT

>> THE COMPLIANCE STAFF MUST DISCHARGE THEIR PROFESSIONAL OBLIGATIONS, WHICH INCLUDE SCREENING OUT HIGH PROFILE CLIENTS… THIS MUST BE PRUDENTLY CONDUCTED IN THE CONTEXT OF THE LONG-TERM FINANCIAL OBJECTIVES AND BUSINESS PLAN OF THE CASINO, WHICH EXISTS FOR THE PURPOSE OF EARNING A REASONABLE PROFIT FOR ITS OWNERSHIP. COMPLIANCE IS A RISK MANAGEMENT TOOL TO ENSURE THAT UNTOWARD OR UNPLANNED EVENTS INVOLVING CLIENTS DO NOT JEOPARDISE EITHER THE BRAND OR ITS PROFITS. >>

other activities that expose the casino to reputational or financial damage. Compliance officers vetting celebrities face a daunting challenge when asked by management to provide a riskbased profile, for the major issues are serious ones: Drug and alcohol abuse: Remember the massive adverse publicity when a certain celebrity expired at a casino hotel. How many times was the casino’s name mentioned in the media frenzy? Any serious history of abuse could represent an unacceptable level of risk. Security: The physical safety of the celebrity must be ensured during his or her visits to the casino. Have there been previous incidents? Where did they occur? Does this celebrity have a higher than normal exposure to stalkers, kidnappers, individuals who want to injure or kill the celebrity, or cranks? Remember, there can be collateral damage (e.g. injury or deaths of casino patrons) during such an incident. Is there any threat from potential terrorist organisations? The celebrity’s history should be thoroughly reviewed by compliance, to rule out any unusual threat scenarios. Domestic violence: Does the celebrity, (or his/her significant other, or partner or spouse, or other relatives) have any history of domestic violence or a propensity to express anger through violent acts? Does anyone have a grievance or court case pending that might manifest itself in violence? Remember, bystanders injured during such an incident, or the victim, could bring a civil action against the casino, claiming that the celebrity’s prior history made the incident forseeable. Civil litigation records, domestic violence court records, restraining orders, criminal charges must all be reviewed. Firearms and other weapons: The celebrity and/or his or her bodyguard, entourage, partner or staff member, may be, lawfully or otherwise, carrying a concealed weapon. Remember, any actions taken toward self defence inside the casino grounds, either by the celebrity or his staff, could injure, maim or kill others in the line of fire. Has the celebrity or his staff been issued a carry permit? Does your casino security screen for firearms and weapons, and do you exempt celebrities (or anyone else) from screening? Lawsuits by next of kin can result in verdicts in the millions of dollars, highly damaging media coverage, and can also instill fear in potential casino clients, who may stay away after a high profile incident. Associates: When the celebrity and his entourage show up, there may be individuals who represent an unacceptable level of risk just by being present in the casino. Does the celebrity closely associate himself with anyone who is

completely unacceptable as a casino patron? Is there a history of this individual being present? Again, the photos taken by society columns, and even papparozzi, may provide clues. All of the above are admittedly high risk, and even controversial, subjects. Compliance officers detailed to investigate celebrities can be called upon to research these matters, well in advance of the appearance of the celebrity at the casino, and to advise management on all potential riskrelated facts and concerns. We have presented here a brief summary of the risk control issues compliance officers confront daily regarding Politically Exposed Persons, and celebrities, who become casino clients. Issue perception and recognition is an important component of the compliance process, and management expects compliance to be adept at issue identification, and to assist, where appropriate, at problem solving. High risk casino clients, when properly vetted, are valuable assets; strive to accept them wherever possible, within your compliance risk management parameters. CGI

KENNETH RIJOCK Kenneth Rijock (J.D. 1973, University of Miami School of Law) is believed to be the only professional in North America who has been a banking attorney, career money launderer and compliance officer, all in the same working lifetime. His articles appear daily on the World-Check website at: www.worldcheck.com/. He has testified three times before US Congress in favour of AML legislation, and has provided technical assistance to the US Congress examinations of artificial intelligence in money laundering investigations. He has also acted as an expert witness and analyst in money laundering matters in the US District Court in California.

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IMAGINE FINDING FRAUD YOU NEVER KNEW EXISTED. You probably have computers connected to you at this very moment that have previously defrauded your business. Other computers connected to you right now may have abused other online sites. We can tell you about both of these—the instant they touch your site.

Fraud exists. Let iovation help you find it!

For more information, visit iovation.com/cgi

111 SW 5th Avenue, Suite 3200, Portland, OR 97204 +1.503.224.6010 tel | +1.503.224.1581 fax www.iovation.com ©2009 iovation Inc. All rights reserved. iovation and the iovation logo are trademarks of iovation Inc.

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CASE STUDY

Entraction Uses Device Reputation to Carry Out "Zero Tolerance" for Fraud We look for bestof-breed suppliers and what iovation has delivered far exceeded our expectations. Device reputation doesn't only help stop fraud; it also helps prevent it in the future.

One of the leading and fastest growing suppliers of systems for online betting, casino, poker and bingo uses iovation to combat online fraud and abuse. Challenge « Entraction’s successful platform attracted online criminals « Risk of financial fraud, collusion, money laundering and infringements of rules « Existing tools did not meet Entraction's high standards on reducing fraud

Solution « Required additional sophisticated solutions that would not disrupt the player experience

Leonid Nezgoda

« Required solution to be efficient, scalable, cost-effective with low or no false positives

Managing Director, Entraction Estonia

« Needed top-of-class provider to tackle not only fraud detection but also prevention

Results « Quickly gained ability to stop repeat offenders « Easy for fraud team to adopt and add into existing workflow « Results were remarkable – way beyond expectations « iovation's fraud management service returned more than five times the investment

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Background Founded in 2000, Entraction supplies complete systems for online gaming, meaning that, for example, a media company wishing to integrate gaming into its website does not need to invest in payment solutions, customer support and other infrastructure. Over and above systems for poker, casino, betting and bingo, Entraction supplies support, affiliate systems, promotional tools and payment solutions. Entraction has developed proprietary systems for poker, betting and parts of the peripheral systems on offer. Other systems are supplied by third parties. Entraction's strategy is to successively replace third party systems with those it has developed or acquired, where commercially justified. A prerequisite for success in Entraction's endeavours to be one of the world's three largest suppliers within the digital gaming industry is to be able to control the development of new products and services to ensure that Entraction has the best offerings in the market. Partners can choose between an integrated solution containing a customized mix of different products or a turnkey solution in which the partner is responsible only for marketing. The company has proprietary software for poker and sports betting and licenses casino services and bingo from third parties.

With success comes threat The company’s success, skyrocketing since 2006, has been attributed to its excellent technology platform provided to customers and partners alike. However, with growth came the reality of fraud. The types of fraud seen by Entraction included credit card fraud, friendly chargebacks, chip dumping, player collusion, identity theft, and bonus abuse. In addition, fraudsters were increasingly trying to use Entraction’s gaming software to launder money. Entraction has a “zero tolerance” policy towards fraud, collusion, money laundering and other forms of infringements of laws and rules. With its popularity and growth, Entraction needed iron-clad protection. According to Entraction Estonia Managing Director, Leonid Nezgoda, “Fighting fraud and money laundering is the ultimate social responsibility. The majority of companies have to realize that while being better at fraud detection and prevention is a competitive advantage, it shouldn’t be, really. The industry should stand together on the issue of zero tolerance for money laundering.”

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Tool evaluation With the influx of fraud, Entraction focused on getting their house in order. They developed in-house tools and procedures necessary to reduce fraud. They had good results, but were still looking for ways to enhance efforts. They needed top-of-class providers to tackle fraud detection and prevention. To remain focused on what they excel at, Entraction began the search for key technology partners. The primary criteria for selecting a fraud detection tool was that it must: 1. 2. 3. 4.

Not interfere with player’s experience Provide efficiencies in the review process Detect and prevent fraud effectively Be cost-effective / affordable

Initially this seemed like a simple list – finding a product with a proven track record, that is cost-effective, and that does not interrupt the user experience. What they found was that many of the tools evaluated did interrupt the user experience. In other cases, there were new and unproven tools on the market which were very expensive and lacked sophistication. While those tools may have reduced fraud, they had a significant effect on the good players as well. Nezgoda says, “Many times, the other software programs identified our good players as fraudsters. We did not find that to be the case with iovation ReputationManager.”

Solution: iovation ReputationManager Entraction had no reservations about the effectiveness and efficiencies that were possible using device fingerprinting paired with device reputation; this is real data pulled from the user’s computer, coupled with fact-based fraudulent evidence from that computer’s past. Entraction’s list of iovation advantages included: Device reputation Players’ experience Internal audits IP address checks Manual checks Proactive approach Cost-effective If Entraction encounters a fraudster in their network, they now tag all associated devices to prevent the individuals from coming back repeatedly with new profile and credit card information.

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Lightning-fast integration Integration was simple and fast. The time from choosing iovation as a partner to having ReputationManager in production was just one month. During this process, Entraction went through five steps to implement iovation ReputationManager. 1. Decide the integration points – Account Login – Registration/Account Creation – Cashier/Financial Transaction 2. Apply the code to the website or download – Sample code supplied in various languages by iovation 3. Determine the business rules – Which fraud and abuse evidence types do we care about? – When should we Allow, Deny, or Review transactions? 4. Integration testing – A client integration environment was provided to fully test the code and production data 5. Go live

Results were beyond expectations After implementing iovation, the computers connecting to Entraction’s online gaming sites established reputations based on how they were used. If a device caused a serious problem on one gaming site, this fact-based evidence is shared with other iovation subscribers. By linking the computer's reputation to its related online accounts, Entraction fraud managers can now see exactly how a particular computer has been used in the past and are better equipped to expose and prevent the fraudsters from coming back. The reduction in online fraud after putting iovation ReputationManager in place was remarkable. Entraction can now proactively identify risky and suspicious behavior, expose fraudsters before they cause a problem, and stop literally thousands of fraudulent and abusive activities each day. After implementing iovation ReputationManager and other systems, Entraction has returned more than five times the investment. Their chargeback rates also declined to close to zero. “Even after the second year of having iovation in place, we still see our chargeback rate on volume of transactions continue to decline,” said Nezgoda.

Ongoing reporting and forensic research Business rules are set up for automating the process of accepting, denying or reviewing transactions. iovation also provides a web-based reporting tool for further forensic research.

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Transaction history report The “Transaction History” report is shown from the device perspective. You can see from the transaction history below that after evidence was placed on this device, all subsequent logins with associated accounts have been denied.

Result

Account

Denied

gimme_yerchips

Denied

gimme_yerchips

Denied

smokingaces_0155

Denied

bigtime_k8

Denied

bigtime_k8

Allowed

0155poker_k8

Additional uses for device identification Entraction found that device identification is reusable for many different purposes besides stopping external fraud and understanding hidden relationships between accounts. Internal audits Bonus fraud Risk assessment for different markets Understanding partner behavior Understanding the “true” number of players

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Using evidence from other businesses One of the common reports of interest to Entraction includes a list of “bad guys” at other online businesses that also have accounts on the Entraction network. It allows Entraction to understand what additional accounts in their network (tagged to devices associated with fraud) exist in their network and could potentially cause problems.

Gambling / Sportsbook Device

Evidence Type

Evidence Date

Association Date

device 101561011

1-1 Credit Card Fraud

11/17/2008 09:15 AM

03/16/2009 04:09 PM

Financial Services / Credit Issuer Device

Evidence Type

Evidence Date

Association Date

device 163151002

1-6 Potential Fraud

03/12/2009 01:18 PM

03/16/2009 06:27 AM

device 163151009

1-6 Potential Fraud

03/12/2009 01:18 PM

03/16/2009 06:27 AM

Online Community / Internet Dating Site Device

Evidence Type

Evidence Date

Association Date

device 150321003

1-1 Credit Card Fraud

03/16/2009 11:51 AM

03/14/2009 05:50 AM

device 160811004

1-1 Credit Card Fraud

03/16/2009 11:50 AM

03/08/2009 10:49 AM

device 160271006

3-9 Scammer/Solicitation

03/16/2009 02:23 PM

03/10/2009 12:52 AM

device 159541014

3-9 Scammer/Solicitation

03/16/2009 12:11 PM

03/02/2009 01:18 AM

Gambling / Poker Site Device

Evidence Type

Evidence Date

Association Date

device 45321007

1-6 Potential Fraud

03/16/2009 10:14 AM

02/17/2009 03:48 AM

True partners fighting cybercrime iovation ReputationManager is and continues to be Entraction's number one strongest technology partner for continued business success. With iovation, Entraction can remain focused on running successful online betting, casino, poker and bingo networks, knowing that their best-of-breed partner is effectively and efficiently managing fraud for their business.

For more information about Entraction or their software systems and services, please contact:

Entraction P.O. Box 3108169 03 Solna, Sweden +46 8 564 884 60 tel info@entraction.com www.entraction.com

To learn more about iovation ReputationManager™ and how it helps organizations fight online fraud and abuse, visit www.iovation.com.

iovation Inc. 111 SW 5th Avenue, Suite 3200, Portland, OR 97204 +1.503.224.6010 tel | +1.503.224.1581 fax www.iovation.com ©2009 iovation Inc. All rights reserved. iovation and the iovation logo are trademarks of iovation Inc.

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WE PROVIDE THE PIECES FOR YOUR GAMING BUSINESS Entraction is a full service provider of online gaming. We offer everything you need to be successful in the business. For your players there is always the element of luck at the tables and by the slot machines. But behind the scenes, we believe in nothing but hard work to supply your operations with the market’s best gaming platform.

POKER BINGO CASINO B ETTI NG MARKETING TOOLS PAYMENT SERVICES PLAYER SUPPORT AND MORE!

Meet us at EiG in Copenhagen 15-17 September, stand 352

WEB www.entraction.com

E-MAIL sales@entraction.com TEL +46 8 564 884 60

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The Isle of Man – Continued eGaming growth during the recession Over the last five years the Isle of Man has established itself as a recognised leading centre for eGaming, with a strong, diverse cluster of eGaming businesses currently employing around 500 people. The Isle of Man enjoyed particularly strong growth in 2008: the number of licensed operators increased from 10 to 16 and the sector created over 100 jobs in both new and existing businesses, both licensed operators and many specialist supporting businesses. The question is: in the post-credit crunch world, what are the prospects for future growth of the sector in the Isle of Man? In short – good. In terms of new businesses, the number of serious enquiries for businesses seeking to establish themselves here is currently double the level in 2008. Experience to date indicates that around 80 percent of visitors take the decision that the Isle of Man is the right place to base their business once they have visited. In terms of existing businesses, most are forecasting organic growth of over 25 percent. The sector is expected to generate well in excess of 100 new jobs in 2009. Current new business enquiries comprise a wide mix of companies from startups with many varied and innovative products to more of the major well known brands than have previously looked at the Island. Not only are businesses looking to licence but also place management and various functions of their business physically on the Isle of Man, both bringing in key staff and employing locally from the well-educated, computer-literate workforce on the Island. This is an important change. Some companies have often seen jurisdictions as defined mainly on where the server striking the bet is placed and focused their selection criteria for choosing a jurisdiction accordingly. Most companies now value the ability to build a strong management and staff team, supported by sector specialists plus by IT and professional services who understand the needs of this rapidly evolving sector. This change may be in part due to consideration of what really constitutes the jurisdiction of a business. There is certainly recognition that, as eGaming businesses mature and grow in terms of staff and strategic partners, the availability of both skilled labour and supporting businesses are increasingly important criteria for assessing a jurisdiction. So where is the growth coming from? There are fundamentally four areas. Firstly, the companies based on the Island include a number of market leaders and they continue to grow at a fantastic rate. They are looking for talented people, finding them and integrating them into their teams to continue the growth. Secondly, the Island seems to have got the message out to a wider audience that it is a place you can do business. The Government is proactive in looking for new ebusiness in general and eGaming specifically and has ensured a number of lawyers and advisors in the industry are fully aware of the advantages offered by being based there. The Gambling Supervision Commission and Department of Trade and Industry are both very approachable and will help a company throughout the process of looking for a jurisdiction and applying for a licence. The industry now knows that if there is not clarity as to a business plan fits the legislation then it is well worth having working with the Government to see if that business can be accommodated. Thirdly, there are a number of established and known businesses that are looking to change their European based jurisdictions. They are looking for a number of different things as the businesses become more main stream and are looking to achieve both market access and credibility in the wider business world. With the Isle of Man declared on the OECD White List, a member of the WTO and leading the way on openness and co-operation on tax information exchange, the links into the financial community globally and in the UK in particular appeal to many CEO’s. Of more immediate concern is reliability of the technical infrastructure and the ability to ensure the business remains linked to their customers. The five subsea fibre optic cables including two self healing rings to both Ireland and the UK are giving superb connections and reliability levels they are finding very attractive.

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Coupled with the clustering of services operators require, stability of the Government and a high confidence that both the tax regime and Gambling Legislation will not offer any surprises, this makes the Isle of Man one of the few places that the future can confidently be planned from. Indeed, the Isle of Man is committed to building further tax agreements with key jurisdictions, many of which are currently under negotiation, to facilitate effective business and gain further recognition as a leading international business centre. Finally, and not insignificantly, there are also a number of Asian based businesses that see the Isle of Man as the best place to base themselves to move into the markets in the surrounding area and time zones. With 188bet and SBOBet already based on the Island, the Asian gaming industry has taken a lot of interest in the Isle of Man. Bill Mummery Executive Director of SBO’s Manx company Celton Manx sums up the attractiveness of the jurisdiction: “The primary reasons for these leading Operators within the industry being attracted to the Isle of Man are the legal framework, high quality of regulation and compliance standards, a world class telecommunications infrastructure and professional services including banking, legal and accountancy. These companies have to make massive technology investments in their jurisdiction of choice and to do this they need stability, security and a Government that is supportive and will work with the industry. Every sector has change but none more so than e-Gaming where the dynamics are such that change can be measured in weeks if not months. For their customers, Trust is a major consideration in choosing the gaming company they interact with and being seen to be licensed and regulated in a high quality jurisdiction like the Isle of Man is part of providing the necessary level of comfort to their customers. Players know that if they use an IOM licensed operator their money is safe, they will get paid, and that they are dealing with reputable and responsible companies.” The eGaming sector has experienced its fair share of surprises in recent years and the future development of the sector in many markets worldwide is far from certain. The Isle of Man Government has remained committed to supporting responsible gaming and has enjoyed substantial growth both in terms of its economy and reputation accordingly. All indicators point to further rapid growth through 2009 and 2010.

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OPTION THINKING: KEEPING NIMBLE IS CENTRAL TO eGAMING SUCCESS BY CHRIS GLEDHILL

Should you buy your egaming platform off the shelf or go for bespoke? Rather than consider the choice, it could be that the solution lay in the use of a developmental framework for site construction. The approach requires standardisation – eliminating costs, reducing time factors and cutting risks from expansion – while providing enhanced functionality capabilities. This means getting the architecture right from the outset, particularly in tough economic times, is vital.

rganisations in the egaming sector, like most ebusinesses, are faced with the age old dilemma, should we buy our platform off the shelf or go for bespoke? With the first you get player networks and games right from the off along with the flexibility of running hundreds of sites with the same platform, not to mention the peace of mind in terms of security and liability. There are an equal number of benefits with bespoke solutions including having control of your own database, keeping content independent and creative licence for true innovation. But what if there was a third way? What if egaming companies could choose to integrate the best of both worlds to get the advantages of both and mitigate, eliminate even, the risks of going one way or the other? The solution could be to use a developmental framework for site construction resulting in a robust, standards-based solution that fully meets the specific needs of the operator. The key to this approach is standardisation which strips out a significant proportion of the cost while providing enhanced quality. Most egaming projects require much the same functionality:

• • • • • •

back office administration client registration and account management payments KYC permission and user management, and a multilingual front-end.

This typically represents about three quarters of the necessary functionality; the last quarter can be designed to meet the exact requirements of each site. Building software applications Casino & Gaming International I 61

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>> OUR APPROACH HAS EVOLVED THROUGH HARD WON EXPERIENCE BOTH IN THE eGAMING SECTOR AND MORE GENERALLY AS A SPECIALIST SUPPLIER OF HIGH PERFORMANCE, SECURE, ONLINE APPLICATIONS. IT IS AN INTERESTING PARADOX THAT THE MAIN FOCUS OF MOST DEVELOPMENTS (BE IT A SECURE CASE MANAGEMENT SYSTEM FOR THE POLICE OR A NEW eGAMING CONCEPT) IS THE SPECIFIC BUSINESS REQUIREMENTS; HOWEVER THE GREATEST RISKS TEND TO BE IN THE NON-FUNCTIONAL OR GENERIC ASPECTS SUCH AS SECURITY, SCALABILITY AND COMPLIANCE. >> in this way is similar to how a builder would construct a house. He would take standard and proven ways of doing the structural elements which ensure that the house won’t fall down, but have plenty of scope to be creative with the space and finish. Our approach has evolved through hard won experience both in the egaming sector and more generally as a specialist supplier of high performance, secure, online applications. It is an interesting paradox that the main focus of most developments (be it a secure case management system for the police or a new egaming concept) is the specific business requirements; however the greatest risks tend to be in the nonfunctional or generic aspects such as security, scalability and compliance. We cut our teeth in egaming through the development of a sports betting system for BetInternet launched back in 1998. This original platform supported sports, casino, soccer and tote betting services. Core functions, such as betting, odds and liability risk management systems and back office administration systems, were created with a standards-based development framework that allowed BetInternet the flexibility to grow, change and integrate with a range of content over the years. Since those early days we have refined and developed our framework based approach to provide a very stable architectural framework which supports a standard set of back office functions and provides an efficient starting point for building the unique elements which will differentiate each new development. THE THIRD WAY Racing2day.com is just such one example. It's a new online racing company, founded by Vincent Caldwell, former chairman at BetInternet, which was launched to take advantage of the growing global betting trends in pari-mutuel racing pools. The website and backoffice systems have been constructed using a mature development framework as a faster, cheaper and better option to traditional alternatives. Poised to exploit growing global betting trends in pari-mutuel racing pools, Racing2day's business model, unlike traditional sports betting with fixed odds, provides a risk-free margin. Online gaming sites in the US alone saw an 11 percent rise in unique visitors last autumn which equates to 16.1 million visitors online each month. To attract these visitors, Racing2day.com provides innovative racing content including social media elements such as expert bloggers and interactive forums. In time, it will feature international racing content from the United States, Canada, Europe, Australia, South Africa and Asia. 62 I Casino & Gaming International

Vincent Caldwell said: “We were not only impressed by the flexibility and scalability of the solution, which is crucial for a new and rapidly expanding business venture, but also the in-depth industry knowledge of the team behind it.” For this project, approximately 60 percent of code was standardised affording a significant reduction in development time in comparison to most bespoke web projects. Crucially, it also required considerably less coding than most 'off the shelf' integrated solutions to meet Raching2Day's specific requirements including complex security, resilience and performance management. Indeed, the website and back office administration systems easily interface with content provided by specialist third party providers including Amtote's hub system. KEEPING OPTIONS OPEN A key advantage of this approach is that operators retain control and flexibility. An egaming company could end up selling its soul to a software vendor which provides end-toend services. But strategically, it's quite high-risk to lose control of the core database. It significantly diminishes the choice of future partners and therefore the range of products and services to be introduced to customers going forward. Using standards-based solutions is central to ease of interoperability and it's difficult to refute Microsoft's leadership position. Using a mature development framework, based on .Net technology, significantly cuts expense and risks from expansion. Purple-lounge.com, part of the world’s largest online poker networks, Prima Poker, provides an excellent example. One of few venues that opened up an online casino after establishing its online poker room, it showcases games from Microgaming, Betfair and other egaming content providers to offer the widest range of egaming options in the business from slots, to baccarat to roulette to video poker. Having separate backoffices and content management systems gives Purple Lounge incredible flexibility. In addition to content providers, it allows Purple Lounge to plug easily into finance partners like Neovia (Neteller) and to publish in multiple languages right from the start. The online casino gateway provides registered users with the opportunity to play a variety of games. The system includes centralised accounting and administration functionality such as client registration and account management tools, a variety of funding methods such as credit cards and online wallets and a multilingual front end. Using the development framework to build Purple Lounges web presence provided ease of integration with many partners all of which could be delivered quickly.

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By having a coherent application architecture in place Purple Lounge's site developers can focus on the company's own business requirements, clear in the knowledge that their solution will remain secure, efficient and scalable. It's just good practice to keep back office systems completely separate from other aspects of an egaming business to facilitate change going forward. Purple Lounge’s expansion into slots games demonstrates this. To keep players engaged, these games change frequently and updating with zero downtime is essential. The key to achieving this goal was ensuring the site had the appropriate architecture right from the outset. VALUE FOR MONEY This is also an important consideration when it comes to costs. In tough economic times keeping control over expenditure can be 'make or break' for an egaming site. It was certainly a consideration for Britain's newest online football pools game. Pools4All.com is an online scores concept based on separate pools of approximately 10 matches for all the English and Scottish divisions and leagues, so people can support their local teams. The company has plans to extend the game to include European games from Germany, France, Holland, Italy and Spain.

The idea was actually born in the Kazakhstan oilfields. For the three founders the work there was hard and the evenings were long and boring. One diversion the trio enjoyed was playing the pools, a betting game based on predicting the outcome of football matches and they tracked everything on a spreadsheet. Before long, they had about a hundred players around the world taking part, and the first iteration of Pools4all.com was born. But getting to the next stage could have been a lengthy and costly proposition. It's a completely new online concept; it's never been done before and could have taken up to a year to build the site using traditional methods. Using a development framework meant time and costs for Pools4all.com were drastically reduced compared to building the site from scratch. It was live in just three months. And for new companies like Pools4all.com, having their web property developed via a mature framework means that the complex security, resilience and performance management needs are built right in. They can take comfort in knowing the best practice standards, compliance with data protection and accessibility legislation are inherent. A PLACE TO CALL HOME With current economic conditions, keeping an eye on costs and value is important to all egaming operators, not just start

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>> IN TOUGH ECONOMIC TIMES KEEPING CONTROL OVER EXPENDITURE CAN BE 'MAKE OR BREAK' FOR AN EGAMING SITE. IT WAS CERTAINLY A CONSIDERATION FOR BRITAIN'S NEWEST ONLINE FOOTBALL POOLS GAME. POOLS4ALL.COM IS AN ONLINE SCORES CONCEPT BASED ON SEPARATE POOLS OF APPROXIMATELY 10 MATCHES FOR ALL THE ENGLISH AND SCOTTISH DIVISIONS AND LEAGUES, SO PEOPLE CAN SUPPORT THEIR LOCAL TEAMS…THE IDEA WAS ACTUALLY BORN IN THE KAZAKHSTAN OILFIELDS. FOR THE THREE FOUNDERS THE WORK THERE WAS HARD AND THE EVENINGS WERE LONG AND BORING. ONE DIVERSION THE TRIO ENJOYED WAS PLAYING THE POOLS, A BETTING GAME BASED ON PREDICTING THE OUTCOME OF FOOTBALL MATCHES AND THEY TRACKED EVERYTHING ON A SPREADSHEET. BEFORE LONG, THEY HAD ABOUT A HUNDRED PLAYERS AROUND THE WORLD TAKING PART, AND THE FIRST ITERATION OF POOLS4ALL.COM WAS BORN. >> ups like Pools4All. Using a developmental framework for site construction is an excellent option to do just that, but another important consideration is the jurisdiction that an operator chooses to make home. To get access to the broadest range of markets, it's important to choose a jurisdiction that is named on the UK government's 'white list'. When the UK Gambling Act of 2005 went into effect in September 2007, one of the new laws restricted online gambling advertising to only those companies based in the UK or other countries in the European Economic Area. Countries outside that area could apply for approval to be included on a ‘white list’ of nations that would be allowed to advertise in the UK. Isle of Man made that application and was approved last year meaning the island nation now is recognised as one of the most reputable jurisdictions in the egaming industry. “Our inclusion clearly demonstrates that as well as being commercially and technologically attractive, the Isle of Man has established and maintained good standards of legislation, regulation and probity similar to those required by the UK in their jurisdiction. We have a high threshold on quality,” said Garth Kimber, head of egaming development at the Isle of Man Government's Department of Trade and Industry. “Any egaming business locating in the Isle of Man can expect not only full access to the UK market, one of the strongest in Europe, but also the added benefits of 1.5 percent duty and 0 percent corporation tax. This coupled with the lifestyle and strong record of flotation of companies from the island on the AIM market makes the Isle of Man a ‘must consider’ jurisdiction." As such, a strong community of expert advisers and service providers has developed in the Isle of Man making it a Tier 1 jurisdiction with many excellent specialist software development, legal, accountancy and fiduciary firms available. In addition, the island’s IT and telecommunications infrastructure is world-class with leading-edge fixed and mobile telecoms networks, numerous disaster recovery and hosting facilities and highly-resilient bandwidth connectivity. The Isle of Man government is committed to the on going 64 I Casino & Gaming International

development of the egaming sector and its “can-do” attitude means there is government funding of up to 40 percent available towards costs of relocation, marketing, hardware and software and annual funding of up to 50 percent for training. Other grants are available too. So the options afforded by locating in the Isle of Man are many and varied. And keeping options open is the key to remaining flexible and nimble, both necessary attributes in tough times. CGI

CHRIS GLEDHILL Educated at Manchester University and Cranfield Institute of Technology, Chris gained experience in both systems and general management during the 1980s and early 90s as a business analyst, a line manager and management consultant. He co-founded PDMS in 1993 on the premise that there was a market for business services and systems which focused on a company’s information assets and business goals rather than on a particular software product, delivering business solutions through a project-based approach to software development and consultancy with particular experience in the egaming industry. In recent years Chris has been involved in a number of groups set up to provide advice on government policy in relation to IT, Communications and e-Gaming. He is currently a member of the Isle of Man Government's private sector liaison committee on eCommerce and also a founder member of the Chamber of Commerce IT committee. Chris also is published extensively on both IT and general business issues in UK and Isle of Man media.

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NEW BEHAVIOUR TRACKING INSIGHTS LEAVE NOTHING TO CHANCE BY DAVID EXCELL AND BILL FITZGERALD

The immense real time knowledge that can be accrued, assessed and acted upon at a precise juncture by tracking online gaming behaviour using advanced statistical techniques, is perhaps one of the most significant technological advances for effective, secure and responsible online gaming to be developed in recent years. And the expertise that continues to push those boundaries for the benefit of operators and players is growing unabated.

point was reached where we could consider the question: How can we create a technology that can provide the most searching insight into customers’ online gaming behaviour? And we concluded: Through the application of advanced statistical techniques we could help online gaming companies tackle everything from identifying VIP customers to detecting fraud and supporting responsible gambling. To develop this capability we established a software company focussed on applying world class academic research in advanced statistical techniques to challenges faced by online businesses. The innovative we bring to the analysis of customers’ online behaviour has led to us being selected by leading online gaming operators. We analyse all aspects of each customer’s lifetime interaction with a website (including registration, payment and gaming), track each customer’s online behaviour against their own profile in real time, and immediately flag up any unusual behaviour. The breakthrough thinking underlying this commercial impetus originates in Cambridge University’s Signal Processing and Communications Laboratory which is research group of around 30 PhD students, 10 post doctoral research workers and six academics. Before describing what we and our clients consider to be a distinctively valuable approach to analysing gambling behaviour there should be some explanation of the thinking that has made this technology possible. Our approach is grounded in Bayesian inference, a particular approach to data analytics which views the world in terms of random variables and probabilities as degrees of belief in certain hypotheses that one has about the world. The idea is to use prior knowledge, encapsulated in terms of probability distributions,

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>> “BETFAIR IS A LEADER IN THE FIGHT AGAINST ONLINE FRAUD,” SAYS DAVID EMSWORTH, DIRECTOR OF REGISTRATIONS, PAYMENTS AND FRAUD AT BETFAIR. “BEHAVIOURAL ANALYSIS ALLOWS US TO PROFILE ALL ONLINE ACTIVITY, UNDERSTAND HOW EACH CUSTOMER’S BEHAVIOUR EVOLVES THROUGH TIME AND ACT IMMEDIATELY WHEN ANY ANOMALIES ARE DETECTED. FEATURESPACE’S TECHNOLOGY IS CENTRAL TO OUR APPROACH.” >> to update one’s degrees of belief once data becomes available. This approach enables the data analyst to sequentially learn as new data is generated available and quantify uncertainties associated parameters of the data model. It also allows the optimal model to be selected that best describes how the ‘world’ works and it also has the ability to classify data into different classes – which forms the basis of ‘machine learning’. Bayesian inference is applied to many areas of signal and data modelling, nonlinear signal processing, image processing, restoration and medical imaging, extreme values statistics, bio-informatics, data mining and data classification, the statistical modelling of communication channels, anomaly detection, tracking methods for time varying systems, and decision theoretic methods. Over the years many novel approaches to statistical methodology and applications areas have been developed and Cambridge continues to push the frontiers of the subject. It is always exciting and stimulating to see this work used to solve real world problems. A particular Bayesian inference research project led us to realise the huge potential of human behavioural analysis. The project demonstrated that when individuals are identified on video, understanding their intent and highlighting unusual activity is vital to ensure CCTV control rooms remain efficient. The extrapolation of this research to the online world has become the cornerstone of our software. The attraction of this area for us derives from the understanding that applying the cross disciplinary skills within psychology and statistical data analytics to rich data sets allows interesting insights into human phenomena to be observed. The application of this research in a business context has happened quicker than expected, driven by particular business challenges brought to us by online gaming companies. We are focused on applying human behaviour analysis in an online context. It is no coincidence that our early successes have been in the world of online gaming. The rich set of interactions found in online gaming makes this industry a good candidate for online behaviour analysis. Better still, it’s an industry which is growing rapidly with an array of increasingly sophisticated companies striving to take their products to the next level. We join an illustrious group of technology companies originating from Cambridge. A notable example is Autonomy, the UK's largest software company by market capitalisation and a FTSE 100 member. Indeed, founder and CEO Mike Lynch OBE, a Fellow of Christ’s College, Cambridge, gained his PhD in mathematical computing in our Signal Processing and Communications Laboratory and is now a member of our board of directors. 66 I Casino & Gaming International

Cambridge offers a wonderful ecosystem for technology start-ups, bringing together a high concentration of bright graduates, world class research, a well organised business network and excellent business facilities. Each generation of technology start-ups helps spawn the next. Our company has benefited from all these elements. For example: members of the Cambridge Network (a networking organisation for business people and academics working in technology fields in the Cambridge area) and members of the Cambridge Angels (a group of successful entrepreneurs who provide business angel investment and other support to young technology companies in the Cambridge area) have helped find key advisers and senior employees; PhDs have successfully transitioned directly from Cambridge Research Laboratories to our company team; and we receive valuable board level advice from Mike Lynch. The connection with Cambridge University really helps: There is constant interplay between academic research and real world business problems. In recent years around 25 percent of UK Venture Capital investment has been with ‘Cambridge Cluster’ companies. The Judge Business School in Cambridge has estimated that there are over 250 active technology start-ups with direct connections to the University. Our modern office is only a short walk away from the University – founded in 1209 – which is currently celebrating its 800th anniversary. Not surprisingly, there is a lot of traffic between the office and the University and the physical proximity reflects the close working relationship. The company started in humble surroundings – in a garden shed converted to a small office. One of our first clients was an online gaming site allowing customers to compete for money within highly interactive First Person Shooter games. We successfully implemented a many-player ranking system as existing two-player ranking systems were inadequate. The company’s ranking system successfully matched rival players with similar skill levels or handicapped individual players to ensure a level playing field. This led on to the implementation of a behaviour analysis based cheat detection system. We have gone on to do further work with online skilled game websites, including delivery of a bot detection system for the world’s largest online skill game operator. Here our software is able to discriminate between genuine (human) players and cheating (bot software) players by learning the characteristics of human interaction and detecting the anomalous bots. The cheats who try to gain unfair monetary and other advantages by using bot software are detected before they damage the reputation of the skilled game operator. For many online gaming operators, the detection and

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prevention of fraud is based on monitoring account deposit and withdrawals, checking customer black lists and hot card lists, identification of IP addresses which can, if required, be blacklisted, and payment gateway identification. Whilst these can be effective to some degree, they share a number of weaknesses. First, they are static operations which quickly become predictable for all but the most inexperienced of fraudsters. Second, they are generally concentrated at the start of the customer life cycle and not throughout the entire life span. This inevitably leads to fraudsters slipping through the net once they have made it through registration. The company’s behaviour analytics approach adds an extra dimension to fraud detection. The software is a particular application of machine learning: for example, the software learns as individual players’ normal behaviour evolves through time and automatically adapts as new scams unfold. Having a statistical framework for describing customer interaction allows deviations from the individual’s behaviour or the known behaviours within the global customer base to be quantified. The changes measured by our technology allow high risk behaviours to be flagged immediately to the risk or security teams. By automating this process gaming operators can reduce the size of monitoring teams and redeploy the staff into more general investigative roles. By increasing human resource in fraud investigation operators can ensure that customers are only contacted when there is increased certainty that intervention is required. A particular application of our behavioural analysis software is pinpointing suspicious withdrawals from online gambling accounts. The traditional rules-based approach adopted by companies is to set a limit above which an alert is sent to a fraud analyst. For major operators this results in a flood of alerts. Most are associated with known big spenders and are generally quickly dismissed as ‘false positives’. So when an irregularity – say a $50,000 withdrawal from an account where withdrawals are usually in the range $5,000 to $10,000 – occurs in a known big spender’s account, it can easily slip through. Likewise the regular small transactions are also monitored for sudden changes. Behavioural analysis, through tracking each individual’s behaviour and learning as this behaviour evolves, is able to highlight the anomalies. In practice, online operators are usually interested in increasing the productivity of fraud analyst teams. Our software helps to minimise routine manual tasks and free up more time to focus on complex cases by reducing false positives and increasing auditability. Our behavioural analysis approach is applied across the range of online gaming options including sports betting, poker, casino games and skill games. Examples of how the approach is applied in online poker include: identifying when different people are using the same account and when the same person is using multiple accounts by building detailed fingerprint-like profiles of each player; exposing collusion, chip dumping and money laundering by highlighting suspicious in-game behaviour. Whilst behavioural analysis is the core of solutions delivered by us, a range of complementary techniques may also be used. For example, at the point when a new customer registers on an online gaming website (i.e. before any behavioural profile has been built), we draw on a wide range of data to classify the customer. Examples of the data used include: patterns within the registration information entered,

the source of funds, initial transactions and product usage. Betfair, the world's largest Internet betting exchange, is one of our clients: “Betfair is a leader in the fight against online fraud,” says David Emsworth, Director of Registrations, Payments and Fraud at Betfair. “Behavioural analysis allows us to profile all online activity, understand how each customer’s behaviour evolves through time and act immediately when any anomalies are detected. Featurespace’s technology is central to our approach.” The online gaming industry both reflects and drives rapid technological and social change. The growth of online gaming is fuelled by technological advances such as the proliferation of broadband communications and mobile devices and also by inter-related social trends such as the shift from off-line to online leisure pursuits, especially amongst the younger generations, and the blurring of work and leisure time in our ‘always on’ world. Online gaming operators in turn help drive technological change (e.g. raising the bar in online fraud detection) and also social change (e.g. improving sporting integrity standards). We are at the centre of this, both benefitting from existing trends in online gaming (e.g. increasingly data-rich online customer interactions feed the company’s analytical engines) and contributing to technological advances (e.g. offering state-of-the art analytics on a commercial footing via its scaleable software platform which is capable of processing massive volumes of transactions per day). For the great majority of players, online gaming is simply an engaging form of relaxation. For a minority, however, there is a darker side. Our white paper, Online Gambling: An Evaluation of the Elements of Social Protection and Criminal Protection (January 2009), reviews both social issues (e.g. problem gambling, under-age use) and also criminal behaviour (e.g. money laundering, identity theft, bot gaming) which may be associated with online gaming. Whilst there are some situations where an online environment enables undesirable behaviour (e.g. bot gaming), the main impact of transitioning from off-line to online is to permit technology to be applied to the detection (and even prevention) of undesirable behaviour (e.g. a problem gambler is much more Casino & Gaming International I 67

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>> OUR SOFTWARE IS ABLE TO DISCRIMINATE BETWEEN GENUINE (HUMAN) PLAYERS AND CHEATING (BOT SOFTWARE) PLAYERS BY LEARNING THE CHARACTERISTICS OF HUMAN INTERACTION AND DETECTING THE ANOMALOUS BOTS. THE CHEATS WHO TRY TO GAIN UNFAIR MONETARY AND OTHER ADVANTAGES BY USING BOT SOFTWARE ARE DETECTED BEFORE THEY DAMAGE THE REPUTATION OF THE SKILLED GAME OPERATOR. >> likely to be identified in an online environment). Operators are investing in social responsibility programmes and technology providers are developing software which detects and reduces the prevalence and effects of undesirable online behaviour. Our behavioural analysis approach, for example, is being called upon to help responsible gambling initiatives. The ability to track an online gambler’s behaviour though time, and to immediately detect any divergence from normal behaviour patterns, allows operators using our software to act early to protect both customers’ and the operators’ interests. For example, the software has proved highly accurate in giving early warning of customers who are heading towards self-exclusion. The applications of behavioural analysis in online gaming are much broader than the detection of cheats, fraudsters and problem gamblers. Our statistical analysis of human online data patterns delivers deep insights into online customers' motivations and preferences which can be used by online operators to capitalise on revenue opportunities such as: • •

•

increasing acceptance rates (e.g. by increasing accuracy of fraud detection) increasing conversion rate of ‘play’ money customers to ‘real’ money customers (e.g. optimise content and timing of promotional messages) identification of cross-selling opportunities (e.g. highlighting which out of those who bet on UK Premier League football who are most likely to also be interested in betting on South American football, or highlighting which skill game players are most likely to also be interested in playing poker, so that marketing messages and promotions can be efficiently targeted) increasing retention rates (e.g. by using accurate early identification of at risk customers to focus retention campaigns) identification of VIP clients early and accurately (e.g. so that VIP programmes are optimally deployed).

By utilising our technology operators can provide a personalised experience. This is particularly important as the number of products available continues to expand. By increasing the relevance of the customers experience operators will see an increase in the long term revenue per customer. Looking to the future, we plan to stay focussed on working with the online gaming industry and we see tremendous opportunities in online gaming: This is a fast growing market with many well-funded companies making investments in sophisticated online operations. We are able to help our clients meet marketing, fraud and social responsibility objectives. Possible regulatory changes – for example in the United States – offer additional upside. 68 I Casino & Gaming International

* Featurespace, the software company founded by David and Bill, combines ‘Feature’, which in the language of pattern recognition refers to an individual measurable property of the phenomena being observed (e.g. the trajectory of hands, elbows and shoulders of a person walking down the street or the amount and rate at which customers transfer money in and out of their accounts) and ‘Space’ meaning a set which has some structure.

DAVID EXCELL AND BILL FITZGERALD David is from Canberra, Australia. After gaining a Bachelor of Engineering and a Bachelor of Information Technology at the Australian National University, he won a place as a PhD student in the Signal Processing and Communications Laboratory in the Department of Engineering at Cambridge University. His research concentrated on automated methods of understanding human behaviour. These ideas have become the cornerstone of Featurespace technologies. David has over twelve years experience working in research commercialisation and software development. He has been awarded over 10 prizes and scholarships for his academic achievements. David co-founded Featurespace with Bill Fitzgerald and serves as CEO. Bill is Professor of Applied Statistics and Signal Processing at Cambridge University. He is also Head of Research in the Signal Processing and Communications Laboratory in the Department of Engineering and a Fellow of Christ’s College. His work centres on Bayesian inference applied to signal and data modelling. He is also interested in nonlinear signal processing, image restoration and medical imaging, extreme value statistics, bio-informatics, data mining and data classification. A large part of his work involves change and anomaly detection with applications to security and fraud. He has also worked in Neutron Scattering at the Institut Laue Langevin in Grenoble, France and as a Professor of Physics at the ETH in Zurich. Bill co-founded Featurespace with David Excell and serves as Chairman.

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DETERRENCE AND MANAGEMENT: FRAUD, RISK AND RECESSION

BY ANDRÉ EDELBROCK

The idea of risk and reward runs through much of our daily lives but is pivotal to the incentive that drives the gambling mind. The customer takes their chances in the hope that risk will yield disproportionately positive rewards. It’s a mechanism that has benefited the industry very nicely so far. However, there is another group who take a similarly motivated gamble on their own terms: the fraudsters.

n the case of a casino, many technological breakthroughs have been applied to combat the threat from fraud, but it’s still the underlying strategies deployed which are most important in the efficacy of prevention. Even the most recently developed and sophisticated systems will not achieve their potential if not employed in a meaningful manner. It’s the same with online fraud but in many ways, the challenges faced in the customer-not-present (CNP) scenario are much increased. The digital age has been empowering but that sword cuts both ways. Open all hours and able to cater to near limitless audiences simultaneously, online casinos present an opportunity for digital customer conversion that few other industries enjoy. Alongside this, the current economic decline presents a time where the efficiencies of online operation are more appealing than ever. Initially, the greatest challenge faced by any business regarding online fraud was the simple lack of information about customers. Without multi-layered approaches consisting of technologies such as address verification, identity authentication systems and IP geo-location, the only real identifiable information that could be attached to a transaction related to card numbers. These days, a wealth of criteria are being used to screen orders, with sophisticated algorithms used to create a risk score based on attributes such as location and the number of chargebacks. A unique issue arises for online casinos in how to apply this sort of information. Gamblers are spontaneous creatures of convenience, and when they want to place a bet on their team, it is often in the last minutes and spurred on by rivalry with friends. If an egaming site slows them down, they’ll either go elsewhere, or not bet at all; and while that’s almost always true

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>> THROUGH THESE COMMUNITIES, FRAUDSTERS NOW HAVE ACCESS TO A LIVING, BREATHING WIKIPEDIA-STYLE WEALTH OF INFORMATION ON HOW TO USE THE TOOLS AT THEIR DISPOSAL AND MORE IMPORTANTLY, WHEN AND WHERE TO STRIKE TO ENSURE MAXIMUM SUCCESS. ONCE A WEAK TARGET IS IDENTIFIED, ITS VULNERABILITY IS FLAGGED TO THE SWARM. AMONGST THE OTHER CONSEQUENCES OF THIS IS THE INCREASED BURDEN FOR THOSE WHO HAVE TO SIFT THROUGH ONLINE TRANSACTIONS AND TRY TO DISTINGUISH GOOD CUSTOMERS FROM BAD TO MAXIMISE REVENUES WHILE MINIMISING LOSSES. >>

for sportsbook, it applies to other games of chance as well. Therefore, for egaming merchants, it is of the utmost importance that the user experience remains as quick and convenient as possible. This means manual approvals must be avoided at all costs with the decisioning about fraud or legitimate customer handed over to automated systems to make the right choices. Yet we know that automated decisions are far from flawless. Rule-based algorithms run the risk of either over-leniency, accepting too many fraudsters, or of being overly-strict in tolerance of risk and turning away large numbers of good customers. Because of the high stakes and large amount of cash in play, online casinos usually err on the side of reducing risk, routinely rejecting good customers; a phenomenon rarely seen in most other forms of commerce. With ecommerce presenting such a lucrative target, online fraud is increasingly dominated by organised crime and international cybergangs. An underground economy has emerged in which illegally obtained details are swapped and sold while targets and strategies are disseminated. In the hands of this community of thieves, information is power and collaboration only amplifies its potency. Through these communities, fraudsters now have access to a living, breathing Wikipedia-style wealth of information on how to use the tools at their disposal and more importantly, when and where to strike to ensure maximum success. Once a weak target is identified, its vulnerability is flagged to the swarm. Amongst the other consequences of this is the increased burden for those who have to sift through online transactions and try to distinguish good customers from bad to maximise revenues while minimising losses. Fraud is a recession-proof industry. It prospers in good times and bad, but the evidence suggests that while the rest of the economy is in decline during a recession, fraud enjoys a ‘boom’ phase for growth. Because of the low barriers to entry and abundance of soft targets on the web, CNP fraud is a tantalising prospect to the recent swathes of unemployed. In the case of egaming sites, the appeal of the fraudulent gamble may hold the greatest attraction due to the large rewards that are on offer. All this adds to the already significant threat that the industry faces and bolsters the importance of effective fraud prevention policies that focus on the Total Cost of Fraud: direct losses + deterrence and management costs + lost revenues. When budgets are pushed, security is not an area that can be neglected. What starts as a crack in the hull of a 70 I Casino & Gaming International

business can grow with distressing ease to become an overwhelming threat. In the case of fraud deterrence, there is no silver bullet, and just spending more or keeping your security budget in tact is not enough to keep that crack in the hull from forming. In line with advancing technology, fraud is becoming more sophisticated and richer in nuance; and fraudsters are evolving even more quickly. Why are they able to outwit even the best technology and most up-to-date processes we have to throw at them? However we examine it, at the heart of the problem lie one inescapable and central issue around which all else must revolve: Unfamiliarity. The fact of the matter is there’s really no way of knowing with certainty whether a transaction from an unfamiliar customer is safe to process or not until it’s too late. And that’s a threatening prospect. Fraudsters work 24x7 with one purpose in mind. To blend in. To look exactly like a legitimate customer. To know how your systems work, what questions they'll be asked, what thresholds they must pass to escape detection, and where even the tiniest vulnerabilities are. Some merchants have even noted that fraudsters often do a better job of inputting the correct data and looking honest than legitimate customers. But what if there was a way of gaining ‘familiarity’ based on the experiences of your peers. What if you had the insights of a community at your disposal, much like the small village of yesteryear where everyone knew everyone, and merchants swapped stories of who is unreliable, who pays their bills and who repeatedly returns merchandise? In this milieu, your reputation precedes you and every merchant knows who to trust, even if you've never entered their place of business. The internet, the same tool that enables fraudsters to hide in anonymity, offers merchants a way to make the world small again and regain the familiarity of the village that we lost as cities and businesses got ever larger over the past century. Just as Facebook, the business network LinkedIn, and other social networks have created opportunities for individuals who've never met to exchange info, help in a job search or ask questions, a community of online businesses using their combined strength and knowledge against fraud would be formidable. A network spanning all types of business selling online from egaming and retail all the way through to travel and online dating, that erases the cloak of anonymity for both fraudsters and good customers. The Global Fraud-Fighting Community offers just such a proposition. Members contribute historical and continuing

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transaction information to a central repository. New transactions are matched, linked, analysed and scored in real time against the pooled data of the entire community. Importantly, like the village, once the untrustworthy are identified, they’re flagged as a threat to all and their crime spree is halted. Alone and isolated, each business possesses an unlinked silo of information bereft of context. Together, they possess a 360-degree view of customers’ online behaviour from which they can assess trustworthiness, and make better decisions that reduce fraud losses, and reduce the cost of managing and deterring fraud. Vitally, this perspective is constructed in real time, giving members instant recognition of otherwise unidentifiable individuals. But it’s easy to forget the other side of fraud management. Perhaps most importantly, positive transactions are weighted by the community as well, ensuring that good customers aren't mistakenly rejected, and that they have a chance to become valued and loyal customers. Of course, customer goodwill is hard to quantify, but the increased revenues you get because you stop turning good customers away are not. Most businesses that operate online incorrectly reject up to six percent of orders due to ‘false positives’ in the screening process, and some turn away even more good business. How much would you have to spend in marketing dollars to attract six percent more customers, or said differently, to increase your revenues six percent? And then there’s the future business that is as good as permanently lost. How likely do you think a good customer is to return if your site refused their custom the first time? Nothing can be worse for customer relationships than to nip them in the bud just as they are flowering. There is an interesting side question in all of this. Some have asked "Why would I want to collaborate with my competitors?" We could just as well ask whether keeping shop in a safe neighbourhood is beneficial for business. Yet, to keep the streets of a neighbourhood safe, the merchants that operate there need to work together, maintaining clean, bright shops, ensuring the streets are well-kept, and watching for and reporting suspicious activities. Similarly, it is to the benefit of all merchants operating online to ensure that the buyer feels safe and secure, and that the costs of crime are kept to a minimum. For large and small alike, consolidation of efforts brings together a united front where competition is not only unnecessary but ill-advised. Contrarily, competitive advantage will accrue to those who choose to belong to the community, contribute to it, and benefit from it. Those who stay on the outside, just as in the real world, become attractive targets for crime as they become the lowest hanging fruit. Rising fraudster traffic to those outside the community magnifies the rewards to be gained from joining. As membership continues to increase, it becomes a virtuous circle and the Global Fraud-Fighting Community becomes more and more powerful in stopping crime. As the central body managing the member-owned pool of data, we ensure security, privacy and data integrity with regular auditing by PriceWaterhouseCoopers. Being a global community with one independent 'governor', members are assured that standards adhere to the highest common denominator – the strictest data regulations and protections in jurisdictions around the world.

The Global Fraud-Fighting Community extends beyond just ecommerce sites to include a range of stakeholders with interests in defeating online fraud. Banks, industry associations, card issuers, alternative payments providers, policing organisations and fraud solution vendors are also partnered with the community to ensure that a range of solutions are available and that all interests are represented. Leading organisations such as RBS and IMRG belong, as do dedicated anti-fraud vendors such as 41st Parameter and Accertify. These relationships bring support and experience to all involved in a way that reinforces the community’s aims and strengthens their means of achieving them. Furthermore, they are a demonstration of the kind of calibre of recognition that the effort has achieved. With the introduction of the internet, a new age of collaboration has dawned. Social networks have sprung up everywhere to connect individuals in all the types of relationships we carry on as people. Parallel networks of organised criminals have also arisen like mushrooms in manure. Now, online merchants have a place where they can collaborate against the criminals to turn the tide. Working together to defeat fraud makes sense, regardless of the economy’s fluctuations. But, with crime on the increase, and cost-control an absolute priority during the recession, it makes more sense now than ever. CGI

ANDRÉ EDELBROCK André Edelbrock, President and Chief Executive Officer, Executive Director Andre Edelbrock is a leading expert in online payment systems, risk, fraud and product management. Before joining Ethoca in 2005, Edelbrock headed the department responsible for all international e-cash services and operations at CryptoLogic (NASDAQ: CRYP, TSX: CRY, LSE: CRP), one of the world’s largest e-gaming software and e-cash service providers. Edelbrock also spent two years with Procuron, an Internet B2B marketplace start-up founded by Bell Canada, CIBC, Scotiabank and Desjardins, where he played a key role in strategy, development and sales. Earlier in his career, he served as a management consultant at the Canadian offices of Deloitte Consulting and IBM. Edelbrock holds an Honours Bachelor of Science degree in Systems Design Engineering from the University of Waterloo.

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WPC has moved! Now co-located with EiG in Copenhagen Lead Sponsor and Badge Sponsor

World Poker Congress 2009 17th September – Copenhagen, Denmark World Poker Congress is the only conference and exhibition tackling the business of poker from all perspectives; from the live poker table and tournaments to online versions and innovations.

WPC is perfect for: • Developing and implementing poker into a profitable business model

• More industry experts in one place; joining and enhancing the huge number of industry experts, speakers and afﬁliates that will be in Copenhagen for EiG • Cost effectiveness; in these times of keeping a more watchful eye on travel costs and expenses, co-locating provides great savings

• Maximising crossover potential between live and online poker businesses • Networking with senior executives from the poker industry including tournament directors and the operators of major poker brands For more information regarding delegate sales, contact: Sam Barrett – sam.barrett@clariongaming.com

Beneﬁts of co-locating WPC with EiG:

• More networking and information gathering than ever before!

For more information regarding exhibition and sponsorship sales, contact: Brian McDonald – brian.mcdonald@clariongaming.com

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Clarion Gaming co-locates the World Poker Congress 2009 with EiG 2009 in Copenhagen Clarion Gaming has announced that the World Poker Congress (WPC) will be co-located with the European iGaming Congress and Expo (EiG) in Copenhagen, Denmark on the 17th September 2009. This co-location will increase and enhance the huge number of industry experts, speakers and affiliates that will be in Copenhagen for EiG, benefiting the audiences of WPC and EiG respectively, while retaining WPC's own identity and specific focus. Among the line-up of speakers, Steve Lipscomb, CEO and Founder of WPT Enterprises, commented: "The World Poker Congress is simply not like other conferences. In attendance are the decision makers from the most exciting companies in the poker arena – and they are there to do business. Online sites find casino partners in emerging territories and everyone is remarkably open to sharing industry perspective.” Further support for the conference is provided by recent past delegates: "Great networking, excellent chance to meet top poker people." - Paul Barnes, CEO, Devilfish Gaming PLC "The World Poker Congress is the best opportunity to meet the right people from World Poker Community." - Stefan Svec, Head of Poker & Casino Dept., Doxxbet Ltd. "Attending and participating at the WPC has become vital for our business to keep track with the international community as well as meeting the key players in the poker world. The WPC has a unique and intimate atmosphere for networking with the right people to do good business." - Tamas Nador, Executive Producer, Poker Media Ltd. "It's really interesting to meet colleagues from all around the globe, I believe all continents were represented. That gives you perspective." - Christer Larsson, Pokerevent.se All major operators should attend to keep their market edge and learn how to take advantage of major trends; These include tie-ups with live poker, achieving liquidity and offering effective loyalty programmes. For further information or the most up-to-date line-up of speakers, please visit www.worldpokercongress.com/2009

Come and visit us @ EIG Copenhagen

sales@playtech.com w w w.playtech.com

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STOCK TAKE: OPPORTUNITIES TO ADDRESS AN INCREASINGLY LARGE BASKET OF TRICKY QUESTIONS BY CLIVE HAWKSWOOD

The UK Government’s impending review of its gambling policies since it first announced its intention in April may be heading for a quagmire of complex regulation and tax moves affecting gambling industry competitiveness. But the fact that it is being undertaken barely two years after the new regulatory and licensing system came fully into force in 2007, suggests there is a fundamental reassessment underway of its position in the first place.

he famous French saying that ‘The more things change, the more they stay the same’ could have been coined for the remote gambling industry in the last year or so. Around the world governments and legislators, even though they frequently have different motives, are focusing on online gambling. At the end of April, the British Government announced that it was to undertake a ‘stock take’ of its policies relating to remote gambling. The remit of this review by any other name is still very vague and, at the time of writing, the Department for Culture, Media & Sport (DCMS) was still in discussion with other departments about its terms of reference. However, in the words of DCMS, the overall aim is to ensure that, as much as possible, a level playing field exists between onshore and offshore operators. That is all very broad brush stuff, but specific mention has been made of some issues and so we can at least be sure that they will be covered. The three of note are advertising; support by offshore companies for problem gambling related research, education and treatment (RET); and the possible extension of the horserace betting levy to offshore bookmakers. It is no coincidence that each of these subjects has been raised with the Government by special interest groups and opposition politicians over a period of many months and there is no doubt that this ‘stock take’ will provide both the opportunity and breathing space to address an increasingly large basket of tricky questions. Bearing in mind that the new regulatory and licensing system only came fully into force in 2007, such an early review must imply that the government has lost confidence in a number of its key policies or that more fundamentally they were wrong in the first place.

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>> THERE IS CERTAINLY NO ENCOURAGEMENT TO BE GAINED FROM [THE GOVERNMENT’S] RECENT HANDLING OF BINGO TAX WHERE ONLINE BINGO REMAINS AT 15 PERCENT GPT BUT BRICKS AND MORTAR HAS BEEN SADDLED WITH A 22 PERCENT GPT…THEIR REASONING SEEMS TO BE THAT THEY REDUCED THE TAX BURDEN ON THE BINGO INDUSTRY IN OTHER AREAS AND THAT THIS WAS A BALANCING EXERCISE, BUT THE BINGO INDUSTRY IS UNDERSTANDABLY UP IN ARMS AND IS ADAMANT THAT THEIR OVERALL TAX BURDEN HAS INCREASED AS A RESULT. THE TREASURY INSISTS THIS DOES NOT SET A PRECEDENT, BUT IN TIME OF RECESSION THERE ARE MANY IN THE WIDER BRITISH GAMBLING INDUSTRY WHO FEAR THEY MIGHT BE IN FOR SIMILAR TREATMENT IN FUTURE YEARS. >> As a minimum it is reasonable to suggest that their problems have arisen because of the Government’s failure to attract online gaming businesses to the UK and the slow emigration of several online betting operators offshore. Nothing is ever completely straightforward, but everyone knows – including the Government – that this is a result of the uncompetitive UK tax regime. In 2005 and 2006 when this was a live issue the industry went to great lengths to explain what it would take for the UK to become a viable jurisdiction for online gaming companies to base themselves in. For reasons which have never become clear HM Treasury opted for a 15 percent gross profits tax rate for online gaming which, combined with Corporation Tax and VAT, made the UK a no-go area for any company with real aspirations of competing in the international online gaming market. That is all in the past now and although it will be interesting to see if tax is allowed into the review exercise it is worth remembering that the Government went into this with its eyes open in the sure knowledge of what would happen if they pitched tax at too high a level. In other words, if there are any difficulties from a governmental perspective then they are ones of its own making. There is certainly no encouragement to be gained from their recent handling of bingo tax where online bingo remains at 15 percent GPT but bricks and mortar has been saddled with a 22 percent GPT. One of their stated reasons for having an online gambling tax of 15 percent was to make it consistent with areas like betting tax. There does then seem to be a lack of logic in three years later increasing GPT for one sector. Their reasoning seems to be that they reduced the tax burden on the bingo industry in other areas and that this was a balancing exercise, but the bingo industry is understandably up in arms and is adamant that their overall tax burden has increased as a result. The Treasury insists this does not set a precedent, but in time of recession there are many in the wider British gambling industry who fear they might be in for similar treatment in future years. Anyway, if one issue is at the heart of this review it is probably advertising where Gerry Sutcliffe, the British Minister for Sport, announced that: "Now is the right time to take stock of developments in Europe and elsewhere to make sure our regulatory system is as fair and robust as possible for all operators able to advertise in the UK". It should go without saying that all advertising in the UK, 76 I Casino & Gaming International

irrespective of whether the advertiser is on or offshore, is subject to the same web of regulations ranging from statutory controls overseen by OFCOM and the Gambling Commission to the non-statutory codes of the Advertising Standards Authority and the gambling industry. It follows that the review’s attention will not be so much on the content of adverts, but rather on the probity of the advertisers. In a nutshell the question will be: Is it safe to let consumers see adverts from non-UK licensed companies? In seeking to answer this question the Government will draw a distinction between those operators licensed in EEA states and those in White List jurisdictions. For the former there are issues of EC law. Although those laws may not be respected by all EEA jurisdictions, the UK’s approach has always been that it would be in breach of EC law if it sought to bar advertising from other Member States. This is because they would, in effect, be putting up trade barriers to prevent competition from elsewhere in the EEA. There are legal justifications that can be relied upon for taking such action, but they would be very difficult to establish in relation to, for instance, Gibraltar. This position has been reiterated several times and, for example, the Explanatory Memorandum for The Gambling Act 2005 (Advertising of foreign gambling) (Amendment) Regulations 2008 states: “To ensure compliance with the UK’s European Community obligations there is no blanket restriction on the advertising of gambling which takes place in, or originates from, an EEA State.” In these circumstances it is probable that it will be the White List jurisdictions that will be the first in the review’s sights. There have been two recent Parliamentary debates where the white-listing system has been heavily attacked and where DCMS has been on the back foot. The addition of Antigua to the list prompted the strong criticisms, especially from Tobias Ellwood, the Opposition spokesman on gambling. The recent scandal involving Antigua based businessman Sir Allen Stanford could hardly have come at a worse time and many politicians specifically cited him as an example of Antigua’s poor regulatory record. In political terms the White List system as it currently operates might have been fatally holed below the water. One alternative that may be considered is to move to a different model whereby individual companies are placed on a list rather than jurisdictions. This would be something of a

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slap in the face for the jurisdictions and it would be interesting to see what the Gambling Commission could divine from direct relationships with the companies that they cannot presently get from regulators. This would amount to some form of license to advertise, but it is hard to think what criteria would be applied or how the Gambling Commission could properly police companies based in other jurisdictions. It might help to fill any spare capacity at the Commission, but it could easily put them in an awkward position where they will be called on to fulfill certain regulatory functions involving companies all around the world. In theory this could be made to work if the companies were based in relatively few jurisdictions and if the authorities in those jurisdictions were minded to be co-operative, which in many cases they are likely to be if the alternative is that the companies in question consider relocation. It is probably true that in practice the relationship would be a direct one between the company and the Gambling Commission and so there would be little call for local regulators to become involved. However, under this dual regulatory approach it would clearly make sense for them to work together to minimise repetition, workload and cost. One aspect of this that would cause considerable concern in the industry is the precedent that it sets. After all the Gambling Commission is not infallible and nor does it have a monopoly on good regulation. There would be nothing to stop every jurisdiction adopting a similar approach. If, somehow, this could be justified under EC law then it would open the floodgates to a bizarre regulatory nightmare where every regulator felt empowered to judge the regulation in every other state and where operators would need an array of licenses, some of which could easily end up being contradictory. A simpler and, for Government, perhaps a more attractive variation on this would be to have a license to advertise which would be dependent on companies making appropriate donations towards problem gambling related research, education and treatment. Many offshore companies already help fund the Responsibility in Gambling Trust (RIGT) and as long as the figures are not disproportionate then formalising the process will not lead to complaints from those UK-facing companies in Alderney, Gibraltar or anywhere else. All companies that advertise in the UK are subject to the same advertising rules and codes of conduct. This is true whether they are on or offshore. So such a measure would not have any effect on the content of the advertisements, but it would ensure that all offshore companies that advertise are funding those consumer ‘good causes’ on the same basis as British-based companies. For completeness, I should refer to the horserace betting levy. In short this is a compulsory statutory levy under which British licensed betting operators pay a sum to the British Horserace Betting Levy Board for it to apportion as it sees fit for the benefit of the British horseracing industry. The amount is currently 10 percent of the gross profits made on British horseracing. Racing wants offshore bookmakers to contribute too. However, after stripping away all of that background, we are left, plainly and simply, with a hypothecated tax. It is understandable that the Government should want to placate elements of the British racing and betting industries, but it

really is inconceivable that any Government could impose a tax of this kind extraterritorially. If nothing else, reciprocal action from other jurisdictions could decimate the British industry. Logic and law would suggest that the only real lever that the Government has is, again, advertising, but there is a world of difference between asking offshore companies to make a reasonable contribution towards good social responsibility causes and bending their arms to pay 10 percent of their gross profits on horseracing. To suggest that as a solution would be to overestimate the importance to offshore betting operators of both horseracing and advertising. As for timing, we have been advised by DCMS that this stock take could run until the end of the year and, depending on its findings, there might be a period of consultation after that. Skeptics might suggest that this sort of timetable would mean that any eventual action points would be kicked into the political long grass by the General Election that is due in 2010. Notwithstanding that, the announcement of the stock take-cum-review has set many hares running and DCMS will find it hard to round them all up. The industry is very well aware of the complexity of these issues and, as the remit is still to be finalised, it could become even more complicated. We look forward to working with the Government as the process progresses, but no one should be in any doubt about the legal, political, and diplomatic minefield that DCMS is stepping into. CGI

CLIVE HAWKSWOOD Clive Hawkswood has been Chief Executive of the Remote Gambling Association (RGA) since its establishment in August 2005 following the merger of the Association of Remote Gambling Operators (ARGO) and the interactive, Gambling, Gaming & Betting Association (iGGBA). Before that he was the General Secretary of ARGO. Clive was formerly head of the Betting & Racing Branch at the British Department for Culture, Media & Sport (DCMS). Prior to that, he was at the Home Office, spending time in both the Gambling Section and the Horseracing Policy Team. Earlier in his career he spent several years working in the bookmaking industry. He is also a Director of the Responsibility in Gambling Trust (RIGT), the British charity that raises and allocates funds for problem gambling related research, education, and treatment.

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Staying ahead of the game – with the next phase of MTGM Senior gaming consultants from Elektroncek explain how operators can benefit from Interblock advanced multi-game solutions on electromechanical and video gaming machines.

Introduction A true achievement in development is Elektroncek’s 4th generation of gaming devices sub-branded ‘G4 Organic’.

The new generation stands out and includes G4 Organic Card Blackjack – the first electromechanical gaming device enabling genuine game experience with real cards. There is no comparable machine on the market, with competitors limited to machines which display cards on a video screen. Elektroncek’s innovation filled a niche, and announced a new path for development of multiplayer gaming machines – electromechanical solutions for traditional live games.

The gaming machines are modular, which means they are comprised of two completely independent units: the centre unit and the play station and as such offer a VARIETY OF CHOICES IN GAMES, SHAPE, and DESIGN AND FUNCTIONALITY. The number of casino floor’s square metres has always – in the first place – determined how broad its offer of the multiplayer games was. Nowadays operators have a chance to broaden the game portfolio and so answer players’ game preferences instantly.

The multi-game platform means that the player can for the first time enjoy an environment in which he can choose his game at the flick of a switch from any offered by the venue. A multi-game environment builds revenues for the owner, whether it is a full-scale casino or a small arcade – and most of the European arcades are limited by size rather than by the number of stations which they may be permitted.

The summit of the multi-game MTGM (Multi-Terminal Gaming Machine) system is the ‘multi-centre’ unit, which is made of multiple individual centre units. Each of those center units has its own game running on it, and is in all aspects completely independent from the other units. The play terminals, situated around the ‘multi-centre’, are connected to all centre units simultaneously via LAN connection through a network switch, allowing the player behind the terminal to connect to the type of game of his choice.

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The Multigame platform is stable, Twins is just one of the products which represented this platform and it is GLI approved. • Games that can be connected to the Multi-game platform, because the game does not limit the number of players: Double zero roulette (video and mechanical), Single zero roulette (video and mechanical), Sic-Bo (mechanical), Keno (mechanical), Baccarat (video) • Games with a player limitation on the Multi-game platform: Black Jack (video and mechanical) – game only allows up to 7 players/stations

This briefly described solution is based on a modularity of a G4 Organic gaming machine, which is comprised of two completely independent units (the centre unit and the play station) and as such offers a VARIETY OF CHOICES IN GAMES, DESIGN, SHAPE AND FUNCTIONALITY. This is the core advantage of G4 Organic Multi-centre.

The multi-game principle allows players to individually choose the game they wish to participate in on the play terminal, which can be connected to multiple centre units simultaneously. Players can choose the game from a wide list of games offered by Interblock: ROULETTE, SIC-BO, JOKER SIC-BO, FISH-SHRIMP-CRAB, KENO, AND VIDEO GAMES; HORSE RACE, BACCARAT, BLACK JACK. The principle does not limit the choice to only the central units in direct proximity of the play terminals. The terminals can also be connected to another G4 organic gaming machine, situated in a different room or floor, which further expands the choice of available games for the player.

G4 Organic Multi-game system has been lately installed at the popular Portuguese Casino Lisboa.

“It was a personal bet for something new and exciting that would offer even more diversity of machines at Casino Lisboa. It has proven to be a success not only by the results but also with the high occupancy rates of the machines. The success is far so positive that it has resulted in the purchase of one more machine with double the terminals and two new games,” said Carlos Campos, Casino Lisboa.

“We were excited to be given the opportunity to create something as new and unique as Multi Station multi game product together with Casino Lisboa!” added Bojan Dreven, regional sales supervisor at Elektroncek.

The implementation of a multi-game system in casino, arcade or any other gaming lounge can also improve the occupancy rate of current gaming machines. Connecting a roulette and dice game in one single gaming machine presents a good example of a smaller (small scale) multi-game project.

G4 Organic is a competitive advantage for every casino.

It lets the operators’ imagination go with the possibilities afforded by the Multi-game principle together with colour variations and optional user experience upgrades. The contemporary design enhances both the value and the gaming experience casinos are able to provide to their players.

www.elektroncek.si

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ONLINE REGULATION: UK

ARE WE HEADING IN THE RIGHT DIRECTION?

BY JOHN HAGAN AND MELANIE ELLIS

With the UK Gambling Act 2005 having been introduced just two years ago this September, to what extent is the jurisdiction becoming an attractive online centre for gaming operators; and are there any indications that the tax, licensing and advertising framework of regulation is recognising what is needed to create an environment for egaming growth?

s the two year anniversary of the introduction of the Gambling Act 2005 approaches, we consider the degree to which the UK has become a commercially viable online gambling jurisdiction. Back in 2002, the Government envisaged that the UK would establish a reputation as a world leader in online gambling, but then shot themselves in the foot with the 2007 announcement of a 15 percent gross profits tax. Notwithstanding the prohibitive tax regime, at the time of writing over 600 operators have been awarded some kind of remote licence by the Gambling Commission. This figure is, however, inflated by the large number of ‘ancillary’ licence holders whose remote activities form a small part of their business. Less than 20 licences have been granted for remote casinos, with possibly only a handful of these currently operating. Around 70 licences have been issued for remote general betting, including the major UK high street bookmakers. So far then, the Gambling Commission has not been inundated with floods of operators coming to the UK to be licensed and regulated. Since the 2005 Act came into force in September 2007, we have not seen any major changes to the way online gambling is licensed and regulated in the UK. The tax rate remains stubbornly set at 15 percent. There has been no change to the marketing provisions which remain liberal, at least in theory. For the most part, the Advertising Standards Association (ASA) appear to have been adjudicating on complaints in a fair and balanced way, applying the advertising codes in a sensible manner. From time to time, however, the ASA’s approach has been unduly literal, heavy with political correctness and lacking in a sense of humour. Rulings against operators have tended to be

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>> THE COMMISSION HAS DEVELOPED A MORE COMMERCIAL UNDERSTANDING OF REMOTE GAMING OPERATORS’ BUSINESSES. FOR EXAMPLE, THE DEFINITION OF REMOTE GAMBLING EQUIPMENT HAS BEEN INTERPRETED IN A LIBERAL WAY IN GUIDANCE NOTES, WITH, FOR EXAMPLE, ONLY SYSTEMS USED TO DETERMINE BONUSES AND INCENTIVES DURING THE COURSE OF PLAY FALLING WITHIN THE DEFINITION. THIS ALLOWS OPERATORS LICENSED OVERSEAS TO LOCATE SOME FACILITIES AND STAFF IN THE UK WITHOUT REQUIRING A UK LICENCE, WITH THE OBVIOUS BENEFIT OF CREATING JOBS. >> in relation to advertisements portraying gambling against a backdrop of thrill seeking or reckless behaviour and those portraying behaviour that could be perceived as problem gambling. We must, however, retain a sense of perspective and remember that in many European jurisdictions gambling advertising is not permitted. In terms of the way they are dealing with licensees and issues that arise, we believe the Gambling Commission is heading in the right direction. What we have seen over the last two years is the Commission gaining experience and knowledge, and becoming more confident in dealing with licence applications and regulatory issues. The Commission has developed a more commercial understanding of remote gaming operators’ businesses. For example, the definition of remote gambling equipment has been interpreted in a liberal way in guidance notes, with, for example, only systems used to determine bonuses and incentives during the course of play falling within the definition. This allows operators licensed overseas to locate some facilities and staff in the UK without requiring a UK licence, with the obvious benefit of creating jobs. In 2008 a review of fees and licence categories made some concessions to remote operators. The application fees for remote casinos were reduced significantly (but with increases for remote betting and bingo licensees). Notably, for those with revenues up to £5m per year the fee was reduced from just under £30,000 to just under £7,000. In comparison to other online jurisdictions the revised fees do make the UK more attractive for start up operators, for whom the gross profits tax is less of a consideration than licence fees. The sensible addition of a linked gambling software operating licence, available for only £165, recognises that it does not make commercial sense to require a full software licence to be obtained by an operator who is carrying out limited development or maintenance of software, or even just installation of it, for their own use. Within the confines of the system as it stands, the Gambling Commission is working to make the UK a more attractive location for remote gambling operators. With increasing numbers of UK residents gambling online, the Government clearly sees it as its job to ensure that these players are protected, whether they are playing on sites licensed in the UK, licensed overseas or not licensed at all. By restricting marketing activities to those subject to the laws of the European Economic Area (EEA) or white listed states, the Government aims to ensure that UK residents play on well regulated sites. However, it is worth noting that an operator 82 I Casino & Gaming International

need only be subject to the laws of an EEA state, not necessarily regulated or licensed in that state. Without a Europe-wide code of conduct, there are no guarantees about the integrity of operators based in EEA countries. Of course basing operations in a leading jurisdiction with a high standard of regulation, such as the UK, presents competitive disadvantages in comparison to those based in less well regulated jurisdictions (for example the cost of compliance with rigorous standards aimed at preventing gambling by those who are underage or suffer from a gambling addiction). In order to ensure that measures aimed at protecting players apply across the board, it is essential that a level playing field is created for responsible operators. Clearly, the current system fails to achieve this. In addition to protecting UK players, it is also the Government’s role to protect the interests of UK businesses. If a level playing field is not achieved, those operators that are licensed in the UK may well decide to take their businesses offshore. In April, the Government announced that operators licensed in EEA states and white listed jurisdictions may face new requirements if they are to continue to be permitted to advertise in the UK. The Government will explore ways to give UK licensed operators a level playing field to compete with those regulated overseas. It is suggested that these operators will be required to make a contribution towards the cost of regulation and treatment of problem gamblers. As part of the review, the Department of Culture, Media and Sport will also look at the controls that apply to overseas operators, with the aim of ensuring the protections in the Gambling Act for underage and vulnerable members of society are properly upheld. A code of conduct which is legally binding on all those who advertise to the UK may be the starting point. The Responsibility in Gambling Trust has long been arguing for financial contributions from overseas operators and voluntary contributions are being made, most notably from operators licensed in Alderney and Gibraltar. To force all operators to make contributions and comply with high standards would obviously be fairer to those who already do so, but it is unclear how a system of enforced contributions and compliance might be policed. We are not convinced that a level playing field can be achieved unless all operators who wish to market to the UK are required to obtain a licence, although this would represent a major change of Government policy. The UK is such a lucrative market for gambling operators that there is no doubt that those currently licensed overseas will obtain a licence in the UK if that is made necessary.

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Although the Government has reiterated in debates on this issue its commitment to the principles of freedom of establishment and freedom to provide services enshrined in the European Community treaty, it must be considering the new systems of gambling legislation brought in recently in France and Italy. On the one hand the Government has expressed the view that there is no legal basis for banning operators based in EEA jurisdictions from advertising in the UK, but on the other hand it must have in mind the huge tax revenues the Italian Government is generating from operators required to become licensed in the country in order to advertise there. With the recent Schaldermose report endorsing the protectionist stance taken by many European jurisdictions, the UK Government is likely to stand alone if it maintains the position that EEA operators may advertise freely in the UK without obtaining a local licence. Whilst these issues are weighed up by the Government, the white listing process has been suspended. This may be no bad thing. The recent addition of Antigua to the white list has been controversial as some have reservations about whether the standards of regulation measure up to those in the UK. Questions have been raised about the process by which jurisdictions become part of the white list and why their submissions are not available for public scrutiny. When queries are raised about jurisdictions on the white list in this way it undermines the whole system and reduces the kudos associated with being licensed in a white listed jurisdiction. The inequality created by allowing operators subject to different standards of regulation to advertise in the UK provides further fuel for the argument that all operators should be required to obtain a UK licence. Despite these issues, remote gambling operators are for the most part extremely happy with the status quo. Being able to market extensively to the UK market without paying UK tax represents the best of both worlds. The results of the Government review are due by the end of the year, but with a general election on the horizon and concern over MPs expenses continuing, this issue is not a priority for the Government. At some point in the future either Labour, or more likely a Conservative government, are likely to introduce some measures which may put a damper on the current attractive set up for operators licensed in white listed jurisdictions, but we would be very surprised if anything were to happen in the near future. In a recent article Tobias Ellwood, the shadow minister for tourism, gambling and licensing has indicated that a conservative government would require all companies to obtain a licence from the Gambling Commission in order to advertise in the UK. The Tories envisage a British standard kite mark which would enable players to easily see that a website meets high standards of practice. This is presented as a consumer protection initiative and it may be that this is a vote winning policy, rather than something which will necessarily be put into practice under a Conservative government. What, then, is the incentive to be licensed in the UK at the present time? As we envisaged when the Act first came into force, for remote casino operators the only reasons to be licensed in the UK have proven to be for disaster recovery or if there is no alternative due to key equipment being located in the UK (as is the case with some interactive televised casinos). As a general rule, we would recommend licensing in the UK to some start up operators to whom the gross profits tax is yet to be a major source of concern. The fact that fees are assessed

on a sliding scale means that initial costs for smaller operations are far more attractive than, for example, the £70,000 annual licensing fee in Alderney. Some jurisdictions, such as Gibraltar, require licensees to have an existing operation. The Gambling Commission does not have any such requirement and a licence is likely to be granted to a start up operator provided they prove themselves to be fit and proper, have a realistic business plan and the necessary funding. Developments in Europe and even the US in coming years are unlikely to affect the choice of the UK as a regulatory jurisdiction. Unlike the UK, as European countries modernise their gambling laws in the wake of the boom in online gaming, they all appear to be going down the route of requiring all operators who wish to promote their services in the country to obtain a licence. It is almost certain that the USA will take the same approach. Whether the approach of European jurisdictions is compatible with EC law is another question, and, given the speed of decision making in the European courts, one that will only be determined in the fullness of time. The position in the UK has been fairly stable for the past two years, but in the medium term operators should expect to be squeezed as the UK adjusts its legislation to ensure protection for players and a fair deal for UK licensed operators. Whether this is a change in the right direction depends on your perspective, but it is unlikely to be a welcome development for the majority of remote operators. CGI

JOHN HAGAN AND MELANIE ELLIS John Hagan is a partner and founder with Julian Harris of the first ever niche gambling and leisure law firm in the UK, located in the City of London. John qualified in 1993 and specialises exclusively in gambling law. John is an experienced advocate, a frequent and respected conference speaker and a regular contributor of articles to national and international gaming publications. John is a Trustee of GamCare. Melanie Ellis is an assistant solicitor at the firm. After graduating from Oxford University in 2003, Melanie qualified as a barrister before joining Harris Hagan in 2005 and retraining as a solicitor. Melanie has advised major casino operators, online operators and start up companies on issues relating to land based and online gambling, establishing operations in the UK and offshore and advertising gambling in the UK.

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COPENHAGEN

2009

15-17 SEPTEMBER

Recession, regulation and retention to dominate the industry’s agenda Ewa Bakun, Clarion Gaming The iGaming industry is no longer an emerging industry; it has transformed into a fully established, regulated and highly competitive sector, with a growing drive towards consolidation. Its coming of age, however, has coincided with challenging times. The global recession aﬀecting consumers’ spending power and behaviours calls for a more eﬀective business approach so that companies do not lose ground to their many competitors. And the opportunities are out there. As gambling is being regulated in more countries, entering the world of mainstream entertainment, merging with popular media brands and available 24/7 via ever smarter and more functional mobiles, only those operators who exploit these trends, reach out to new audiences and improve communication with players, will gain the competitive advantage.

Facing recession for the ﬁrst time

Regulation still uneven

Innovation is key

Finding a balance between minimising the impact of the economic downturn and exploiting the opportunities is crucial. To do that, the industry needs to have a clear understanding of the promises and traps behind those opportunities, and of the most cost-eﬀective ways to take advantage of them. It’s all about being smarter and more creative in how to use your budget to grow and expand. One way to do it is by understanding your customers better, forecasting their behaviour and inﬂuencing their choices; hence the increasing importance of customer analytics and research. The ultimate goal is to retain players and stimulate them to play (and spend) more. That is why retention is the key word in these tough economic times as operators have become more vigilant about their spending and CPA. Loyalty programmes and customer insights take centre stage as opposed to lavish acquisition spending and accounts left dormant for weeks or even months.

Two important events have recently taken place and influenced the regulatory landscape of online gaming in Europe. The Schaldemose report has put in doubt the possibility of pan-European regulation any time soon. On the other side, the reasonably firm promise of new markets opening up, including Italy, France, Denmark and Belgium, has been welcomed by the industry and perhaps indicates a need to reconsider its lobbying focus and model. With the action taking place on the member-state level rather than the European level, should operators concentrate their efforts on regulations in single jurisdictions as they emerge? This question still remains unanswered.

There is no space for complacency in the iGaming industry. As competition is fierce, operators need to be constantly innovating to offer new and better products to their customers. In their effort to appeal to a broader and more lucrative demographic, they need to watch the market closely, spot new trends quickly and discover how to monetise them before others.

The US market leaves the industry with another big question; Barney Frank’s bill, initiatives in California and Delaware, PartyGaming’s settlement with DoJ and Harrah’s Entertainment’s recruitment of Mitch Garber to head their Interactive division indicate winds of change. Hopes are high, but there is also anxiety about deﬁning the best strategy to re-enter this huge and proﬁtable market, where many punters, regardless of UIGEA, have already chosen their trusted brands.

Importance of shared knowledge and business intelligence There are very exciting and testing times ahead! Such challenges and developments call for collaborative working, business intelligence and constant learning to ensure that one stays in control and on top. The 8th European iGaming Congress taking place 15-17 September in Copenhagen will provide a platform for all three; it will oﬀer best practice, answers and solutions to those critical issues raised above. With the decision makers from all leading operator brands presenting case studies and engaging in discussions, EiG will again become the centre stage for deﬁning strategy for growth and success. And this year sees the strongest speaker line-up ever assembled for the industry.

Join PartyGaming, bwin, Ladbrokes, Betfair, William Hill, 888.com, Easybets, Blue Square, Intertops, Sbobet, Poker Heaven, PKR and many more to be part of the most important event of the year!

Find out more: Download the brochure at www.eigexpo.com To register, log on to www.eigexpo.com/CGIV or call +44 (0)207 067 1809

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MOBILE GAMING

PROPELLING GROWTH: MASS GLOBAL MARKET PENETRATION GATHERS MOMENTUM INTERVIEW WITH MATTI ZINDER

As most in the mobile content industry can attest, the current business model – subscription and/or pay-per-download – has not proven sustainable, especially during an economic downturn. Consequently, there was a need for a new, innovative business model that would be attractive to mobile content distributors and provide them with a new source of revenue. Although this sector is less affected by the current economic climate, the need to capitalise on the potential of new markets has never been greater.

GI: Mobile gaming, amid the current global financial malaise especially, gains from its affordability. How are you capitalising on this?

MZ: Mobile gambling seems to be less affected than other industries in the current economic climate likely due to the fact that it involves a relatively low cost thanks to the predominance of mobile gamblers playing in small bits rather than longer period of time more common to online use. More significantly for us, the current economic climate has not interrupted our strategy for growth and our commitment to innovation and delivering the products and support to drive our clients’ success. This past year we’ve launched our web-app games for the iPhone and G1 Android, as well as developing our Java platform for the BlackBerry. We are the first and only mobile casino software provider to receive eCOGRA certification setting the benchmark for industry standards of fair practise – something we hope and encourage other providers to follow. We also launched a new business model for mobile content providers to partner with mobile casino operators and share in casino revenues – thereby introducing an innovative and lucrative business model to the lagging mobile content industry. These achievements coupled with our on-going development efforts will set the bar for the mobile casino market and help to ensure the continuing growth of this industry despite difficult financial times. CGI: No doubt this favourable position and the prospects ahead were assessed at the Mobile World Congress in February and you drew conclusions from that? Casino & Gaming International I 85

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>> THE CURRENT ECONOMIC CLIMATE HAS NOT INTERRUPTED OUR STRATEGY FOR GROWTH AND OUR COMMITMENT TO INNOVATION AND DELIVERING THE PRODUCTS AND SUPPORT TO DRIVE OUR CLIENTS’ SUCCESS. THIS PAST YEAR WE’VE LAUNCHED OUR WEBAPP GAMES FOR THE IPHONE AND G1 ANDROID, AS WELL AS DEVELOPING OUR JAVA PLATFORM FOR THE BLACKBERRY. WE ARE THE FIRST AND ONLY MOBILE CASINO SOFTWARE PROVIDER TO RECEIVE ECOGRA CERTIFICATION SETTING THE BENCHMARK FOR INDUSTRY STANDARDS OF FAIR PRACTISE – SOMETHING WE HOPE AND ENCOURAGE OTHER PROVIDERS TO FOLLOW. >> MZ: As most in the mobile content industry can attest, the current business model – subscription and/or pay-perdownload – has not proven sustainable, especially during an economic downturn. We recognised that there was a need for a new, innovative business model that would be attractive to mobile content distributors and provide them with a new source of revenue. Our assumptions were validated by the positive response we received upon the launch of our Mobile Casino Partner Programme at the Mobile World Congress. This programme partners mobile content providers with casino operators. The partnership enables casino operators to take advantage of new channels of acquisition while providing mobile content providers a share of casino revenues for the lifetime of every player they drive into the casino. CGI: What impact, in your view, did you make at that Congress and what insight did you come away with? MZ: As I mentioned, our Mobile Casino Partner Programme was launched at Mobile World Congress ’09 and was well received. The nature of an ongoing revenue generator model is new to the mobile content world and badly needed. The Partner Programme lets each entity focus on their core business strengths; mobile content distributors market the casino games while the casino operator services and retains the new players. This model maximises revenues which are shared by each enterprise. We take the time to match the right content provider with the right mobile casino so that both partners enjoy the maximum benefit from working together. The mobile world is clearly ready for a new business model, and the interest we have received in the Programme has been very encouraging. CGI: Given the acceleration in Mobile growth and new innovative operators coming into play, how are your competitive and innovative ideas holding up? MZ: Our mission is to be the industry leader – to drive innovation and market development. We are thrilled by the mobile growth and emergence of new innovative operators entering the marketplace. Our commitment to innovation and development is well matched to meet their growing demands and ensure that our games and systems set the bar for innovation and results. Perhaps this was best illustrated by the integration with a UK mobile carrier to enable the purchase of casino credits via 86 I Casino & Gaming International

customers’ monthly phone bills resulting in a simple purchase process whilst keeping the highest security and age verification standards. A further example of our recent developments is the translation of our GameWire platform into Ukrainian. This represents the tenth language fully supported by our system – more than any other provider offers. We are well placed to support any company that is looking beyond the UK to enter new markets. Furthermore, we are the only provider to have developed commercially available games - as web applications – for the iPhone and Google Android devices. As industry leaders, we are committed to providing cutting edge solutions that keep up with technology development. We continually update our portfolio of games so that our clients can offer their customers the very best in mobile gambling entertainment and maintain their competitive edge. CGI: Since we spoke last, you have been busy with a number of significant achievements. What do you feel is your biggest achievement in the last year? Does this represent a breakthrough? MZ: You’re right, it’s been an exciting time for us. Perhaps our most important achievement has been to become the first provider to earn accreditation from eCOGRA – the independent player protection and standards organisation. The eCOGRA seal confirms that the development, implementation, maintenance and security of our mobile games portfolio and back-office systems are representative of industry best practice standards. CGI: With such recognition, you must feel this enhances the value of your operation? MZ: Yes, very much. The eCOGRA seal is a badge of fairness and credibility. This is hugely significant, not just for us, but for the mobile gambling industry as a whole. The rigorous evaluation and standards set by the eCOGRA organisation ensure that the mobile gambling industry will maintain the same high-standards and levels of player protection as online and we hope that our recognition by eCOGRA will encourage others in the industry to aim for and maintain similar high standards. We pride ourselves in leading the market in many ways – from technology to client care and responsibility. The eCOGRA seal further distinguishes us from others in the field.

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CGI: We have previously spoken about your appetite for new markets such as Asia and Spain. Which markets are you currently addressing? MZ: For some time, we have considered Asia offers great opportunities, and this remains the case. While we are well placed to capitalise the expected growth in the Asian market, it isn’t the limit of our ambitions or that of our clients. We are currently active in many markets, which you would expect from a global company. Eastern Europe and Latin America are also attractive regions that we are exploring. We are actively exhibiting and speaking at industry events and forging the partnerships that will deliver global success over the longterm. The direction in which we grow is determined both by our industry intelligence as well as our clients’ business strategies. Considering the current economic climate, the need to capitalise on the potential of new markets has never been greater. As was the case recently with our client 777Mobile, we match our clients' ambitions for growth and support their move into promising new markets. If it is a region that works for both us and our clients, we’ll develop the systems to make it happen. CGI: Since early last year you have particularly targeted the UK market. Has this begun to translate for you? MZ: The UK has always been a key strategic market for us and one of our strongest regions for some time; not least because it is one of the most mature mobile gambling markets worldwide. However, as the UK market becomes

saturated, our clients are looking at other regions around the world. Our mission is to support our client’s strategies with localised games and systems to allow them to enter new markets and deliver a gaming experience that is appropriate for each region. CGI: How do you see Mobile growth prospects affecting land-based casinos? MZ: In an era when land-based casinos are being severely affected by the global recession and the ability to obtain new clientele is more difficult than ever, the need to retain existing/regular customers has never been greater. Customer loyalty and retention marketing programmes is therefore the key to business models and objectives. We introduced the SpinPoints Loyalty System as an innovative means for land-based casinos to utilise the mobile channel and enhance their loyalty systems via a branded mobile casino. The system not only sends the casino brand home with guests, but also gives players the opportunity to continue their gaming pleasure even after they leave the casino premises. The system lets land-based operators extend their brand, communicate with customers and use the mobile casino as an enhancement to their loyalty programme. CGI: Mobile functions and gaming content now favourably compare to online access. Does this mean you envisage greater integration ahead? MZ: In many ways, mobile is an extension of the online space, especially with the advent of the Smartphone and

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web app games. We have developed web-based games that eliminate download and install times and deliver razor-sharp graphics creating a gaming experience akin to online. Mobile and online gambling use the same games; we develop Microgaming games for the mobile space, so the move between online and mobile is quite natural for players. There are other shared technologies as well. All online payment systems, for example, can be used on mobile as well, as can fraud protection software. We are definitely moving towards further integration and the Smartphone has really helped that move.

operators and their player’s as well. While most people gamble for entertainment purposes, our clients acknowledge that gambling can create problems and harm some individuals. Therefore, our clients maintain a problem gambling policy to deal with such issues in addition to their commitment to creating a responsible gambling environment by implementing and maintaining eCOGRA’s responsible gaming requirements, for the benefit of both players and staff. CGI: What do you consider to be the priorities and advantages of your long term strategy?

CGI: How do you see mobile multiplayer gaming evolving? MZ: While multiplayer gaming is a fantastic format for online gaming, where players are sitting down for a longer period of time, we are not yet convinced that mobile is the ideal channel for this type of gameplay. Mobile gambling is much more of an on-the-go format. As well, connectivity issues would be much more significant in a multiplayer game. But, who knows, it might be something to look at in the future. CGI: The one sure thing with greater usage and reliance on mobile gaming is its attraction to fraudsters. Protection measures are no doubt paramount to you? MZ: As I say, mobile gambling systems are fundamentally based on an extension of internet technologies and applications and unfortunately, the presence of fraud is a fact of life for our industry. Operators really need to do all they can to minimise risk. We take this issue very seriously which is why we work with a reputable fraud management firm utilising industry leading technologies, sophisticated player monitoring and large shared databases to provide fraud screening 24/7. One area in which mobile gambling differs from online is that its operators need to offer robust handset specific security. Our preventative systems, for example, do not store data on the phone itself. Secure transactions and other fraudsensitive processes are executed on the server, which is housed within a secure IT environment. Finally, it’s critical that mobile casino operators test and challenge their own systems. Regular testing ensures that the highest standards of reliability and security are maintained and our clients can have complete confidence in us. We are the first and only mobile casino system that is audited and tested independently by eCOGRA. I don’t think the importance of the trust we have built with our clients through such initiatives can be underestimated. CGI: A shift to mobile gaming may also suggest a greater problem of gambling risks. Are you prepared for this challenge? MZ: Player protection is paramount. Long-term growth and success for any player in the market will only be achieved if everything is done to ensure the safety of the end-user. We offer our clients the highest level of security and safety tools. Our eCOGRA seal affirms us as a company and our mobile gambling systems are entirely trustworthy. A number of our casino clients have also undergone eCOGRA testing and received ‘Safe and Fair’ seals. Even more are in this process as player security is paramount not only to us but to our 88 I Casino & Gaming International

MZ: We are committed to delivering cutting edge products and solutions that drive the development of the mobile casino industry while setting the benchmark for integrity and safe practise. Product development based on both industry requirements and client demand will ensure that we continue to support our client’s strategies and remain at the forefront of this exciting industry. Innovative business models will encourage participation from both the mobile content and casino industries which will propel the industry as a whole and continue the momentum to mass global market penetration quickly and successfully. CGI

MATTI ZINDER Matti Zinder is the founder and CEO of Spiral Solutions Ltd., a full-service interactive marketing, advertising and technology development firm established in 1999. Foreseeing the direction where interactive gaming was headed, in 2003 he established Spin3, a division of Spiral Solutions, which to date is credited with developing and rolling out one of the leading mobile gaming solutions worldwide. Spin3 has been nominated as the Best ‘Made for Mobile’ Game system at the Mobile Entertainment Forum 2005 and at the World 3GSM conference 2006. In 2005, three leading full-service UK mobile casinos were launched using Spin3’s proprietary platform and technology, and earlier this year, he was named one of the 50 most important individuals in mobile content worldwide by a respected and leading wireless industry publication. Matti has become a leading voice and authority in the area of mobile gaming, and has served as a keynote speaker at many international wireless industry symposiums and conferences, including the Mobile Entertainment Forum, Mobile Gambling Forum, MEM Asia and the Mobile Gambling Summit Asia. Prior to founding Spiral Solutions, Matti served as the Director of Marketing/East Asia at Elbit Defense Systems, a global defence electronics company and as Vice President of Marketing at eSafe Technologies/Aladdin, a NASDAQ listed company. He holds degrees in Chinese and Far Eastern studies and Business Administration from the Hebrew University in Jerusalem. Matti Zinder is proficient in a number of languages, including Mandarin Chinese, Hebrew and Arabic.

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US, UIGEA & POKER

IS FREEZING ONLINE POKER PLAYER PAYOUTS A NEW OFFENSIVE? BY JIM TABILIO & MELANIE BRENNER

Do recent actions by the new United States Justice Department (DOJ) in seizing online poker payouts mean the Obama Administration is moving towards even tougher actions against online poker than practiced by the Bush DOJ? Or do the new actions instead help pave the way for legalisation and regulation? History and stark political realities point to the latter, but probably not by the expected path.

arly in 2003, President George W Bush’s Attorney General John Ashcroft awoke one day to realise that not only was gambling -- in the form of tournament poker -- being featured on American television on a regular basis (The World Poker Tour had recently begun its televised run on The Travel Channel), but that Americans were being lured into the sin of online poker through advertising being run on the WPT and elsewhere. The perhaps apocryphal story is that the Attorney General overheard two DOJ attorneys at a senior staff meeting one morning discussing their own online poker exploits and the previous night’s WPT broadcast. Thus tipped off, the conservative evangelical John Ashcroft sprung into action. The DOJ snapped into action and sent letters to the Discovery Networks (owner of The Travel Channel) and others carrying electronic or print advertising for offshore poker websites. The letters advised the recipients that these sites violated Sections 1084, 1952 and 1955 of the US Code, Section 2 and that such violations constituted a ‘Class E felony’ under the law. Furthermore, the letter explained that carrying advertising for the sites could be considered “aiding and abetting” such violations and therefore subject networks and print publications carrying advertising for the sites to the threat of felony criminal prosecution as well. The letters were neither the first nor the most dangerous Bush DOJ threat to traditional American guarantees to freedom of speech, but they did begin a rather dramatic chain of events for the online gaming industry in the US. A few months later in April of 2004, in the absence of any actual federal law that made playing poker online illegal for individual Americans, John Ashcroft directed his agents to seize revenues of the Discovery Networks flowing from

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>> AMARILLO SLIM ONCE SAID ABOUT SITTING DOWN IN A STRANGE POKER GAME IN A STRANGE TOWN: “I ONLY NEED TO KNOW ONE THING ABOUT A NEW GAME. I NEED TO KNOW I’M GOING TO GET PAID IF I WIN.” WITH NEW STATE SYSTEMS COMPETING AGAINST ESTABLISHED OFFSHORE SITES, THAT MAY BE THE KEY QUESTION ABOUT WHERE AMERICANS WILL SPEND THEIR ONLINE DOLLARS. >>

advertising sales to offshore poker ‘cash’ websites. Later, the DOJ reached a settlement with The Sporting News, one of America’s most prominent national sports publications, in which the News reportedly agreed to a $7.2m settlement to atone for having carried offending advertising in its pages. John Ashcroft had made certain America was safe once again from the threat of too much personal freedom. Of course, attorneys for American television networks, publications and offshore poker sites quickly determined that identical advertising for ‘.net’ versions of the sites – set up for ‘educational’ purposes, rather than gambling – could not be similarly threatened with prosecution. To the untrained eye, it may have seemed that the ads had not changed much, if at all. Just one small web address extension. The ad dollars flowed once more, and the amount of poker programming on US television actually increased. Things rolled quietly along on that basis for a few years, John Ashcroft apparently content that at least he had ensured Americans could expand their educational opportunities on the .net sites. The passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) made the finer points of the .com/.net argument moot for the many prominent offshore companies that withdrew from the American market following the law’s passage. The companies that remained in the US market continued to advertise their .net sites. While UIGEA has made it a little more cumbersome to conduct business, to date none of those companies has been prosecuted for offering online poker to Americans. The key phrase there is ‘to date.’ MOVING FORWARD That’s where things stood when Senator Barack Obama was elected President in November 2008, when ‘everything changed.’ That was the expectation. But seemingly not the reality, at least with regard to online wagering. There were no calls from the White House for legal and regulated online wagering. No opinion letter from the new Attorney General that DOJ policy had changed and companies offering online wagering to Americans were no longer considered to be in violation of federal law. Apparently quite the contrary. In early summer 2009, five months into the Barack Obama administration, the United States Attorney for the Southern District of New York froze millions of dollars in payouts to American online players from a number of offshore poker sites serving US residents. That was something the Bush Administration had talked about but never done. Disrupting payouts to winners seemed to be the first direct attack by the federal government on the players themselves. That did not seem like the change poker players had hoped for. In fact, it seemed like more of that same – much more and much worse. 90 I Casino & Gaming International

Maybe not. Some well-connected political observers believe that new strategy is not designed to be a more efficient means of eliminating Americans’ access to online poker. In fact, there is every likelihood that these actions by federal law enforcement may clear the path for regulation and legalisation. And that would be a significant and pragmatic change in US gaming policy. THE POLITICS Whatever was going on in the halls of federal law enforcement agencies over the past few years, legislative efforts to legalise, regulate and license online poker (and eventually other forms of online wagering) have made progress on both the state and federal levels. In Washington, Congressman Barney Frank and his allies in the US House of Representatives have introduced a range of new versions of old bills, laws that would gut UIGEA, establish a federal regulatory and licensing scheme, declare poker a skill game not subject to the Wire Act or UIGEA and more. Those proposals are getting a much more favourable look in this Congress than they have previously. Still, virtually no objective political observer believes these proposals have a chance of passage in the current session of Congress, or any time in the near future. Part of the reason is that Congress has a large number of more pressing priorities in the current economic crisis. But even more important is that there exists no political will to take the final step on the federal level. A large number of elected officials in the United States still do not have a clear idea of what online gambling – even online poker, which has been widely featured on television for years – actually means. Many do not even have a clear idea of what the Internet itself is. (If you doubt this characterisation or think it a stereotype, please remember that until 2005 US policy on Internet regulation was controlled by an elderly Senator from Alaska who famously once described the Internet as an ungovernable ‘series of tubes.’). All of us who try to educate decision-makers on the realities of the issue have been told more than once by elected officials that the internet can never be regulated, so there’s ‘no way to protect’ American online poker players and no point in trying. On the more practical political level, Representatives from conservative or marginal Congressional districts do not relish the prospect of their opponents in future elections using attack television commercials accusing them of protecting the profits of offshore gamblers who corrupt America’s children through online poker. And note that these politicians recognise that those attacks could be financed by well-funded land-based gaming operators who don’t want to share their existing gambling revenues with legal online

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gambling operations. Finally, all the talk of dramatic political change that will follow a new Democratic President and large Democratic majorities in Congress may well be true in the areas of health care or global warming, but online gambling has never really been a partisan political issue on the federal level (no matter how much some conservative Republicans like to view it as sinful). There are many dedicated liberal/progressive Representatives in Congress who continue to steadfastly oppose expansion of online gambling as a ‘tax on the poor’ that would exploit those Americans least able to afford it. Larger Congressional majorities of liberal Democrats mean nothing on an issue that is of little concern to the base of that party and has no sizeable constituency among that base. THE PRACTICAL REALITY The public policy argument for legalisation and regulation of Internet wagering on the federal level may be even less compelling than the political arguments. If you accept the most favourable estimates of the tax revenue that could be generated in the US through online gambling (probably represented by the top tier of potential revenue described in the PricewaterhouseCoopers national study in 2008), with minimum opt outs and the maximum range of possible online wagering opportunities (including casino games), the states and federal government would be looking at about $5bn a year in revenue. But legalisation of a full range of online wagering is unlikely (most would say impossible) in the near future. And the bulk of the tax revenue described in the PWC study would flow to the states rather than the federal government. Even being generous and assuming a 50-50 split of maximum revenues, online gaming would generate about

$2.5bn a year in revenue for the Federal government. In fact, with a much more limited range of possible games, that amount is likely to be closer to $1bn a year the Federal government would realise – minus costs for enforcement and regulation. In the real world, that’s real money. In the world of the US budget deficit, that’s not even a drop in the bucket. Almost any political professional in America will assure you that no Congressman from Alabama, Oklahoma, southern Indiana or Ohio is going to risk his political future voting for a bill with so much potential political downside and relatively minor benefits, no matter how many poker players think it’s a great idea. FOLLOW THE MONEY The realities get worse for legalisation and regulation on a federal level. Even if it were to pass in its current form, the language of Congressman Barney Frank’s bill would allow states to opt out of the Federal system. With regard to online poker (the most probable vanguard of legal online gaming in the US), it is likely -- almost certain, in fact -- that largepopulation states with a sufficient number of online poker players to assure liquidity would opt out and alternatively establish their own intrastate systems. These systems are not only permitted under the intrastate exemption contained in UIGEA, they would certainly be far more lucrative to individual governments of large states than sharing revenue with the Feds. These intrastate systems would allow state leaders to assure their voters that state law enforcement would oversee consumer protections for in-state online players, while maximising revenue to their states. New Hampshire, Rhode Island and Wyoming might see the benefit in a national regulatory scheme that allows them to pool players and split revenue with the Feds. But why would California, Florida or New York choose that path?

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Think of how the average voter reads these numbers: half a billion dollars a year in revenue to California means keeping 5,000 teachers/firefighters/police officers on the job. Half a billion in revenue to the Federal means enough additional bailout money to fund next year’s bonuses for five AIG executives. Those who don’t grasp what that means to elected officials haven’t watched enough US political campaign attack ads. All of this indicates that while legalisation and regulation are likely in the near future – at least with regard to online poker – those actions are much more likely to occur on a state-by-state basis where the financial arguments in favour of the system can have a real impact on cash strapped state governments and their residents. Large-population states like California and Florida, with sufficient potential liquidity for intrastate online poker systems allowable under UIGEA, are taking the lead in considering legalisation. The California and Florida efforts have been created and guided by the non-profit advocacy group Poker Voters of America. The organisation expects to sponsor similar legislation in a number of additional state Legislatures by early 2010. Obstacles to legal intrastate online poker remain, but the consumer protection benefits and revenue potential generated by legal and regulated intrastate online poker will be a strong attraction for state governments in California, Florida, Pennsylvania, New York, New Jersey and even Texas. All these states – all with growing budget problems – understand that they have an opportunity to capture revenue from an already existing and untaxed industry which serves large numbers of those states’ residents. Which brings us to the Obama DOJ and its ‘war’ on payouts to the customers of currently unregulated, unlicensed and untaxed offshore poker sites. HOW THE OBAMA ‘CHANGE’ HELPS Whether it’s on a federal of intrastate basis, how do the recent actions of the Obama Justice Department help advance the cause of legal and regulated online poker in particular? As one Washington political professional observed the week after the seizures of winners’ payout noted: “The DOJ is clearing the brush. Whether it’s intentional or not – and I’d bet it is intentional – they are undercutting confidence that winners will be paid by sites currently serving US customers.” What is the most critical barrier to entry and serious challenge to the success of a fledgling legal and regulated new online poker system, whether it’s federal or intrastate? It’s migrating the current large base of American players from the sites where they are comfortable and confident right now to new regulated and licensed systems. You can include legal barriers for these existing sites in the new laws. You may even be able to created workable technological barriers. Or you can simply undermine confidence of existing players that their money is safe with their favourite current sites – the same sites that both the old and new Justice Departments say are in violation of current federal law. How many days of news stories will it take before current players decide that their money is going to be at risk unless they switch to the new state-regulated online poker system that not only protects their money and makes it easy 92 I Casino & Gaming International

to deposit with your American ATM card, but also carries a law enforcement guarantee they will get paid if they win? It took Svenska Spel only a few hours to migrate a significant portion of players to the new Swedish government online poker system. As Amarillo Slim once said about sitting down in a strange poker game in a strange town: “I only need to know one thing about a new game. I need to know I’m going to get paid if I win.” With new state systems competing against established offshore sites, that may be the key question about where Americans will spend their online dollars. The Obama DOJ understands that legalisation and regulation of online poker is coming one way or another. And their current offensive will make sure the competitive landscape is as clear as possible for lucrative and legal systems to take hold and thrive. CGI

JIM TABILIO & MELANIE BRENNER The founder and immediate past President of Poker Voters of America, Jim Tabilio is a Principal of Winning Directions, Inc., one of America’s leading political strategy and messaging firms, providing services to clients including political campaigns, labour organisations, non-profit advocacy groups and private sector clients throughout the US and the Pacific Rim. Independently, he also performs public policy consultancy services for state governments and private sector clients in the gaming industry seeking legislative approaches aimed at building sustainable business models for legal online gaming in the US. Jim earned his Bachelor of Arts degree in Political Science, and pursued post-graduate studies in public policy, at the University of San Francisco. He may be reached at jimtabilio@gmail.com. As the Executive Director of Poker Voters of America, Melanie Brenner oversees the operations for the organisation including member and legislative outreach, education and fundraising. She has 25 years experience as a political consultant working on candidate and issue campaigns in California and Florida. Prior to her work for Poker Voters of America, she served as Executive Director of One Brick, a national public service non-profit organisation dedicated to the promotion and facilitation of volunteerism. Melanie received her Bachelor’s Degree and graduate training at the University of Texas. She may be reached at PokerVoters@aol.com

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POKER INNOVATORS

DAMNED IF YOU DON’T…SO SEIZE THE OPPORTUNITY

BY VAHE BALOULIAN

It is very rare that a great opportunity comes along so explicitly labeled and screaming to be taken advantage of. Internet gaming is such an opportunity. In a way, it is very similar to poker. You can compete with the stars and the pros on the same field and the entry fee is not out of reach. There is an element of luck but it is mostly the skilled that seize the day. Of course, opening an online poker room is one thing, being able to operate it is quite another. While online operators have fully embraced the future, it is also something that is becoming of increasing significance to land-based groups.

any years ago I took part in a few gatherings of European casino operators who, with the support of the gaming equipment manufacturers, were struggling to set up an association to promote their interests. At the time I was in charge of gaming and industry relations for one of the largest online gaming companies and was trying to get land-based casinos to recognise, embrace and benefit from our side of the gaming industry. I was the only online gaming executive present at these meetings. Frankly, I don’t know why they let me in. Maybe they agreed to give me access because of my persistence; maybe it was just an opportunity to meet and observe the ‘online species’ they had begun hearing about. In any case, I was invited twice. They didn’t achieve the goal that brought them together, as their association failed to come about. However, I remember an elderly Spanish gentleman, a very well known, old-school character in the European land-based casino industry, who enjoyed ridiculing me. For him, I represented something he neither understood nor wanted to understand. Therefore, he decided that my company, making over a million dollars a day, and the industry it was a part of were not worth his time and attention. He was too busy making a million a month, if even that, to be bothered. Backed by the arrogance that could only come from a man who thinks he has seen it all, he missed the opportunity I was presenting. At that time his attitude was very typical of the land-based casinos. Years have gone by. Online gaming has matured to the point where I would feel justified to knock on the doors of those skeptics with an uncontrollable grin of ‘I told you so’.

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Many land-based groups are now major online operators. More are yet to face the epiphany. Why? Well, some operators are just too complacent while others are downright lazy. Many are waiting for the regulators to say the word and some oppose the legalisation and regulation of online gaming altogether. For example, Las Vegas Sun reported that Steve Wynn believes that Internet gambling “can’t be adequately policed and could embarrass the industry.” Wynn can afford to think this way, albeit with no basis. He has already made a name and a buck without the Internet gaming scene. When he was pushing the boundaries in his own time, I am sure there were people saying that what he was doing was insane and could not be done. I am glad he did not listen to them at that time as I hope the new breed of the gaming pioneers will not listen to him now. It is very rare that a great opportunity comes along so explicitly labeled and screaming to be taken advantage of. Internet gaming is such an opportunity. In a way, it is very similar to poker. You can compete with the stars and the pros on the same field and the entry fee is not out of reach. There is an element of luck but it is mostly the skilled that seize the day. Of course, opening an online poker room is one thing, being able to operate it is quite another. Many failed

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miserably in their online ventures simply because they didn’t know how to manage that ‘online thingy’ properly. Some paid enormous amounts of money and bought what was supposed to be the best online gaming vehicles but wrongly presumed that if they could drive a car, they could fly a plane as well. Often I met with maverick casino owners, and when I say casino I don’t mean some shabby joint, which, while creating their land-based success, would, as novelist Ray Bradbury recently said, jump of the cliff and build their wings on the way down. These risk-takers, whose success is widely acknowledged, told me that they think it is time to get into an online business. However, they did not know much about Internet gaming and had grown too comfortable with their position in business and life to do the ‘jump’ again. They outsourced the online project to their subordinates, who by definition played it more carefully and cut the wings before they had any chance of getting some wind underneath them. The actions that made their land-based operations what they are today were considered too risky now. Forgetting that the security of success is mostly a myth, they decided to take things slowly while seemingly keeping everything under control. The problem is that when things seem to be under

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>> SURVEYS OF ONLINE PLAYERS SHOW THAT THEY FEEL CHEATING OFTEN OCCURS ONLINE AND THE OPERATORS HAVE THE POWER TO MANIPULATE THE SOFTWARE IN THEIR FAVOUR. WHETHER IT IS TRUE OR NOT IS IRRELEVANT. THE LAND-BASED OPERATORS CAN EASILY CAPITALISE ON THIS SENTIMENT. BY DEFAULT THEY ARE A BETTER TRUSTED ENTITY SIMPLY BECAUSE THEY ARE REACHABLE. THEY ARE A TANGIBLE PROVIDER. THE FEELING OF BEING PROTECTED IS IMPORTANT TO PLAYERS AND THE OPERATORS WITH LAND-BASED PROPERTIES CAN PROVIDE IT EASILY. >> control, it may simply mean that one is not moving aggressively enough. They were hesitant to acknowledge that to have another shot at success, this time online, they would need to forget what they had achieved in the past or where they are now, and simply keep in mind how they managed to get there. I think they knew not to expect a red carpet welcome into the online world, since they did not get one when starting out on their journey to land-based success. However, it is not easy to shake the feeling that they should get preferential treatment, anyway. It is true that if you do it right, the online operation is a very complicated undertaking. It may look simple only to those who have no idea about it, but that is it. Many realise this and opt for employing the experts. This is a smart approach. One should either create experts in-house or get them from the outside. What you should steer clear of are the so-called ‘experts by association’ whose stints with well-known brands give them an aura of command. One of the most often made mistakes is blindly hiring staff based on the past employer’s reputation. Having worked at a brand-name establishment does not make one an expert, regardless of their position. The importance lies in what one has really accomplished in an organisation. For example, a marketing director of a small cardroom with a shoestring or no budget that managed to keep his organisation running and succeeded in growing, it could be more valuable (and cost you much less to employ) than the one who used to work with big budgets and a huge team in a well-established group. Of course, managing big budgets correctly and turning them into successful campaigns is not an easy task. That is why you should look beyond the teams’ achievement into the personal contribution and accomplishment of each ‘expert’ you are hiring. Just because a big-name group has brought someone on board does not mean he or she is good, even if the references are overflowing with praise. Dig deeper, ask a lot of questions, and let them solve a difficult situation you once faced in your business and you should avoid making the same mistake. Though they may not know the answer, the way they approach the problem should tell you a lot. Another mistake, due to insolence, is the assumption that your land-based success will flow into your online undertaking because of your brand, or that you have enough money to buy your way into the market and push others aside. Always remember that the biggest of the gambling brands failed online and the richest of the pockets

miserably acknowledged their lack of achievement and ceased to exist or continued their existence as just ‘one of many’. Be humble and tread carefully and respectful of your online competition. They know many things you still have to learn and appreciate. The online gaming industry may only be about 15 years old but so much has been compressed into these years that even if you have been running your land-based empire for half a century, that knowledge may not be enough to carry you through the turbulence you will face online. Think of the online gaming industry’s lifeline in ‘dog years’. Even some of the once most successful and oldest of the online operators did not manage to survive simply because they thought they could do it effortlessly. Having said this, it is very important to stress that landbased operators have numerous advantages when moving online because they can provide many of the things that an Internet player is looking for. For example, surveys of online players show that they feel cheating often occurs online and the operators have the power to manipulate the software in their favour. Whether it is true or not is irrelevant. The land-based operators can easily capitalise on this sentiment. By default they are a better trusted entity simply because they are reachable. They are a tangible provider. The feeling of being protected is important to players and the operators with land-based properties can provide it easily. Any sensible online player is looking for a professional operation that will offer fair games, is financially stable and socially responsible, will supply timely and knowledgeable support, will guarantee the security of their personal, financial and gaming information, will process deposits and withdrawals on time and face to face. The players want fast and responsive, independent outlets to air their disputes and resolve them without delay. Demands for transparency and uniformity of code of conduct are also high on the players’ lists. All these are part and parcel of land-based operators’ current offerings and will require less time and effort to bring players to the Internet and for them to welcome it. Another competitive advantage is that very few of the online operators can afford to go terrestrial and add a landbased operation. Every land-based group can go online at a very low cost and in almost no time. So, what does it take to go online with your poker room? How many ways are there to break into this world that has garnered so much interest? To get your online poker room going you can: Casino & Gaming International I 95

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a) start your independent stand-alone room with your own software; b) turn your independent online card room into a network by choosing to white-label other operators; c) start your own stand-alone room using a third-party software; d) become a licensed operator on a network powered and managed by a third-party; e) become a network within a network, powered and managed by a third party; f) become an intermediary of the licensed operator, essentially a marketing organisation with deeper access to the cardroom’s operations. These options change with time as each licensing jurisdiction experiments in an effort to gain more licensees while keeping their regulatory reputation intact. While I have not come across a comprehensive book or study about the inner workings of an online gaming company, be it a casino, cardroom, sportsbook, bingo or combination of all these, most of the companies have manuals describing the ins and outs of their operations. These manuals are confidential, of course, but unless you pick the independent route, you might be able to get your hands on them. Depending on which ownership option you find more attractive and feasible to your entrance into online gaming, you may or may not need these departments: a) Customer Support – email; live chat; telephone.

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b) Marketing – online; offline; telemarketing; SEO; affiliate management; business analytics; loyalty and retention. c) Payment Processing – online; offline. d) Risk Management – game security; payment security; money laundering; under-age gambling. e) Technology – game development; back office; hosting; network management. I could fill a book with a detailed description of how each one of these departments work. And I might do it one day…but do not wait for me. Seize the opportunity now. CGI

VAHE BALOULIAN Vahe Baloulian has served as the Customer Retention Controller and Director of Gaming and Industry Relations for one of the world's largest online gaming companies. Later, he turned a struggling poker network into a profitable one for a subsequent sale. Now Vahe is the CEO of Red Planet Marketing GmbH (www.redplanetgaming.com), which provides uniquely flexible solutions to own and operate online card rooms or networks and enhance the performance of existing online and land-based gaming properties. Red Planet Gaming, based in Vienna, Austria, and Las Vegas, USA, is a winner of the International Gaming Awards 2008 and 2009.

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SOCIAL RESPONSIBILITY

THE IMPLICATIONS OF REAL-TIME BEHAVIOURAL TRACKING BY MARK GRIFFITHS

In contrast to offline gambling, behavioural tracking presents an opportunity for gaming operators and researchers to examine the actual and real-time behaviour engaged in by gamblers. To date, almost all diagnostic screening instruments contain criteria that are a mixture of statements about actual problem gambling behaviour, accompanied by criteria relating to the negative associated consequences of gambling. If problem gambling can be identified online without the use of diagnostic gambling screens, then this may have implications for the development of problem gambling screening instruments in the future.

or a number of years gambling researchers have been recommending to gaming companies (especially online gaming companies and those companies who offer loyalty cards), that they should start using their large data sets to help identify problem gamblers rather than target them for extra revenue (e.g., Griffiths & Parke, 2002; Griffiths, 2003; Smeaton & Griffiths, 2004; Griffiths, Parke, Wood & Parke, 2006; Griffiths, Wood, Parke & Parke, 2007; Wood & Griffiths, 2008). There are two routes that gaming companies can take in identifying and helping online problem gamblers. Firstly, they could use a social responsibility tool that has already been developed, the most obvious example being PlayScan (Svenska Spel; see Griffiths, Wood, Parke & Parke, 2007; Griffiths, Wood & Parke, 2009). The second is to develop a bespoke identification scheme such as the Observer system designed by 888.com. In contrast to offline gambling, behavioural tracking presents an opportunity for gaming operators and researchers to examine the actual and real-time behaviour engaged in by gamblers. Furthermore, such tracking technologies may provide implications for future diagnostic criteria for problem gambling if it can be shown that problem gambling can be reliably identified online without the use of established problem gambling screening instruments. In short, it could eliminate all the inherent weaknesses of the self-report methods that dominate traditional problem gambling research (such as gamblers lying, being economical with the truth, and/or providing socially desirable responses during questionnaires or interviews). To date, almost all diagnostic screening instruments contain criteria that are a mixture of statements about actual

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>> TRACKING TECHNOLOGIES MAY PROVIDE IMPLICATIONS FOR FUTURE DIAGNOSTIC CRITERIA FOR PROBLEM GAMBLING IF IT CAN BE SHOWN THAT PROBLEM GAMBLING CAN BE RELIABLY IDENTIFIED ONLINE WITHOUT THE USE OF ESTABLISHED PROBLEM GAMBLING SCREENING INSTRUMENTS. IN SHORT, IT COULD ELIMINATE ALL THE INHERENT WEAKNESSES OF THE SELF-REPORT METHODS THAT DOMINATE TRADITIONAL PROBLEM GAMBLING RESEARCH (SUCH AS GAMBLERS LYING, BEING ECONOMICAL WITH THE TRUTH, AND/OR PROVIDING SOCIALLY DESIRABLE RESPONSES DURING QUESTIONNAIRES OR INTERVIEWS). >> problem gambling behaviour, accompanied by criteria relating to the negative associated consequences of gambling. The rest of this article therefore examines one of the world’s most used problem gambling screening instruments (i.e., the American Psychiatric Association’s [1994] criteria for pathological gambling) and relates these to online gambling behaviours. As will be demonstrated, only a few of these behaviours can be reliably identified online. This is then followed by an examination of other behaviours by problem gamblers that may be identified online. These behaviours were compiled and based on my social responsibility work with Internet gaming companies over the last five years. PROBLEM GAMBLING, SCREENING CRITERIA AND ONLINE GAMBLING BEHAVIOUR In this section, each of the ten DSM-IV problem gambling screening questions is outlined. Each of the DSM questions is then followed by what the criterion question is primarily concerned with assessing. This is then followed by a brief commentary concerning the extent to which the DSM criterion behaviour can be assessed online without the need to ask gamblers if they have or haven’t engaged in such behaviour. Following the assessment of all ten individual questions, the implications for how problem gambling may be assessed in the future are outlined.

DSM screening question – Do you find that you are becoming preoccupied with past gambling successes or find yourself spending increasingly more time planning future gambling? What does the screening question assess? – The extent to which a person is preoccupied with gambling and how important gambling is in that person’s life (i.e., how salient the gambling is). Implications for online gambling – A problem gambler is likely to spend a lot of time gambling online although this behaviour in itself does not necessarily indicate a problem. Anything above four hours daily play over a protracted period could be considered excessive although some forms of online gambling (e.g., online poker) may take up a lot of time and be played relatively inexpensively. Gambling pre-occupation (in terms of time spent online actually gambling) is something that could be identified easily using behavioural tracking technology. DSM screening question – Do you find that you need to 100 I Casino & Gaming International

increase the amount of money you gamble to achieve the same enjoyment and excitement? What does the screening question assess? – The extent to which a person experiences tolerance (i.e., the increasing need for gambling as a way of changing their mood state for the better, at least in the short-term).

Implications for online gambling – If experiencing tolerance to gambling, online problem gamblers are likely to have changed their gambling behaviour in one of two ways over time. The first example of tolerance is a gradual increase of online daily play in terms of time. For instance, the player might start off playing 15-30 minutes a day but over the course of a few months starts to gamble for increasing amounts of time. The second example of tolerance is the act of gambling online and gradually gambling with bigger and bigger stakes over time. A problem gambler is more likely to experience both of these combined (i.e., gambling for longer and longer periods of time with bigger and bigger amounts of money). Experiencing tolerance (in terms of both time and money) is something that could possibly be identified online using behavioural tracking technology. DSM screening question – Have you recently tried to stop gambling but were unsuccessful? What does the screening question assess? – The extent to which a person experiences relapses when attempting to give up gambling. Implications for online gambling – Although this is difficult to detect with absolute certainty online, it is not impossible. A typical pattern for a relapsing gambler might be that a gambler who gambles heavily, day-in day-out, for a period of time and then “disappears” for a period of time (which could be days, weeks, and sometimes even months), only to suddenly re-appear and gamble heavily again. Experiencing relapse is something that could be identified using behavioural tracking technology although sudden disappearance from an online gambling site may have other simple explanations (such as gambling with a different online gambling operator). DSM screening question – Do you become moody or impatient when you are cutting down how much you gamble?

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What does the screening question assess? – The extent to which a person experiences withdrawal symptoms when not gambling.

Although many non-problem gamblers use this strategy on occasion, the online problem gambler will chase losses repeatedly.

Implications for online gambling – Spotting withdrawal symptoms online using behavioural tracking technology would be very difficult to detect with any absolute certainty online, but is most likely to surface with the use of verbally aggressive comments in those games that have in-game online chat room facilities (such as online poker or online bingo).

DSM screening question – Do you ever hide how much or how often you gamble from significant others? What does the screening question assess? – The extent to which a person conceals their involvement in gambling from those close to them.

DSM screening question – Do you ever use gambling as a way of ignoring stress in your life or even as a way to pick you up when you feel down? What does the screening question assess? – The extent to which a person uses gambling as a way of reducing stress and escaping from reality. Implications for online gambling – Identifying escape gambling using behavioural tracking technology is again almost impossible to detect online although those players who play for long hours every day are perhaps more likely to experience escape-like feelings. The only other way this might be picked up online is via conversation in online chat rooms. DSM screening question – Do you ever try to win back the money you lost by increasing the size or frequency of your wagers? What does the screening question assess? – The extent to which a person chases their losses while gambling. Implications for online gambling – This is one of the key indicators of problem gambling and can arguably be identified more easily using online behavioural tracking technology than any other problem gambling criterion. Typical chasing patterns will include repeated ‘double up’ strategies in an effort by the gambler to recoup losses.

Implications for online gambling – Unfortunately, there is no way that an online gambling operator can spot whether gamblers conceal their involvement from other people during online gambling unless such admissions are given to other players in the online in-game chat rooms. DSM screening question – Have you ever committed fraud or theft to get money to gamble with? What does the screening question assess? – The extent to which a person has engaged in unsociable and/or illegal behaviour as a consequence of their gambling. Implications for online gambling – Again, there is almost no way that an online gambling operator can spot unsociable and/or illegal behaviour during online gambling unless such admissions are given to other players in the online in-game chat rooms. DSM screening question – Has gambling ever ruined a personal relationship or an occupational or educational opportunity? What does the screening question assess? – The extent to which a person has ruined a relationship or a life enhancing opportunity. Implications for online gambling – As with the previous two criteria, there is no way that an online gambling operator can spot whether gamblers have ruined relationships and/or opportunities via online gambling unless such admissions are given to other players in the online in-game chat rooms.

Table 1: Summary of problem gambling criteria (DSM-IV) and likelihood of identification of problem gambling behaviour online DSM-IV Criterion

Likelihood of online identification

Experiencing salience/preoccupation Experiencing tolerance Experiencing relapse Experiencing withdrawal symptoms Escaping from reality Chasing losses Concealing involvement Engaging in unsociable behaviour Ruining a relationship/opportunity Other people providing a bail-out

Very good possibility Possibly Possibly Unlikely Unlikely Definitely Unlikely Unlikely Unlikely Slight possibility

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DSM screening question – Have you ever needed others to relieve a financial problem created by gambling? What does the screening question assess? – The extent to which other people in the gambler’s life have bailed them out of financial trouble.

Implications for online gambling – When an online gambler has exhausted all their own funds, they will often ‘beg, borrow and (eventually) steal’ money to continue gambling. A player whose account is constantly ‘topped up’ by people other than themselves may be a sign that that they have a gambling problem. Identifying instances of other people providing a ‘bail out’ is something that could possibly be identified using behavioural tracking technology if it happens constantly. Table 1 provides a summary of DSM-IV problem gambling criteria that I have outlined and the likelihood of identification of specific problem gambling behaviours online. The table highlights that only two criteria have a high likelihood of being identified online (salience/preoccupation and chasing losses), two criteria have some possibility of being identified online (tolerance and relapse), one criterion has a slight possibility of being identified online (bail out), and that five criteria have little likelihood of being identified online (experiencing withdrawal symptoms, escaping from reality, concealing involvement, engaging in unsociable behaviour, and ruining a relationship/opportunity) unless such behaviour is talked about in the online chat rooms. Despite the fact that the DSM-IV criteria reliably identify relatively few problem gambling behaviours, there are other online behaviours that are likely to be indicative of problem

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gambling. It is likely that the more these online behaviours are detected, the more likely the person is a problem gambler. The following list was derived from information supplied by a number of gaming operators that I have worked with over the last few years. This list includes the online gambling behaviours already identified above in relation to online problem gambling and the DSM-IV criteria. The online behaviours that appear to be most associated with online problem gambling are: (i) chasing losses, (ii) total preoccupation with gambling, (iii) increase of gambling behaviour over time, (iv) playing with a variety of stakes, (v) playing a variety of games, (vi) player ‘reload’ of money within a gambling session, (vii) frequent payment method changes, (viii) verbal aggression within chat rooms, and (ix) constant complaints to customer complaints. These are each briefly examined below. (i) Chasing losses – As mentioned earlier, this is one of the key Indicators (if not the key indicator) of problem gambling behaviour online. The ‘classic’ behavioural indicator here is a significant increase in bet size following losses. This is one of a number of cue-related chasing behaviours and is common among online problem gamblers. As this behaviour is most likely to signal problem gambling it is unlikely that someone could be labelled a problem gambler without this particular behaviour being present. (ii) Total preoccupation with gambling – Clearly excessive gambling and the consequences are typical among online problem gamblers (i.e., lots of betting, gambling, spending in series of prolonged and/or frequent sessions then a period of quiet with no betting as they have no funds and are preoccupied with dealing with consequences of losing). (iii) Increase of gambling behaviour (time and/or

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>> FROM THE PERSPECTIVE OF GAMING OPERATORS, ANY INTERVENTION IN THE CASE OF A SUSPECTED PROBLEM GAMBLER USING BEHAVIOURAL TRACKING TECHNOLOGY WILL BE A SENSITIVE ISSUE. THIS IS EVEN MORE THE CASE IF THE INDIVIDUAL IN QUESTION IS A ‘PREMIUM’ CUSTOMER WHO SPENDS A LOT OF MONEY ON INTERNET GAMBLING SERVICES (AND MAY BE A PROBLEM GAMBLER). HIGH SPENDING ON GAMBLING IS NOT NECESSARILY (IN ITSELF) PROBLEMATIC, PARTICULARLY IF THE PLAYER IN QUESTION CAN AFFORD IT. THE REAL ISSUE IS WHETHER THE BEHAVIOUR BECOMES PROBLEMATIC. >> money) over time – This behaviour (identified earlier as a form of tolerance) may be indicative of online problem gambling. A problem gambler is more likely to gamble for longer and longer periods of time with bigger and bigger amounts of money. The reason this is important in identification of problem gambling is that it is a behaviour that is likely to change over time and get progressively worse. (iv) Playing a variety of stakes – Playing a variety of different stakes (in games like online poker) indicates poor planning and may be a cue to chasing behaviour. (v) Playing a variety of games – Evidence from national prevalence surveys like the most recent British Gambling Prevalence Survey (Wardle et, al, 2007) suggests that the more types of gambling engaged in, the more likely the person is to be a problem gambler. Although this factor on its own is unlikely to indicate problem gambling, when combined with three or four other indicators on this list it may be indicative of problem gambling. (vi) Player ‘reload’ of money within gambling session – Although any gambler can engage in such behaviour, players who deposit more money within session (i.e., ‘reload’) appear more likely to be problem gamblers. This indicates poor planning and is a cue to chasing behaviour. This behaviour needs to be examined in relation to three or four other indicative behaviours. (vii) Frequent payment method changes – The constant changing of deposit payment methods indicates poor planning and may be another cue to chasing behaviour. This online behaviour usually indicates shortage of funds and the need to extract monies from a variety of sources. Such behaviour can also indicate bank refusal. This behaviour needs to be examined in relation to at least three or four other indicative behaviours on this list. (viii) Verbal aggression within chat rooms – Aggressive verbal interaction via in-game relay chat facilities is common among problem gamblers although any gambler losing money may trigger such behaviour. This behaviour needs to be examined in relation to other indicative behaviours outlined here. Such behaviour may be evidence of gamblers going on ‘tilt’ (i.e., negative cognitive and emotional reaction to losing or withdrawal effects if they run out of money to gamble). (ix) Constant complaints to customer services – Constant complaints to the customer service department appears to be common among problem gamblers although any gambler losing money may cause such behaviour. Again, this behaviour needs to be

examined in relation to three or four other indicative behaviours. As with verbal aggression, such behaviour may be evidence of gamblers going on ‘tilt’ (i.e., negative cognitive and emotional reaction to losing). Perhaps most importantly, it is a significant change in usual behaviour that is most indicative of a problem gambler. Most statistical modelling of player behaviour (e.g., PlayScan) predicts future problematic behaviour on the basis of behavioural change over time. The behaviours highlighted in this section suggest that future screening instruments may be able to be developed that concentrate on the gambling behaviour itself, rather than the associated negative consequences. IMPLICATIONS FOR SOCIAL RESPONSIBILITY IN THE ONLINE GAMING INDUSTRY From the perspective of gaming operators, any intervention in the case of a suspected problem gambler using behavioural tracking technology will be a sensitive issue. This is even more the case if the individual in question is a ‘premium’ customer who spends a lot of money on Internet gambling services (and may be a problem gambler). High spending on gambling is not necessarily (in itself) problematic, particularly if the player in question can afford it. The real issue is whether the behaviour becomes problematic. Recommendations made elsewhere about how to be socially responsible online (e.g., Griffiths, 2007) are initiatives that (a) minimise harm (both time and money), and (b) highlight behavioural transparency as a way of getting the gamblers themselves to come to a decision about whether they need help for their gambling. Another advantage of having online (rather than offline) clientele is that help and intervention can also be online. This automatically reduces feelings of stigmatisation for the gambler. Gaming companies can e-mail their customers who are identified as having a possible gambling problem and inform them that as part of their social responsibility framework, they routinely e-mail customers if there has been a significant change in their gambling behaviour over a specified period (usually four to six weeks). The e-mail is therefore sent as a consequence of the social responsibility policy surrounding behavioural transparency for customers. Such e-mails do not make any reference to the behaviour being problematic per se, but can simply highlight that the amount of time and/or money spent by the gambler has increased significantly over the specified time period. Furthermore, the bottom of the e-mail can include hyperlinks to social responsibility tools (such as a self-diagnostic Casino & Gaming International I 103

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gambling checklist) and/or gambling agencies that specialise in helping problem gamblers. Information regarding an individual’s gambling behaviour can be accessed through their ‘My account’ section on the gambling website and should include a multi-layer analysis of a customer’s gambling behaviour on both micro- and macrolevels. The ‘My Account’ page should provide a snapshot of gambling behaviour for the previous month’s gambling sessions (e.g., profit and loss, and a list of financial transactions). Even customers who choose to ignore gambling expenditure are provided with a true (and in some cases stark) indication of their level of gambling involvement regarding time and money. Information should be readily accessible to gamblers so that they can evaluate gambling behaviour on a micro-level because the precise details of each wager (including the outcome) will be available for close inspection. E-mails clearly identifying the amount of time and money spent gambling should be made available instantly. Continual acknowledgement of actual behavioural contingencies in gambling behaviour is essential to minimise development of erroneous cognitive biases and therefore reduce irresponsible gambling behaviour (Griffiths, 1994; Parke, Griffiths & Parke, 2007). The whole process is about gamblers coming to an awareness themselves about their gambling behaviour. It is not a gaming company’s job to treat problem gamblers. However, it is their job to help players analyse their own behaviour and provide a helping hand towards referral services should that be desired by the customer. This article attempted to highlight the role of behavioural tracking technologies in identifying problem gamblers. Furthermore, it has suggested that if problem gambling can be identified online without the use of diagnostic gambling screens, then this may have implications for the development of problem gambling screening instruments in the future. No longer will screening instruments rely on the consequences of problem gambling, they may be based on the behaviours that problem gamblers actually engage in while gambling. It has also been argued that being online may also be beneficial for gaming operators helping in the case of suspected problem gamblers since online interventions are likely to be less stigmatising for the gambler than any face-to-face approach. CGI REFERENCES American Psychiatric Association. (1994). Diagnostic and Statistical Manual of Mental Disorders (4th ed.). Washington, DC: Author. Griffiths, M.D. (1994). The role of cognitive bias and skill in fruit machine gambling. British Journal of Psychology, 85, 351-369. Griffiths, M.D. (2003). Internet gambling: Issues, concerns and recommendations. CyberPsychology and Behavior, 6, 557-568. Griffiths, M.D. (2007). Responsible online gambling and best practice. World Online Gambling Law Report, 7(1), 3-4. Griffiths, M.D. & Parke, J. (2002). The social impact of internet gambling. Social Science Computer Review, 20, 312-320. Griffiths, M.D., Parke, A., Wood, R.T.A. & Parke, J. (2006). Internet gambling: An overview of psychosocial impacts, Gaming Research and Review Journal, 27(1), 27-39.

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Griffiths, M.D. & Wood, R.T.A. (2008). Responsible gaming and best practice: How can academics help? Casino and Gaming International, 4(1), 107-112. Griffiths, M.D., Wood, R.T.A. & Parke, J. (2009). Social responsibility tools in online gambling: A survey of attitudes and behaviour among Internet gamblers. CyberPsychology and Behavior, in press. Griffiths, M.D., Wood, R.T.A., Parke, J. & Parke, A. (2007). Gaming research and best practice: Gaming industry, social responsibility and academia. Casino and Gaming International, 3, 97-103. Parke, J., Griffiths, M.D. & Parke, A. (2007). Positive thinking among slot machine gamblers: A case of maladaptive coping? International Journal of Mental Health and Addiction, 5, 39-52. Smeaton, M. & Griffiths, M.D. (2004). Internet gambling and social responsibility: An exploratory study, CyberPsychology and Behavior, 7, 49-57. Wardle, H., Sproston, K., Orford, J., Erens, B., Griffiths, M.D., Constantine, R. & Pigott, S. (2007). The Briish Gambling Prevalence Survey 2007. London: The Stationery Office.

MARK GRIFFITHS Dr. Mark Griffiths is a Chartered Psychologist and Europe’s only Professor of Gambling Studies (Nottingham Trent University). He is Director of the International Gaming Research Unit and has won many awards for his work including the John Rosecrance Research Prize (1994), International Excellence Award For Gambling Research (2003), Joseph Lister Prize (2004), and the Lifetime Achievement Award For Contributions To The Field Of Youth Gambling (2006). He has published over 210 refereed research papers in journals such as the British Medical Journal, British Journal of Psychology, British Journal of Social Psychology, British Journal of Clinical Psychology, Journal of Community and Applied Social Psychology, British Journal of Sports Medicine, Personality and Individual Differences, Archives of Sexual Behavior, Journal of Adolescence, Addictive Behaviors, British Journal of Addiction, Addiction Research, CyberPsychology and Behavior, Journal of Psychology and extensively in the Journal of Gambling Studies. He has served as a member on a number of national and international committees (e.g. European Association for the Study of Gambling, Society for the Study of Gambling, Gamblers Anonymous General Services Board, National Council on Gambling etc.) and was former National Chair of Gamcare (1997-2003). He also does some freelance journalism (120+ articles published) and has also appeared on over 1,800 radio/TV programmes.

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PROBLEM GAMBLING IS UNDERSTOOD, SO GETTING US BETTER KNOWN IS VITAL BY ANDY MCLELLAN

There is no level of problem gambling that can be deemed tolerable. For the gaming industry generally – and paradoxically to some – it is more than essential to be vigilant in detecting and resolving gambling behaviour issues when they arise. But while extensive industry support underlies mitigating efforts, the agencies tackling the realities of addiction cases require a much greater profile to be effective and preventative.

he last five months have been a steep – and fascinating – learning curve since despite a previous consultancy role I did not have much direct contact with what it is really like to be a problem gambler. So I hope, by sharing my experience with you, that I might help to provide answers to some key questions:

• • • •

How big is the problem? What is it like to be a problem gambler? What help is available? What can we all do to get more people to seek that help?

WHAT’S ALL THE FUSS ABOUT? There is one, fairly well-known statistic about problem gamblers – that there are around 250,000 in Great Britain, and that this hasn’t changed since 1999. The source for this is the Gambling Commission’s 2007 Prevalence Study. Many people, when I told them about my new job, said to me: “That’s not many – so why all the fuss about them?” Good question, I thought – and here are some of the answers: •

•

The survey is a snapshot at a point in time – problem gambling is dynamic, with individuals moving in and out all the time. Problem gambling also affects partners, families and friends – if every gambler has an impact on just four others (a conservative estimate) that means 1.25 million people are affected. The survey also found that a further 1.4 percent of the population – over 660,000 people - were at “moderate risk” of becoming problem gamblers, and 5.1 percent over 2.4 million people - displayed some risk factors. Casino & Gaming International I 105

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>> WE PROVIDE SUPPORT TO THOSE AFFECTED BY PROBLEM GAMBLERS AS WELL AS TO GAMBLERS THEMSELVES. BUT WE NEVER FORCE PEOPLE TO REVEAL THEIR IDENTITIES, WE NEVER TALK TO ANYONE ELSE ABOUT THE CONVERSATIONS WE HAVE WITH ANY INDIVIDUALS, AND WE ALWAYS RESPECT CONFIDENTIALITY. NOR DO WE REGARD GAMBLING AS EVIL: GAMBLING IS LEGAL AND MANY FIND IT A THOROUGHLY ENJOYABLE LEISURE ACTIVITY. A FEW FIND IT DEVELOPS INTO A PROBLEM, AND IT IS THESE THAT WE WANT TO HELP. >>

•

Current best estimates suggest that only between 0.5-1 percent of those in need of treatment actually embark on a treatment programme. We’re hardly scratching the surface.

A final point: this compares with around 327,000 problem drug users in the UK (British Crime Survey) – and the impact of a gambling addiction on the individual, their family and their friends can be just as traumatic, just as painful as drug addiction. WHAT MAKES A PROBLEM GAMBLER? Reassured that there is a real and pressing problem that needs to be dealt with, I set about finding out what makes a problem gambler. Here I had the benefit of being able to talk to GamCare’s team of expert advisers and counsellors, who have been working with problem gamblers now for over 11 years. Their experience and wisdom is borne out by much recent research as well. All problem gamblers are individuals. But there are general ‘types’ of gambler. A recent research report has identified four categories: • •

• •

“peripheral” or social gamblers, doing it for fun, in control, not at risk; “enthusiasts” who gamble frequently but feel no compulsion to do it, who enjoy it and particularly like games of skill; “business” gamblers who are similar to enthusiasts but who want to make money; “compulsive” gamblers who find that gambling becomes the central and controlling feature of their lives.

Other researchers have identified similar categories. People move between categories, but a consensus now seems to be emerging that there isn’t a progressive pattern over time (eg recreational – moderate – compulsive). People can move backwards or forwards through the categories, and it is a question of understanding what triggers those changes in behaviour that is the key to helping problem gamblers. There are some common factors which lead people into problem gambling. These might be to do with the novelty of new forms of gambling, or finding it easier to access or pay for gambling. They might also be to do with increased exposure to gambling, perhaps because of mixing with a different group of friends or taking up new activities where gambling is available. 106 I Casino & Gaming International

But researchers, my counsellors especially, emphasise the importance of the individual’s personal circumstances, and particularly sudden or unexpected changes in those circumstances. Perhaps most importantly, gambling is very often a coping behaviour, an escape from other, deeper personal issues to do with relationships, self-esteem, stress, financial worries and so on. The similarities with addiction to drugs or drink are therefore clear: gambling can provide a respite, an escape, even a feeling that ‘this is one area of my life where I can do what I want’. In a strange way, it allows some people to feel they are in control, when from the outside it looks as if the gambling is controlling them. But there is also a key difference. Like drink and drugs, gambling can lead to debt – people gamble their wages, their savings, their house, their children’s birthday money. But gambling can also be seen as the way out of debt as well – if you have lost your job, lost your wife, been refused benefits, what else can you do to pay off the loan shark? So gambling can appear to be the only way out of the difficulties that the gambling itself has created, or made worse, in the first place. HOW CAN GAMCARE HELP? GamCare runs two key services that are vital for problem gamblers. Our HelpLine (0845 6000 133) is available from 8–12 Midnight, every day of the year, right across the country. It is promoted in every gambling establishment in the country, on machines, posters, leaflets and online. In 2008 we answered over 34,000 calls – over 20 percent more than in 2007. Our advisers don’t just give information: when people call they are often in a moment of crisis, desperate about their plight and not knowing what to do next. Some are suicidal. Our advisers are specially trained to give emotional support, to spend how ever long it takes with the caller to help them through the crisis and then to try to help them find more help and support – whether that be debt or financial management advice, help from Gamblers Anonymous, residential treatment or one to one counselling. All this is free and completely confidential. We also now offer an online helpline (NetLine) for those who want to contact us that way for real time help and support. People can also join our Forum and Chatroom – this type of group support often really helps people to realise they are not alone, and that others have faced and conquered similar problems. Our second service is counselling, face to face or online.

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In London, our team of professional counsellors works with over 100 individuals every week, mostly on an individual basis though we also offer group work for those who might benefit (our Women’s Group has been running now for more than two years). Our counsellors focus on the individual. They help clients to develop strategies to control and manage their gambling, or to give it up. But this might only be a shortterm fix. They also help clients to identify and grapple with the underlying issues that gambling may be a symptom of, or a cover for. It is only by identifying and addressing these issues that people are able to regain control of their lives and so prevent problems recurring in the future. Around the country we work with a network of Partners, normally addiction counsellors with experience of working with drink and drugs whom we fund, train and support to add problem gambling therapy to their expertise. Sadly, this network still only reaches 60 percent of the country due to lack of funds – large parts of the country, particularly in Wales and the South West, still do not have access to specialist counselling. The HelpLine and counselling have been built up over the years thanks to the support and funding provided by the industry. We work very closely with all types of operators and trade associations, who provide the money to build and develop our services and who also work with us to publicise them. But there is more that we can do for the industry: •

We provide training and support for staff working on the front line, in call-centres and in management, helping them to understand problem gambling and the requirements of their licences, helping them to recognise the signs that people may be running into trouble, helping them to tackle issues of under-age gambling, and helping them to develop their responsible gambling policies.

•

We will assess an operator’s responsible gambling policies, training and practice, advise on how they might be improved and award GamCare certification to those who meet our standards – a signal to the regulator and Government that they are serious about responsible gambling, and an assurance to customers that the operator is one they can trust.

So while our main focus is on treatment, we also do a lot to help the industry to prevent people from becoming problem gamblers. This is a partnership we value, one we have nurtured over the years and one which is vital to our success in the future. SO WHY AREN’T WE OVERRUN? The first answer to that is that we are! We aren’t able to answer all the calls we receive at the busiest of times – though our performance is improving. We have waiting lists for counselling in London, and demand is growing across the country as we have developed and built our Partnerships. We are meeting this demand as far as funds allow – we have recently opened an office in Salford providing counselling for people in the Greater Manchester area, and new Partnerships have come on stream elsewhere. I have also increased HelpLine and counselling staffing in London. But, as I said earlier, we are still only scratching the surface of the problem. Less than one percent of people who

need our help come forward for it. Even if this estimate is out by 100 percent, or even 1000 percent, it is just not acceptable. So why don’t they contact us? Again, recent research is interesting. Many people who need help are put off because they are reluctant, or too ashamed, to admit they have a problem, or they feel they should deal with it themselves (particularly men!), or they don’t think they can be ‘cured’. Others are worried that helplines and counselling are not confidential, that wives or husbands or even ‘the authorities’ will be informed, that individual counselling isn’t available and they’ll be forced to stand up in a group and say ‘I’m a problem gambler’. All this is nonsense – but people, too many people, still believe it. Many of the calls to our HelpLine come not from the gamblers themselves but from their wives or husbands, their mothers or grandfathers, their children. Research has shown the important role which families and friends can play in helping people to recognise their problem and take steps to deal with it. We provide support to those affected by problem gamblers as well as to gamblers themselves. But we never force people to reveal their identities, we never talk to anyone else about the conversations we have with any individuals, and we always respect confidentiality. Nor do we regard gambling as evil: gambling is legal and many find it a thoroughly enjoyable leisure activity. A few find it develops into a problem, and it is these that we want to help. The most worrying facts are these: research which we have recently commissioned, and will soon be publishing, suggests that awareness amongst gamblers of GamCare’s services is still woefully low, and that information is simply not reaching the right people. Perhaps most worryingly, this includes other front-line professionals (GPs, debt counsellors, Citizens Advice Bureaux, social services) most of whom have no idea that help is available for people with gambling problems. WHAT CAN WE DO? Unusually for the CEO of a charity I don’t think overall levels of funding are the problem. The industry has committed itself to raising at least £5m a year in 2009/10 and in each of the next two years, and we are working with them to help in their fundraising efforts. I hope, and believe, they can exceed their targets! We have always advocated and supported a voluntary system for fundraising from the industry, and believe this can and will work. There is a problem with cashflow at the moment, as the new systems are still being set up for raising and distributing funds. This is causing particular difficulties for us and our partners, and also for other treatment providers whose funding for 2009/10 is less than is needed to keep existing services going. We are continuing to set out our case to the three new organisations that have been set up (the fundraiser, the distributor and the Strategy Board) and believe there is room for more flexibility – it would be ironic, and depressing, if the first real impact of the new structures created following the Gambling Commission’s review of research education and treatment was a reduction in existing services rather than the expansion that everyone acknowledges is needed. The bigger issue, though, is raising awareness. Here I believe the partnership between GamCare and the industry is vital. The investment already made in on-site publicity – on Casino & Gaming International I 107

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machines, publicity materials etc – is clearly vital, but also clearly isn’t enough. We need to work with you to make a bigger and sustained impact. This needn’t imply big money – agreeing a standard responsible gambling message and including GamCare’s HelpLine in all advertising and publicity would be virtually cost-free, but would vastly increase reach and awareness. (Indeed, I believe this is a requirement in many other countries in the English-speaking world.) We are already discussing with industry associations a concerted, industry-wide effort to raise awareness, working with all the treatment providers around the country and perhaps with the focus of a regular Responsible Gambling Day, and national and regional awareness-raising events. By pooling our efforts and resources we can make a significant difference. We also need to educate GPs, social services, debt counsellors and other front line advisers on problem gambling and the help available. We ran a successful pilot last year to explore what might work. Our proposals for rolling this out across the country are with the distributor. It would cost around £200k; the impact would be considerable. To sum up: gambling gives a lot of enjoyment to a lot of people. For a few, though, it can be a problem and for them it can create other problems as well. We can help these people, but they need to know we are here, and how to contact us. We can work with the industry to make people aware that help is available, and to help them help their customers to gamble responsibly and safely.

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British Gambling Prevalence Survey 2007, Gambling Commission.

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ANDY MCLELLAN Andy McLellan joined GamCare in February 2009, and before that acted as a strategic consultant to the charity. He has had over 20 year’s Civil Service experience, working closely with Ministers. Within the Department for Culture, Media and Sport he was responsible for policy and legislation on gambling, the National Lottery, broadcasting and tourism. Andy was also Director of Finance & Planning for DCMS, and Chief Operating Officer for the Royal Parks Agency.

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