Gaming America Jan/Feb 2022 by Gambling Insider

GamingAmerica.com

Jan/Feb 2022

THE LEADING PIECES We speak to Soo Kim and Derek Stevens, two executives at the heart of the industry, for a top-down view of US gaming

• Q&A: ENTAIN CGO ROBERT HOSKIN • PAUL BURNS ON A HUGE YEAR FOR CANADIAN GAMING 1 GAMINGAMERICA

• YANIV SHERMAN ON US-EUROPEAN RELATIONS IN GAMING • FLYING HIGH: THE RISE OF AIR CHARTERS?

COO, EDITOR IN CHIEF Julian Perry SENIOR STAFF WRITER Cameron Saunders Cameron.Saunders@gamingamerica.com

EDITOR’S LETTER

STAFF WRITERS Henry Moore Henry.Moore@gamingamerica.com Michael Bartlett Michael.Bartlett@gamingamerica.com LEAD DESIGNER Brendan Morrell DESIGNERS Olesya Adamska, Christian Quiling DESIGN ASSISTANTS Radostina Mihaylova, Svetlana Stoyanova

JULIAN PERRY, COO, Editor in Chief

MARKETING & EVENTS MANAGER Mariya Savova IT MANAGER Tom Powling COMMERCIAL DIRECTOR Deepak Malkani Deepak.Malkani@gamblinginsider.com Tel: +44 (0)20 7729 6279 US BUSINESS DEVELOPMENT MANAGER Aaron Harvey Aaron.Harvey@playerspublishing.com Tel: +1 702 425 7818 SENIOR ACCOUNT MANAGERS Michael Juqula Michael.Juqula@gamblinginsider.com Tel: +44 (0)20 3487 0498 Martin Dilleigh Martin.Dilleigh@gamblinginsider.com Tel: +44 (0) 203 435 5628 ACCOUNT MANAGERS William Aderele William.Aderele@gamblinginsider.com Tel: +44 (0)20 7739 2062 Clive Waite Clive.Waite@gamblinginsider.com Tel: +44 (0)20 7729 0643 BUSINESS DEVELOPMENT MANAGER Michelle Pugh Michelle.Pugh@gamblinginsider.com Tel: +44 (0)20 7739 5768 SENIOR ACCOUNT EXECUTIVE Sam Ford Samuel.Ford@GamblingInsider.com Tel: +44 (0) 207 739 9918 CREDIT MANAGER Rachel Voit WITH THANKS TO: Soo Kim, Derek Stevens, Paul Burns, Oliver Lovat, Mandi Hart, Christopher Justice, Joe Lupo, Robert Hoskin, Rukku Rupanagudi, Andrew Burke, Rachel Barber, Cath Burns, Yaniv Sherman, UNLV, Jeanne Muscolino, Mike Larson, Gus Petropoulos, Cath Burns, Dave Kubajak, Dan Schrementi, Casey Clark, Andrew Burke, Johnny Ayers, Michael Tobin, Tiffany Sadler, Tracey Chernay, Chad Hoehne, Stuart Hunter, Mike Kaplan

So, after a restful break, it's back to the coalface for 2022. We at Gaming America would like to wish everyone a Happy New Year – and if the predictions our analysts made in the Nov/Dec 2021 issue bear fruit, it could be some year indeed for US gaming. In our first edition of this much-anticipated 12-month period, we cover a breadth of themes and topics we feel are most prevalent within the US right now. Gaming is becoming more interconnected as players interact more with the operator; cashless is continuing to grow; and big casino moguls are actively transforming casino properties into an overall entertainment venue, rather than just a gambling outlet. There is, naturally, a further emphasis on sustainability, especially from operator giant Entain. Meanwhile, among the many losses and negatives brought about by the (still ongoing) Covid-19 pandemic, we explore one positive: the resultant technological innovation being spurred on by necessity. We also bring landmark names for you in this issue, Global Gaming Award winners in fact, as Bally's Chairman Soo Kim and Circa Owner Derek Stevens give an insight into their careers and plans for key casinos across the US. The duo join fellow Gaming America interviewees in Jan/Feb such as Yaniv Sherman, Entain CGO Robert Hoskin, Canadian Gaming Association CEO Paul Burns and more. Regular columnist Oliver Lovat adds to the cashless discussion, among many other technology-related topics, on p18, while our roundtable includes Aristocrat, IGT, Bluberi, OPTX and the American Gaming Association, as they too give their verdicts on the burgeoning technology shaping our industry. Executives looking for in-depth features should find plenty to sink their teeth into, as our stellar writers explore: on p32, cashless (note that's the third time I've used the word in this letter, to emphasise how heavily discussed the topic is becoming), on p44 casino architecture, on p42 sports betting and payments, on p34 private casino air charters and, on p46, generally previewing the year ahead. So, while we've dedicated our cover interviews to the leading pieces, we're still very much keeping our eye on the whole chessboard here at Gaming America. JP, Editor in Chief

FEATURED IN THIS ISSUE

Gaming America magazine ISSN 2632-766X Produced and published by Players Publishing Ltd All material is strictly copyrighted and all rights reserved. Reproduction without permission is forbidden. Every care is taken in compiling the contents of Gambling Insider but we assume no responsibility for the effects arising therefrom. The views expressed are not necessarily those of the publisher.

SOO KIM

Chairman, Bally's Corporation

RACHEL BARBER

SVP and CTO, Gaming and Lottery, IGT

CHECK GAMINGAMERICA.COM FOR THE BEST IN BREAKING NEWS

CONTENTS  8 12 14 20

FROM THE TOP We speak with Clarion's Stuart Hunter about the postponed ICE London trade show.

THE KING IN THE NORTH

CHANGE IS IN THE AIR

HIGH FLYERS

ROUNDTABLE: TECHNOLOGY

GROWING TOGETHER

THE GAME OF DESIGN

SHUFFLING OUT THE LOTTERY

REVENUE IN REVIEW

LEGAL ROUND-UP

NEW YORK ROUND-UP

PANEL: THE FUTURE OF MACAU

2022: GROWTH MODE

PRODUCT REVIEWS

THE STATE OF TRIBAL GAMING Gaming America looks at the state of tribal betting across the US.

INTERVIEW: SOO KIM We speak to the Bally's Corporation Chairman, the first of our "leading pieces."

INTERVIEW: DEREK STEVENS The charismatic entrepreneur speaks to us about the Circa sportsbook and his history of investment in Downtown Las Vegas.

THE OLD NEW CASINO Regular Gaming America contributor Oliver Lovat runs through everything gaming executives need to know with regards to industry technology in 2022.

SEEKING SUSTAINABILITY Gaming America speaks with Entain's Chief Governance Officer Robert Hoskin about the operator's new sustainability drive, which it has been making a lot of noise about of late.

EUROPEAN CAPITAL, AMERICAN GROWTH Gaming veteran and long-time 888 Holdings exec Yaniv Sherman discusses the convergence of US and European companies.

8 6 GAMINGAMERICA

It's a huge year for regulated gaming in Canada – Gaming America gets the lowdown from Paul Burns, head of the Canadian Gaming Association.

A number of companies speak to Gaming America about one of the most talked-about trends in our sector: cashless payments.

With Hard Rock and MGM Resorts using their own private air charters in Atlantic City, we explore the advantages – and sustainability – of this new trend.

The industry is changing. How?

What makes a better bettor for a payments company? Someone who loves to wager on sports, or someone who prefers iGaming?

What trends are defining the land-based landscape? We speak to JCJ Architecture to find out more.

In his first column for Gaming America, lawyer Gus Petropoulos explores the M&A strategies of Scientific Games (a firm he advised in the past) and IGT.

Gaming America looks at how states choose to spend their hard-earned sports betting tax dollars.

We round up the latest from PlayUp's legal dispute with Laila Mintas.

The biggest sports betting market in the US has now launched online. We review the first stage of this launch.

How will US operators based in Macau be affected by regulatory changes in the region?

Gaming America takes an overarching look at the year ahead for US gaming.

What's new in the industry? We look at five hot-off-the-press products.

FROM THE TOP

FROM THE TOP:

AS ICE POSTPONED, ORGANIZERS STAY READY Officials had Covid-19 protocols in place, still championing importance of in-person events. The new London ICE dates are 12-14 April. Covid has affected every part of our lives the past two years and print magazines are no exception. Gaming America had a tidy preview of ICE London all ready to go in our January/February issue, when news broke that the show would be postponed from the first three days of February until dates TBD in late spring. Because so much of the discussion between Michael Bartlett and Stuart Hunter, Managing Director at Clarion Gaming, focused on health and safety protocols – and the importance of the gaming industry getting together for in-person conferences – it still makes for a relevant read ahead of April's potential show.

"ESPORTS IS GOING TO BE ONE OF A NUMBER OF REALLY COMPELLING FEATURES AT THE SHOW AND WHICH SET THE ICE LONDON EXPERIENCE APART FROM OTHER EVENTS ON THE GAMING INDUSTRY CALENDAR." G2E in Las Vegas required every attendee to supply proof of vaccination and all persons had to wear masks at all times in conference areas... will ICE have similar restrictions? If so, what types? Obviously Covid protocols must have the flexibility to be able to respond to what is a dynamic and rapidly changing scenario. In line with current [as of early December] UK Government 8 GAMINGAMERICA

advice, we will be requiring everyone attending ICE London to demonstrate either a full vaccination record, a recent negative test result or recent recovery certificate. UK-based visitors can use their NHS Covid Pass and international visitors can use the equivalent from their country of origin. Printed paper certificates will also be accepted. There are two testing centers in close proximity to the ExCeL; at London City Airport and at the O2 Arena. Our team is also investigating having our own testing center on-site, details of which we will update online.

Several of the companies I spoke with at G2E were planning to make ICE their next conference... Does ICE normally get a lot of folks to come over from the US? One of the stand-out characteristics of ICE London is its internationalism. The last edition featured exhibitors from 65 countries and welcomed a total of 155 nationalities. While the majority of visitors are from the UK as host nation, and continental Europe as the nearest geographical neighbor, the ability to see every gaming vertical in one place means ICE London attracts senior gaming professionals from throughout the world, including those from the US. Interestingly, we saw a significant early spike in attendee registrations from the US compared to the last ICE event in 2020, indicative of the interest in attending what will be the first truly global gaming trade show for two years.

Will the attendee count for exhibitors and visitors be the same as 2019 and in previous years? Some of our long-standing customers won’t feel able to travel to London and this is something we totally respect and understand fully. Although we cannot predict how the response to Covid will impact attendance, what we can say with absolute certainty is the positive, upbeat and optimistic

FROM THE TOP

mindset that exists within the ICE London community. The Clarion Gaming team is spending a huge amount of time reaching out to its clients and reaching out to the visitor community, simply to see how things are progressing and how business is shaping up. In addition, we have close contact with upwards of 50 international trade associations and representative bodies such as the European Casino Association, and of course we are able to track the registration data against that of previous years. Taking all of this into account we are seeing great positivity about the return of in-person events and in particular

the return of ICE London. In the events sector, there’s a definite and pronounced move away from the use of attendance figures as the measure of whether a business-to-business show has been successful or not. For example, we could easily add 30%-40% to our audited attendance figures if we relaxed the business-to-business only ruling, but it clearly would not make that edition a “better” or “more successful” show. To move away from the raw data of attendance, we are looking at measuring the quality of the experience and the level of advocacy, which essentially relates to the propensity of GAMINGAMERICA 9

FROM THE TOP

attendees to recommend ICE London to colleagues. If you have 40,000 attendees but only 10% valued the experience – that’s a long way from being a good show and the Event Director would probably find him/herself shown the door marked Exit!

Let’s talk about excitement and energy as it relates to ICE: If anyone was put off by the vaccine requirement for G2E, it didn’t show. Judging by the ICE website, officials are expecting a similar vibe. Are you getting any feedback as people register? 'Together never felt so good,' which is the theme of our creative in support of ICE London 2022, really captures the

'onsite experience,' courtesy of enhanced feature content, new feature content and enhanced networking via our MYICE digital networking tool.

One person at G2E told me the show attracted more top-level executives than usual because the 2020 version of the conference had been cancelled... are you expecting a similar turnout? Registration was tracking ahead of where we were at the same stage of the campaign in support of ICE 2020. Drilling down into who is registering for ICE London, we are definitely seeing more decision makers and more of gaming’s C-suite signing up to be part of the ICE experience earlier than ever before.

What are you expecting to be the big themes of this year's ICE?

"TOGETHER NEVER FELT SO GOOD,' WHICH IS THE THEME OF OUR CREATIVE IN SUPPORT OF ICE LONDON 2022." mood of the industry. At iGB Live!/iGB Affiliate Amsterdam, which we organized at the end September, the level of excitement was tangible. You could hear it in people’s voices and see it in their faces. There’s no doubt there’s a strong appetite for the return of in-person events [even if we now have to wait a little longer after the delay]. To reflect the excitement of the return of in-person, we are also making our biggest ever marketing and communications investment, maximizing the number of touch-points the brand has with the international industry; attempting to answer any misgivings, working alongside our exhibitors and amplifying the 'Together never felt so good' core campaign message. We are also investing in the 10 GAMINGAMERICA

A distinguished member of the international gambling industry famously described the ICE London show floor as' $bn of thinking' under one roof. That’s stuck with me because it really sums up why so many members of the international industry choose to come to London. Innovators timetable product launches to be debuted at ICE London, and the show has a proud record of having showcased all of the groundbreaking products and services that have transformed the sector. That commitment to innovation covers every gaming vertical, encompassing both online/mobile and land-based. Without wishing to sound glib or to talk in generalisms, visitors to London will have access to everything that’s new across every sector, whether it is slots, table games, cashless gaming or new technology. One of the really intriguing areas, and one that we have focused on, is the link between betting and esports. Esports was introduced to the ICE London show floor in 2020 and was subsequently deployed to iGB Live! in Amsterdam earlier this year. The statistics in terms of esports’ audience reach and the sheer size of the esports betting market are immense. Our job is to facilitate business growth and opportunity for our stakeholders and to do this we have employed a team of experts led by Will Harding, our head of esports and assisted by Jamie Coles, who has joined us from Red Bull. For ICE London 2022 we have pulled out all of the stops to secure the iconic Hyper X Esports Truck, aka “Big Betty,” to form the main stage for the professional players and keynote speakers who will be appearing at the show. Essentially, the 21-meter long classic American-style truck is an arena on wheels. It unfolds into a fully equipped esports studio and main stage, enabling us to reflect the culture, theatre and appeal of the esports phenomenon, which will be explained courtesy of the keynote speakers who will be sharing their insight with our B2B audience. Esports is going to be one of a number of really compelling features at the show and which set the ICE London experience apart from other events on the gaming industry calendar.

UNLV - ICGR

THE STATE OF TRIBAL GAMING WA

Washington

Only tribal casinos are permitted to operate sports betting.

OR ID WY

STATES WITH AUTHORIZED AND OPERATIONAL TRIBAL SPORTS BETTING (17 states) STATES WITH TRIBAL GAMING OPERATIONS (12 states) STATES WITH NO TRIBAL SPORTS BETTING OPERATIONS (21 states)

12 GAMINGAMERICA

UNLV - ICGR

Both tribal gaming and sports betting are experiencing periods of immense growth. Here we examine the states in which tribal operators can offer iGaming and sports betting, courtesy of information provided by the UNLV International Center for Gaming Regulation.

NEW YORK The seven tribal casinos located in New York state all operate retail sportsbooks. In 2021, New York authorized mobile sports betting.

ND MN

ME VT

NH MA

MI IA

NE IL KS

TN OK

SC MS

Florida

LA TX

Mississippi

The Seminole Tribe is currently involved in a legal dispute regarding the legality of its online sports betting operations in the state.

Tribal casinos in Mississippi were the first to launch sportsbooks following the US Supreme Court’s 2018 decision in Murphy v. NCAA. Information provided by the *University of Nevada's International Center for Gaming Regulation

GAMINGAMERICA 13

SOO KIM

BALLY’S CORPORATION TAKES ON THE FUTURE When he's not buying casinos, Bally's Corporation Soo Kim spends his days growing and refining his marquee company. He sat down with Gaming America to discuss the future of the industry, the future of his company, and what business a finance maven has being in the gaming industry. You have a history in finance. What skills are transferable from the world of finance to that of gaming? The casino business is not my full-time job, though I'm a very experienced investor in the space, I sit on boards, so what I do is the supervision and oversight. What I do not do is front-line casino management. We actually try to be pretty careful about that delineation. I think there are many skills that transfer to helping oversee a gaming company that can be learned from 14 GAMINGAMERICA

the investment management industry, but I’ll tell you one thing, one of those skills is not how to actually run the casino. So, we don’t actually spend a lot of time on getting involved operationally. Our job there is to make sure we have the right people, the right teams in place. We empower them. We hold them accountable. We reward them for success and we don’t if there’s failure. And we’re honest about that. Much of what we do on the operational side is supervision

SOO KIM

and accountability. Besides that, there is an element in the boardroom and with companies that revolves around the question of what to do with the money that we make. How should we invest it? Should we give it back to shareholders in the form of share buybacks or dividends? Should we take down our debt? Should we take on more debt? Should we buy another casino? Should we make online investments? Should we fix up our existing casinos? These capital decisions are very much in tune with the kind of capital decisions we – people in finance – make on the investing side every day. There is a pool of capital that we’ve been entrusted with. We will protect it and make it grow. We move it to where we think the opportunity is. I think companies can do with that process. It’s similar to what we try to do with a company when we sit on a board. How can we spend the money that we make?

But surely that’s a skill transferable to a lot of industries. So why gaming? My background is in restructurings and reorganizations, so in the large world of investment management, we do a smaller sub sector – turnarounds and restructurings. Mainly we do that with leveraged companies. A lot of the time the restructuring is necessary because there is a lot of debt, maybe there could be a bankruptcy involved. So that’s my subject matter knowledge. Gaming is actually an area that’s been a fertile field for us in terms of finding opportunities, mainly because it’s such a boom-and-bust kind of space. There are times when there is so much optimism and people build these huge things, and then – all of a sudden – there is a recession and a capital tightening. Then there is a bust. And we like boom-and-bust industries because the excesses, when they bust, provide us with opportunities for investment. Still, though, we like gaming because it is undergirded by a very solid base. It’s called consumer discretionary. That portion of your entertainment budget is pretty stable. Gaming was one of the first physical businesses to come back during Covid. It has proven itself over and over again to be, at its core, a very sustainable business. So, boom and bust with a sustainable core is, for someone like myself, a natural fit.

How has the rebranding from Twin Rivers Worldwide to Bally’s affected the thrust of the company? First, we were at one casino; then we were at two; then four. As we acquired more casinos, we knew one truism: GAMINGAMERICA 15

SOO KIM

a network of casinos would, in the medium run, benefit all of the individual component projects, like a team approach. When you actually have a diversified portfolio of casinos, it’s actually worth more than the sum of its individual parts. You would offer your consumer choices. It’s a statement of what you stand for and of what value you can offer to the consumer. If you think about it, all of the larger casinos are some sort of network. The Caesars and MGMs are domestic networks of casinos, and Wynn and Las Vegas Sands are Asia-Vegas networks of casinos. So, we are putting together our network of casinos: it’s four, eight, 12 and, now, 16. At each juncture we said, ‘at some point we’re going to rename all of our casinos, we’re just waiting for the right name.' There was a time when we had 15 casinos with 15 different names. It was evident that that was

of those things where there’s a certain ubiquity of media. In the supermarket aisle, the illusion of choice is important. Though everything is made by Procter & Gamble, you think 'that’s the cheaper soap, that’s the nicer soap.' But, online, where you have an unlimited number of offerings – and it’s not curated – having a singular brand offering helps us stand out. We already had in our minds the desire to have a single brand across the network. Our push onto online made that even more important.

Is the acquisition of Gamesys a move in the online direction? Gamesys makes us equal part offline and online. It is one of the leading international providers of online bingo, poker and iCasino and it mainly operates in Europe and Asia. It has very little presence in the US, and we love that because it is in sports betting where the money is actually made in this business.

"MY BACKGROUND IS IN RESTRUCTURINGS AND REORGANIZATIONS, SO IN THE LARGE WORLD OF INVESTMENT MANAGEMENT, WE DO A SMALLER SUB SECTOR – TURNAROUNDS AND RESTRUCTURINGS. MAINLY WE DO THAT WITH LEVERAGED COMPANIES." not a way to create a network effect with loyal customers and a singular image. We knew we needed to find the brand to do that. With the acquisition of Bally’s Atlantic City, that opened up the opportunity to buy the Bally’s brand across the board. Bally’s obviously had been one of the storied brands in gaming. We think it’s one with great versatility and much potential in terms of being revived. So we had 16 different brands and we knew we always wanted to find one, and it was one of those things where you know it when you see it. Finally, when the opportunity came up, we went for it, we said ‘that’s the one’: Bally’s. That’s in casino land, though. There’s one further point. I think in an omni-channel world – a business where you’re not thinking just about land-based casinos and physical networks, but also of the online business in the various states you’re operating in – there could be different benefits to a singular brand. Online, I think it’s much easier just to have one brand. It’s one 16 GAMINGAMERICA

We have a physical fleet here and we’re going to bring that together. In Europe, a platform like Gamesys comes around gaming, but in the US it really comes together around sports. Regulatorily, 30-something states have permission for sports betting, but only six states have permission for online casino. It’s going to be sports-led in America. But with the Gamesys technology and team, I think it’s going to be a wonderful combination, a combination that is poised to be ready for the future.

Do you see the US being more open to online casinos in the next five years? If you think about it, the US is very welcoming to online sports betting. The point I’ve been making is that ‘online’ and ‘sports’ are just adjectives. It’s still gambling, gaming, betting and that’s great business. The cynics would say, ‘oh, these are sportsbooks, they’ve been around forever and they don’t make that much money.’ The optimists would say that this is the first mobile gaming product, and mobile gaming is a game changer.

SOO KIM

It’s the difference between when baseball was only shown in stadiums and then it was shown on TV. Just as we still have stadiums, we will continue to have casinos but online will be huge. Mobile gaming uses the internet as the broadcast medium to push this out to everyone. It becomes ubiquitous. If people don’t see that this takes a very mature business – which is how I consider gaming – and turn it even more into a growth business, then I don’t think they’re looking close enough.

people submitting proposals didn’t actually do that. The other people we are competing against own very basic slot boxes which draw up a lot of money, but didn’t actually fill the requirement of keeping people in the market. What I would say is that I think we’ve already made a difference. Hopefully we will be chosen because of our positive attitude and our desire to listen to the city and push the groups. I think our bids must have leaked out because, having looked at the three other bids, they look like ours.

Does Bally’s have any new properties in its sights? Obviously, we are opportunistic investors, and it is part of the investment management approach that we bring to the company. There was a 12-18-month window of time when we bought every casino that went up for sale. We were the market. If anyone had a sale they needed to make, they sold it to us. Because we were the market, we got some really great prices, and the returns on those properties are going to be great. Now, frankly, those opportunities don’t exist anymore. The market has come back, confidence has returned. We were buying at record lows just 12 months ago. Now, we’re back at record highs. In a world where there are record highs, we’re not going to buy, we’re going to build. Among the projects that we have going on now are a proposal for Chicago and the Tropicana Las Vegas, which we are about to close on (which is really more of a land and redevelopment play). I think if there’s a casino going up in America, you can make the assumption that we will be looking at it very carefully and seeing if we can meet our rigorous capital return standards. So, it was buy versus build. We were buying, now we’re building.

Concerning the two proposals that you submitted for the Chicago casino, and then the one that is in the pipeline for New York City, how does someone in your position go about winning these contracts? With Chicago it’s pretty straightforward. Chicago is not our home turf, though we do have a property in Illinois on the border with Iowa, in Rock Island. So obviously here, we are competing against people who are familiar with that market. Hometown heroes. So how do we compete in a market like that? We put forward the best project we can. We came with two fully developed sites and I think we pushed the envelope in terms of size. The scale of our build leaking out caused others to want to try and build while offering more. Additionally, Chicago and Illinois have very strict minority employment guidelines and we exceeded them, a fact that has led others to do so, too. Look, what we would say is this: we are happy to build Chicago what they want. What they want is a destination resort, something that would bring people in from the surrounding areas and keep people in the city from going out to the surrounding areas (which is how it works right now). The other 18 GAMINGAMERICA

"BALLY’S OBVIOUSLY HAD BEEN ONE OF THE STORIED BRANDS IN GAMING." Did you just have more capital and that’s why you submitted two while everyone else did one? Yes, that’s right. Look, we’re a big company, we’re very strong, so we can make investments in development projects. Really, part of it was that we weren’t so familiar with Chicago, so we wanted to make sure that we gave them choices. As part of the RFP rules, we were not allowed to speak with the City Council people. We were only allowed to have a sit-down with the Mayor’s office. In that world, I did not want to pick a site that everyone hates, so we decided to pick two sites, fully develop them and then show them. Then we’ll go out and meet the community and gauge their reactions.

If you could put a casino anywhere in the five boroughs, where would you put it? In New York City, that’s different. It is my home and we do feel that we understand this community. We are going to make a strong push for one of the three downstate licenses. I’ll tell you, though, where we don’t think is a good place to build: I don’t think it should be in Manhattan and I don’t think it should be on Governors Island. I think both of those locations would limit their revenue potential and have an impact on the community that ultimately doesn’t need it there. We’re thinking something in more the outer boroughs, not in the center of town. You can drive there, connect there with public transportation. We like to do good business but we like to do it in the right way. I think in New York we have the opportunity to meet the community needs. We know the community well, we know the area, and we can build something that does right by both.

CIRCA RESORT & CASINO

HARNESSING THE GLITZ AND GLORY OF DOWNTOWN VEGAS Derek Stevens, CEO of Circa Resort & Casino, is fresh off building the first casino in Downtown Las Vegas in the last four decades. The casino has been a resounding success, winning North American Property of the Year at the Global Gaming Awards Las Vegas 2021. Now it is time for him to get down to what he loves: operating. Stevens took time out of his day to speak with Gaming America about the creation and execution of his marquee project. Coming from Michigan, what led you to seek your fortune in Las Vegas? I had a business in Michigan and moved an investment portfolio to Vegas in 2006. The fact that there’s no income tax in Nevada might have had something to do with it! But, in reality, I’m more of an operator type guy and I had an opportunity to buy into a small casino called the Golden Gate. We bought 50% of that in 2006. I ended up really liking Las Vegas 20 GAMINGAMERICA

– I loved Downtown – and was able to use that as a starting point. It kind of grew from there.

From there, how did you come to develop this relatively recent project, the Circa Resort & Casino? In 2006, that’s really when my licensing process began. I got licensed in March 2008. Then we were going through a bit of a recession in the country at that time, so some prices really

CIRCA RESORT & CASINO

orientated around renovating the property. But as 2015-2016 evolved, I had the chance to speak to other landowners on the city block – between Main Street and First Street, and between Fremont Street and Ogden – and we were able to acquire all those other properties. It was really one of those things when the stars aligned. Once we put this real estate assemblage together, that’s really when we knew, okay, we’re going to do a much bigger project than initially thought. We thought that city block was one of the most important in all of Las Vegas.

"I WOULD SAY DOWNTOWN IS REALLY STARTING TO TAKE OFF." came down. I had the opportunity to buy into a property in Downtown Las Vegas, right on Fremont Street, called Fitzgeralds. I purchased that in 2011. We renovated it, turning it into the D Las Vegas, a project which came out pretty well. My brother and I wanted to keep growing, and we had the opportunity to purchase some land and an old casino called the Las Vegas Club. That commenced in August of 2015. It was the first of about seven real estate transactions to get us the property on which Circa stands today.

How agile have you had to be in manipulating the property market in Las Vegas, to pull off the Circa development? I think, to be honest, we were just pretty damn lucky. When we first purchased the Las Vegas Club, our initial thoughts were

Do you think building Circa in that location has had the effect of revitalizing that area? I would say that what you see in Downtown Las Vegas is really starting to take off. When we bought Fitzgeralds in 2011, Downtown had project after project really help support both prior projects and future projects. So, I would say this has been about a great 10-year run downtown; and Circa certainly was a part of that. It’s pretty amazing to see all these new housing developments, all these apartments going up. You see investment in additional bars and restaurants, and new businesses moving downtown. It’s been pretty amazing over the last 10 years, seeing all this investment going into the neighborhood.

GAMINGAMERICA 21

CIRCA RESORT & CASINO

Is it true that Circa Casino has the largest sportsbook in the world?

Have you transferred your allegiance from Detroit teams to Las Vegas teams?

Yeah, that’s true. You know, the Fremont Street Experience is the second-most visited tourist attraction in America. Las Vegas as a whole has 150,000 hotel rooms, while Downtown Las Vegas only has 6,000. Yet Fremont Street has always been an attraction. When we designed Circa, we wanted to design an attraction within an attraction. Now, I’m a sports guy, and we wanted to create something special from the sports experience perspective, so part of the project of Circa was to design the world’s largest sportsbook. It’s three stories tall.

Fortunately I’m a sports fan. I like all sports. I’m always going to be a Detroit Tigers, a Detroit Lions fan, because that’s where I’m from; but I love the Las Vegas teams too, the Golden Knights and the Raiders.

From an operational standpoint, where do you see sports betting going in the coming years? What we’ve seen in the last two years has been exponential growth, as more and more states have legalized betting. I’ve always thought that would be a great thing for Las Vegas and the State of Nevada. It’s really awakening a lot of the overall public in the US to sports betting and how fun it can be. It’s good for teams, it’s good for owners, it’s good for media networks; and it’s a hell of a lot of fun for plenty of people who are now making their first sports bet. 22 GAMINGAMERICA

Do you find it’s important to have a presence on the floor in the operation of a casino? Well, I’ve always been fortunate that I love my businesses, so it’s not as though I want to run out at five o’clock. I get a bit of a benefit in that I work in an office throughout the day, but at night I get to go down to the casino floor. I get to hang around customers coming in and watch some games. It’s one of those things: everyone likes to see a maitre d', everyone likes to see the owner, whether you’re in the casino business or the restaurant business. There’s a something a little bit special with private ownership and entrepreneurialism. And I love meeting the crowd. That’s, frankly, where I get a lot of my best feedback from: when people belly up to the bar, get some drinks and we start talking about what’s been nice on their trip.

CIRCA RESORT & CASINO

"I’M A SPORTS GUY, AND WE WANTED TO CREATE SOMETHING SPECIAL FROM THE SPORTS PERSPECTIVE." On to future trends, do you see the presentation of casinos changing in the future? It’s always evolving. Right from the get-go, I wanted a multi-level casino. We spent a number of years trying to develop processes for getting people to the second floor. I would say 15 years ago it would have been taboo to design casinos with two stories. We really took a different approach. I love multi-level casinos because it can give you the ability to have different energy. And some casinos in more urban areas – like Detroit, for example – are multi-level. I was intrigued by that. It allows for a higher capacity of players. Let’s say, too, that you’re in a regional casino with very inexpensive land costs. Well, that might be a different ball game than if you’re in a city or a downtown area where land is at a premium and building up is the way to expand your property. Casino design is always going to keep changing, it’s always

24 GAMINGAMERICA

going to keep evolving. The important thing is to have a design that really works for the geographic environment and jurisdiction you’re in. And you’ve got to know who your customers are going to be, and ensure they like your design.

Do you have your eyes on building something on the Strip? Right now we’re pretty happy with what we have with Circa. We’ve had the hotel open for less than a year now and, after a five-and-a-half-year construction project, I’m pretty excited to do what I love doing: operating. I’m more orientated around that side of things.

What is your five-year plan? We have a couple of projects here for 2022. One thing worth noting for Circa is that we designed the property with seven empty floors. The reason we did this is because I wanted to get a good idea of how the property would run. It is important to get a real sense on the final build after the property has been up for a couple of years, because we really wouldn’t have known what we needed more of: more premium rooms, two-bedroom suites, three-bedroom suites, etc. Keeping some floors open, to address where the biggest need is, is something that makes sense to me. So we’ve got a couple of phased elements to Circa. Next year we’re going to build out our ballroom and meeting space. That‘s a pretty big project for 2022. Then, if you look at 2023 and beyond, we’re going to make a call on how to utilize these empty floors within the structure.

OLIVER LOVAT

THE OLD NEW CASINO Regular Gaming America contributor Oliver Lovat discusses innovating the “old new casino” for the future. There are few deeper thinkers in the world of casino and hospitality innovation than Dr Robert Rippee, the Executive Director of UNLV’s Black Fire Innovation Hub. Rippee has a stellar career in the hospitality industry behind him – and a brighter legacy yet to be forged. His Ph.D dissertation, “A Nomological Network Analysis of Innovation in Hospitality Education and Industry” was published at the height of the Covid-19 pandemic. It is perhaps the most comprehensive study into the methodology of hospitality innovation, challenging the industry to chart a new path. Rippee concludes his work: “The Covid-19 pandemic has been devastating but from the research on its effects also comes the opportunity for innovative and entrepreneurial minds to find new solutions. New solutions that may help the industry recover, restoring millions of hospitality workers’ livelihood, and return the pleasure and enjoyment of tourism. There has never been a more critical moment for entrepreneurship and innovation in hospitality.” His observations are highly prescient, with perhaps the greatest advances in the casino experience within sight.

Casinos: An analogue legacy in the digital age The land-based casino sector is perhaps the industry least embracing of technology and innovation over the past 50 years. Some consider this is what makes the sector so engaging, as customers receive an analogue experience in the digital age. However, we have witnessed that the small innovations made have had a positive impact on customers and businesses alike. The first, and perhaps the most compelling, was the introduction of a stool or chair adjacent to a slot machine. This novel introduction increased time on device and led to a sharp increase in slot revenues; making them as, or indeed more, important to the casino floor than table games. The next great innovation was digitizing the casino floor. This process enabled the advent of digital slots, multi-denominational wagers and a scientific approach to 26 GAMINGAMERICA

management of casino operations. The technology also saw linking of slots, creating the possibility of truly life-changing jackpot wins for a relatively small wager, again making the experience more enticing and driving revenue. This change allowed for Ticket-In/Ticket-Out (TITO) systems and hastened the elimination of clunky mechanical slot devices; which in turn reduced labor costs, mechanical issues, coin use and led to widespread adoption of players cards, and customer tracking technologies. This increased data collection of both device and player evolved, enabling detailed insights to customer value and focused loyalty and marketing efforts, which have been key to the professionalizing of operations and management within the wider industry. Whether due to legislative constraints, industry complacency, market consolidation or several other issues identified by Rippee, the past 20 years have seen a stasis with respect to large-scale innovation in US casinos.

Old ideas, new practices In a post-Covid world, and as we firmly embrace the full digital splendor of the current age, it seems that land-based casinos are about to take the leap and embrace technology, with the move to go cashless under consideration and arguably well under way. Conceptually, the cashless casino is not new. For generations, chips or credits, interchangeable for cash, have been the currency of choice, but what is new is the sophistication of the technology and increasing willingness of customers to embrace these new technologies. However, the road from vision to reality is fraught with potential challenges. Some of the biggest names in business that the average customer has never heard of, Everi Holdings (once Global Cash Access), Sightline Payments and Fortune 500 company, Global Payments (Gaming Solutions), which is the leader in the space, have recognized gaming as a sector for major innovation. These companies traditionally provided customers with the

OLIVER LOVAT

payment methods to retrieve currency from their bank accounts to product vendors, including casinos. Their platforms currently include engagement with customers via terminals offering ATM-style services, larger transfer services via casino cage or other financial functions. However, as we have observed in other sectors, customers are moving towards cashless transactions, making payments directly from debit card “touch” services or via digital wallets on cell phones. As Global Payments sets out, there are clear benefits to this. From the customer perspective, costs are reduced as there are fewer interactions to bring cash in a bank account to use. It also allows the customer to accurately track their gaming spend, which is harder when using hard cash inserted into slot machines or at the tables, unless a marker is used. From the casino operator view, easier transactions increase customer loyalty (which is the driver of competitive advantage), costs are reduced and it is easier to monitor sources of finance from a fraud or money laundering perspective. In addition to the “true” cashless enablers are the gaming technology companies that have enabled cashless modularity to their devices. IGT has developed “The Resort Wallet,” Konami and Sightline have partnered on Play+ and Scientific Games has a Unified Wallet, each with the aim of being the winner in the digital wallet war. For sure, due attention must be given to these manufacturing giants, with their prized patents, staggering market values and dominant market positions; but equal measure must be given to a much smaller company, Acres Gaming, led by casino pioneer John Acres. Many of the real innovations made in the past 30 years – including several of those outlined above – originated in the head of Acres, were implemented by his hand, and then acquired and exploited by the larger companies. Acres is a technologist, but that is not what drives his desire to innovate; he is motivated by improving the customer experience in the casino environment. Knowing that he cannot compete with the other providers’ market position, Acres’ Foundation

is an enduringly flexible, open solution. Yet moreover, in addition to functionality, it provides Acres’ staple of customer engagement, insight and increases customer involvement via a mobile device. All these systems are at various points of development and implementation; and several cash enablers and games suppliers have both informal and informal partnerships in place, where fintech and casino-tech are working together to accelerate efficacy. As we know, the regulatory environment in the US does not move in lockstep. So unlike previous casino innovations, where Nevada led the way, tribal, US regional and even international jurisdictions are the testing ground for the future Las Vegas casino floor. The race is on for widespread adoption on the casino floor, but both the route and the finish line are continually shifting.

Old practices, new ideas We associate gaming currency with the clay chips of blackjack and poker players, but these are insignificant to the millions of console gamers’ transactions, where accumulated points (and cash) is used to acquire, skins, loot boxes and other features. Or behind the cell phone glass, where both cash-denominated credits and non-refundable points are used to spin digital slot machines and similar games. Across the world, it is evident that the good old greenback is losing traction as the currency of gamers. The earliest convergence between physical and digital began a decade ago, with the MyVegas Social Casino, where players could redeem their accumulated points within four-wall casino buildings, whether on food and beverage, or even free rooms. Casino loyalty programs have long implemented points that are acquired and redeemable in cross-functional areas. From these seeds, betting and gaming apps are entering a new age, with the rapid ascent of the multi-billion-dollar sports-betting business, currently dominating US commercial breaks, and promising to usher a change in the perceptions of casinos in general and Las Vegas in particular. Even one of the gaming industry’s biggest critics, Disney, has made advances in the sector, promoting sports betting on its ESPN network, and holding a (passive) stake in DraftKings. Moreover, looking outside the gaming universe, non-traditional digital currencies are established alternatives to legacy currency. In Las Vegas, there has been some sporadic adoption, with several resorts, notably Derek Stevens' properties in DTLV and the new Strip addition, Resorts World, allowing Bitcoin for payment, but not gaming. Matthew Dickson, CEO of BitBoss, is leading the movement to align blockchain technology with the cashless casino experience. Dickson, a gaming entrepreneur, believes that rather than taking small, incremental steps, casinos should fully embrace the available technology and generational societal trends holistically; aligning all gaming and hospitality platforms GAMINGAMERICA 27

OLIVER LOVAT

into a single digital currency, where all activities, from digital sports betting, to casino transactions, to hotel reservations can be made via a single digital wallet. This would eliminate the need to even engage with the cash element – and the fees levied by the cash-based payment companies. Unlike some digital currencies which have changeable exchange rates, Dickson advocates for a fixed unit, so all payments are totally transparent; and like cash, this technology can link into existing payment, tracking and bonusing systems. There is concern from regulators, as these technological and supplier changes see the management of the customer’s spend, sources of funds and propensity to undertake irresponsible practices, transferring from the casino’s responsibility (and accountability) to third parties. True, many of the digital wallets have built-in personal limits and controls; but from a regulatory perspective, where the actual control and monitoring structures sit – whether the casino, software providers, cash managers or indeed even the banks where customer cash is held – is still ill-defined. Investigating the effects on customer behavior and developing the regulatory framework is imperative. The UNLV’s International Gaming Institute (supported participating parties include UK online gaming giant, Entain, Sightline Payments and Global Payments) has recently initiated a deep study into responsible gaming and cashless methodologies. The industry awaits these findings with anticipation.

The implementors’ dilemma When Ticket-In/Ticket-Out was rolled out, the owner of the technology was MGM Resorts. It called in the leading manufacturers of the day and instructed them on the expected protocols. However, in this age of high-reward innovation, the key players are not so collegiate in their approach, with patents prized and protected. As illustrated above, there is a clear opportunity to innovate; the technology is present, the desire is evident, but the roadmap to implementation is not apparent. It is here that we refer again to Rippee’s timely contribution; (there is) “A significant deficiency in any theoretical foundation for hospitality innovation-related research, due to the absence of an interdisciplinary research foundation, including seminal works.” In tribal and regional markets, where there are few operators and a less competitive environment, implementation is relatively straightforward, with few external checks and consequential restrictions. Indeed, Rippee himself proposes a strategy for large-scale implementation in his dissertation. And yet, in a crowded and competitive market such as Las Vegas or Atlantic City, the risks of choosing the wrong strategy or supplier could have a detrimental impact; unlike any previous innovations. From an operator perspective there are both upsides and downsides in locking in customer spend; capturing a greater share of customer wallet is a stated strategy, and a driver of 28 GAMINGAMERICA

OLIVER LOVAT

multiple resort ownership. However, if a standalone or the consolidated resort owners apply different, non-compliant, technologies, the competitive environment will be altered to the detriment of non-lodging (or non-multiple wallet-holding) guests. Or to put it another way, without standardization, the long-held behavior of customers moving from one property to another would be a thing of the past. Nobody wants to be selling Betamax video tapes if the means of watching is VHS. Perhaps the answer sits in the successful implementation of past changes, namely cooperation and standardization. Together, the major resorts companies should advance as one. This approach would no doubt assume that the gaming tech companies would have to accept sharing or relinquishing of their patent rights. Like the introduction of the Euro in Europe, a gradual switching takes place, with conforming digital wallets replacing cash over a defined period, with transferability between all associated members. Understanding the technological future of casinos is realizing the thesis set out in the analogue behaviors of the past. We must understand that our strategic assets are our customers, and successful technological change requires a concerted effort to innovate to meet their needs. The answers to the difficult questions related to the complex implementation are already evident, albeit in a less established manner, or until Dr Rippee’s contribution, a less codified form. Theoretically, the new challenge is actually an old problem – it is just how to apply the technological innovation that is the question. The answer to innovating the new is also in the old. It just requires deep thought, careful consideration and experienced hands, otherwise the entire customer experience will be disrupted, and not in a positive way. Oliver Lovat leads the Denstone Group, which offers strategic consultancy on customer-facing, asset-backed investments, including casinos. He is visiting faculty at Bayes Business School, part of City University of London.

ENTAIN

SEEKING SUSTAINABILITY Gaming America sat down with Entain’s Chief Governance Officer, Robert Hoskin, to discuss a sustainable future, ARC and reconciling profit with safer gambling.

Early in November, industry giant Entain gathered some of its biggest names to discuss the operator's new platform, Advanced Responsibility and Care, otherwise known as ARC. The event, aptly named Entain Sustain, featured high-profile speakers, such as the company’s CEO Jette Nygaard-Andersen and Virginia McDowell. Throughout the day, the operator highlighted some of its commitments to safer gambling and sustainability; from EnTrain, an initiative designed to educate and uplift those from underprivileged backgrounds, to the Entain forest, an effort to plant over one million trees to fight climate change. The star of the show, however, was ARC, a responsible gaming program with the aim of reducing problem gambling across all of Entain’s platforms. Built on seven cornerstones, including educating key stakeholders, empowering customers and promoting responsible attitudes, ARC is set to launch in the UK soon; with plans for an international launch in the works. As the day came to a close, we sat down with one of the key thinkers behind ARC, Entain CGO Robert Hoskin. Here’s what he had to say.

ARC aims to provide safeguards for customers. Can you explain the technical process that goes into developing a platform like that? "It starts with the research phase, where we look at it from three levels. There’s the identification phase, which 30 GAMINGAMERICA

is really the hardest bit; this is where we use Harvard’s division of addiction, Professor Mark Griffiths and Epic Risk Management to feed in that research. We are building something that is based on the best research and understanding of the issues, the problems and the red flags, so then we can build models for markers of harm, or markers of protection as we call them now. These models have become much more complicated and it is a much wider spectrum of markers than before.” These models, as referred to by Hoskin, are fed into the operator’s data-led analytical system, which is then able to highlight signs of problem gambling and respond accordingly. “On the second level,” Hoskin continues, “we create a portfolio of safer gambling tools so it is easy for players to set limits and self-manage their own experience. If they are self-managing, doing it themselves, you already tick that box in that it is less invasive than being told what you can and can’t do. “Then, to the extent that some of the players don’t use our tools – and you have to remember this is a technology that is dealing with every single customer on a bespoke basis – you can sensitively and proactively step in through our customer service operators; they are trained by Epic in safer gambling. We have seen wonderful results from ARC so far in the testing process. We have tested it with our smaller brands and will have soon rolled it out across all of our UK operations by the

ENTAIN

different approaches to regulation. I have been in front of US regulators, as we are licensed in 16 states now, and every single one of them has asked me about responsible gambling. It’s on their radar even though the industry is at a much earlier stage than it is in the UK, for example. However, I would expect regulators to focus more and more on responsible gambling and we, as in Entain, are running a number of projects with our US partners; focused on educating stakeholders and not just regulators but the sports authorities and colleges. “

How will ARC enter the US, via BetMGM perhaps? “BetMGM is a joint venture, MGM Resorts has been a very successful land-based operator for many years and we should not underestimate the land-based experience and their focus on responsible gambling. For us, it’s a case of developing ARC and we know it will have to be tailored for different countries. In due course, I expect we will sit down with BetMGM and MGM Resorts to show them what ARC does, and then we can take it from there." As the day came to a close, one thing was certainly clear: Entain wanted to project an image of care, responsibility and sustainability to its customers, shareholders and the gaming industry at large. However, despite the panels, statistics and speakers, how does a company reconcile sustainability and responsibility with the need for growth and profit? We posited that question to Hoskin. end of the year. “Overall, it's multi-layered, we are very fortunate that we have the best technology stack in the industry, which means ARC is built on very solid foundations. This is going to be a very important chapter, not just for Entain but safer gambling in the wider gaming industry.”

How important is the lived experience, or human touch, a company like Epic brings? “You heard Paul on the panel,” the CGO said in reference to Paul Buck, Founder and CEO of Epic Risk Management, who has struggled with problem gambling himself. “When you hear it from someone who has lived and breathed the issues, the problems (he has played on over 90 sites) he knows what doesn’t work, as well as where operators have potentially not helped matters. When you hear it firsthand it is powerful, not just for that audience but he and his colleagues will speak to people who work with customers; and it brings massive value to hear from someone who has had issues with the industry themselves. He has lived and breathed it.”

In your presentation you said ARC is a challenge to regulators. How will US governments approach this challenge? “With the United States it is not just the case of ‘the US’, it’s multiple, multiple regions, and different states have

How does a company reconcile that want for responsibility and sustainability with the need for profit? “I think it is about a long-term commitment to the customer. We have seen today that operators in the past have been too focused on short-term profitability; if we can get ARC right, which I’m confident we will, we are building additional goodwill with the players. We will be protecting them, in the short term we might not make as much from them as we used to, but longer term we will have longer lifespans and longer relationships with the customer. So I think ultimately we want long-term growth and a long-term relationship with our customers.” As the interview came to a close, Entain’s CGO concluded: “What’s great about this conference, not only is it nice to see everyone, but we have really made ESG into something tangible. In the past, not just in this sector but in the governance world, whether it's CSR or ESG, people dealt with particular matters but it did not always feel that tangible. With today and our social impact report people can see, really clearly, what we are doing and how it's joined up to our sustainability charter. It supports that, and as I mentioned on my panel I hope we do another next year, so people can see how we have developed and perhaps focus on more international matters.” GAMINGAMERICA 31

888 HOLDINGS

EUROPEAN CAPITAL, AMERICAN GROWTH Yaniv Sherman, long-term executive at 888 Holdings, speaks to Gaming America about the tendency for American companies to look overseas for technology and capital, as well as the fast-maturing nature of the gaming sector. What do you make of this trend where US companies are buying UK companies? When you talk about American companies looking to acquire UK operators, it’s essentially that American companies are looking to acquire a few things that tend to be concentrated across the pond. Mainly, that is because the UK still represents the single largest regulated online market in the world. Also, from a longevity perspective, it’s been around for quite some time. It represents technologies and operations; it represents P&L, with an emphasis on the 'P' rather than the 'L.' I think it also represents the race to scale (one of our main considerations). From an American company’s perspective, when you look at the success of BetMGM in the market – something we’re trying to replicate with SI SportsBook – one sees coupling proven technology with US flavor, a US-facing brand and so forth. There’s also a pending shift in the investors’ mindset in 32 GAMINGAMERICA

that they understand scale but they are also more concerned with the path to profitability. I think business plans that are forever loss-making are not well-received at this point. No one is presenting something like that. I think there is a prevailing notion of kicking the can down the road; we can then close the throttle on market and enjoy our scale. But I think you have to draw a much clearer line between how you are going to achieve that. Buying a Europe-facing or UK-facing company helps you in that regard.

What do operators need to know about the US market to become more appealing? First and foremost, they need to acknowledge the level of commitment, involvement and investment into the market. When I stood in front of the board and outlined our strategy,

888 HOLDINGS

our plans and our model, I had to make sure everyone understood that we were in here for the long haul. We’ve been operating in the market since 2013, but since 2018 the rules of the games have changed considerably. You’ve seen your new players venture in. Now you see non-gaming operators, like media companies and consumer-facing retail businesses. And a lot more capital is applied. Everything in the market is naturally driven by cheap capital, so you need to make sure everyone understands the level of commitment and focus.

What’s your overall outlook for the industry in the next three to five years? The industry is interesting. I’ve just celebrated my 14th year with the company, and every time I look back I get dizzy. It’s not like your traditional IT sector. Its development has been fast and furious like a lot of growth areas. I think only ecommerce moved faster.

"THIS IS WHERE ONLINE HITS ITS STRIDE. YOU’LL SEE MORE CAPITAL AND INVESTMENT COMING THROUGH AND IT WILL BECOME A BLUE-CHIP INDUSTRY, AND AN INVESTABLE SECTOR." I think the direction of travel is regulation. You see more and more markets regulating, and not just in the US. Ontario is coming across, and I expect other Canadian provinces to follow suit. You’re talking about Latin America, as well. In three to five years, I think the regulatory footprint will be bigger, not just in the US but elsewhere. I think Europe right now, for all practical purposes, is spoken for. America will follow suit. Once Brazil and Argentina finalize their regulation, you’ll have the Latin American anchors on top of Colombia and Mexico.

How about online gaming? This is where online and digital gaming hit their stride. You’ll see more capital and investment coming through and it will become a blue-chip industry, an investable sector. It already is, but right now it has the hype and buzz associated with high-speed growth. I think you’ll you see stabilization of some of the states around this medium. You’ll see consolidation. There will be fewer players left on the playing field. I think you already see that today. So, in three years (let’s call it),

YANIV SHERMAN

globally you are looking at eight to 10 uber operators – maybe even fewer – that are able to leverage their respective market strength. In each market, certain operators will rule, but they will all be in all of the markets. At least that will be true for ourselves.

What are some other industry-defining trends? Some of these companies will venture outside of classic gaming. You already see that today, when these gaming companies label themselves entertainment companies. Our joint venture around ABG with Sports Illustrated is a good example of the beginning of such a process. There will be the connection of sports betting – and gaming generally – into the entertainment funnel. You will come in to consume one thing and then will end up consuming a gaming or sports betting product. It remains to be seen how diversified it will become. If you move too fast, entertainment is a whole other sector. I thought we had an aggressive sector, but now being close to some of those in entertainment, it’s a tough ocean to swim in. Those of us who have scale and proficiency will do well. GAMINGAMERICA 33

THE CANADIAN GAMING ASSOCIATION

THE KING IN THE NORTH

Gaming America recently sat down with Paul Burns, President & CEO of the Canadian Gaming Association, to discuss the history of sports betting in the country, and the bright future ahead for the nascent industry. Firstly, would you be able to tell our readers about your career in gaming to date, and the role you played in establishing the Canadian Gaming Association? My background is in politics. I previously worked for political leaders at the federal-provincial level and one of the last political files I ended up managing in Ontario was for gaming. When the region, back in the late '90s, was expanding gaming offerings through casinos, slots and race tracks, I got to work on a lot of those files; and that ended up leading me to work for a company that wanted to build casinos in the region at that time. That’s how I got started in the gaming business and I have been in and out of it for a while. In 2006, my former colleague was approached to form a national trade association for the gaming industry in Canada. As many people know, gaming in Canada at this time was largely in the purview of the provisional government, with government agencies and lottery corporations overseeing the sector. In the early 2000s, there was a large emergence of private-sector participation in the industry and this has been growing ever since. Thus, through the establishment of the Canadian Gaming Association, we have been able to create a voice for gaming 34 GAMINGAMERICA

in Canada and today we have 55 member companies. Obviously, the last two years have been filled with many challenges but also a lot of opportunities, especially with the law that saw single-event sports betting legalized throughout the country, and the government announcement that Ontario will become an opened licensing market for online gaming. Overall, we came out of the backend of a pretty nasty two years with exciting times ahead for the Canadian gaming industry.

The last year has been a period of tremendous growth for sports betting in Canada, following Bill C-218; can you explain the process it took to finally get single sports betting regulated throughout the country? The overarching laws for gaming in Canada reside in the Criminal Code of Canada; but since 1985, the power of gaming was essentially devolved to the provincial governments. From here the Federal Government’s involvement sort of stopped, and so to get interest in amending in such a specific event – remember we had sports betting in Canada for decades, it just had to be a parlay wager – we had our first meeting in 2010.

THE CANADIAN GAMING ASSOCIATION

Our first bill actually passed the House of Commons unanimously; it went to our Senate and they really were not having any of it. There was modest opposition from sports leagues but mostly just a lack of information and they refused to deal with it, despite provincial governments, labor and communities’ support. We tried to push it through but they did not want to deal with it. The third time, however, was a success. The timing was right, professional sports leagues had joined the cause and there was literally no opposition.

Do you think the lack of opposition the third time around was partly due to the huge growth demonstrated in the US? Yes, it really showed the inevitability to the Members of Parliament and the senators could see it was coming. The country has a large grey market; Canadians have been betting for the majority of a decade, in excess of $4bn in handle. This also drove home the fact. The timing of all of these things coming together was certainly fortuitous and it was an interesting coalition with the amateur athletics community.

With that, and the unprecedented growth seen by the sports betting market in the US, where do you see Canadian sports betting going in the next few years? Because of Ontario (which is the fifth-largest jurisdiction in North America now) being an open market, we are going to see a wide variety of offerings for the people of the province. Bringing gaming into the regulated sphere will really unlock the market. From a sports betting point of view, partnerships between sports teams and sportsbooks are important. Even the Toronto Star, which is one of Canada’s largest daily newspapers, is going to be launching its own sportsbook; so it is clear we will see a lot of variety and a lot of opportunities for customers. One of the things we have talked about a lot with the Government here is tapping into the innovation sector, the small emerging start-up companies; Ontario proves a unique opportunity for them because a license is available here where it is not in many other regions. Canada has punched above its weight for some time, a lot of companies saw their genesis here but because of the previous lack of licensing they have had to leave the market. We are hoping now we can get generation companies that grow up here and stay in Canada.

Your career has often focused on the importance of responsible gambling. How does the industry, growing as fast as it is, continue to balance growth with responsibility? This has been part of how the Canadian gaming market emerged. A lot of the discussions that are happening in the UK right now, we had a decade ago. And in terms of building in player tools and responsible play into awareness programs,

PAUL BURNS

advertising standards, education, access to self-exclusion, we will see these things continue in our market. The amazing thing is – we have had discussions with some of our members new and old about this – companies have really been stepping up and understanding that they want to lessen the impact they are having on their customers, by ensuring they provide player protection tools. Universal self-exclusion will also be a feature of the marketplace; if you are excluded from a casino in a community, you will be excluded from online offerings. So there are a lot of provisions people are happy to sign on to. A lot of the educational material is done by provisional governments but now the private sector is looking to help. Moreover, every staff member in every casino in the country is trained in responsible gambling. Operators have welcomed this approach as they want healthy customers.

The Canadian Gaming Association has recently elected four new board members. What do you feel these new voices can bring to the organization? A lot of our growth has come from sports betting payments and online technology: that’s where these new members have come from, each bringing a wealth of experience from their respective careers and companies they represent. The CGA board took the opportunity to, as we continually do, expand the board to reflect our membership growth. It was a logical choice, then, that all sectors of the industry that are represented in our membership are also reflected on our board. We are grateful for those that stepped up: they have a great deal of knowledge to offer and are eager to do so, so we are thrilled. GAMINGAMERICA 35

CASHLESS

CHANGE IS IN THE AIR Cash will be here for a while, but is no longer king of the casino, with an even greater move to cashless gaming predicted for 2022. The idea of cashless gaming in casinos has been discussed for years – and 2022 might see a significant move forward. According to four gaming industry insiders who spoke with Gaming America, the change to cashless is not only coming soon, in many ways the “future” is already here. They said progress would be even more swift if not for regulatory hurdles that need to be updated, to reflect a new generation that not only does not carry cash, its members don’t even carry a wallet. With all that said, there was a general agreement cash will continue to be offered as an option for those who prefer to put a bill into a slot machine. Tiffany Sadler, Global Marketing Manager, Gaming and Amusement for Suzo Happ, said the technology to load money onto a machine via a cashless or contactless option has existed “for a while now.” “Adoption has just been slower – although it has definitely sped up since the beginning of the pandemic,” Sadler assessed. “Where we are likely to see a lot of innovation now is in integrating these technologies with property apps in to gather more customer data and on the payout side.” Tracey Chernay, SVP Global Casino, Gaming and Lottery for TransAct Technologies, noted casino operators are interested 36 GAMINGAMERICA

in any technology that will help improve player experience to keep them coming back, staying longer and spending more entertainment dollars at their casino. "Improvement in player experience means different things to different players, so it is not a one-size-fits-all technology solution," Chernay emphasized.

"IN MANY WAYS THE 'FUTURE' IS ALREADY HERE." She continued: “While a very small number of players might still long nostalgically for the authentic ‘cha-ching’ of change falling into the hopper, most players have embraced ticket-in, ticket-out (TITO) as a convenient way to begin playing

CASHLESS

quickly, to easily move between games, and to cash out when they are ready to head home." Chad Hoehne, President and Founder of CasinoTrac, agreed. When asked in what ways the gaming industry will move toward cashless during the year ahead, he replied: “I think it is already there.” Hoehne noted CasinoTrac, along with all of the CMS providers, offers a “cashless” and “mobile-app enabled” solution and is joining forces with the industry’s financial services providers on moving cashless forward. “Whether it’s called a ‘wallet’ or some other term, provisions are there to allow the guest to move funds from external funding sources all the way to games and back,” Hoehne said. “It is the regulators and casinos that will determine the pace and scope of adoption of this technology.” Mike Kaplan, Chief Revenue Officer, PayNearMe, predicted the lines between the online and offline worlds will continue to become more blurred in 2022. He said land-based operators will

look to leverage their database and loyalty programs to drive acquisition of players online. “A major part of that relates to how players view the balance they have online, and their ability to use that balance in a brick-and-mortar casino,” Kaplan said, adding: “Cashless will play an important role in bridging the online and offline worlds.”

CH-CH-CH-CH-CHANGES CasinoTrac’s Hoehne said regulation and adoption of cashless technology will be the top trend to watch for the year ahead, but he expects casino floor automation and staff-reducing technologies will be a close second. Sadler of Suzo Happ believes the gaming industry will display a great deal of creativity with how player payouts will be handled. She noted coins are becoming rare as players offer options in which change can be donated to various charitable organizations in lieu of payout, can be printed on an additional GAMINGAMERICA 37

CASHLESS

voucher or added to an app account for future use. “This flexibility and abundance of choices is exactly what customers want and where we are likely to see the most growth in the next year or so,” Sadler said. Kaplan of PayNearMe described cashless as a “fast-moving market,” and said he expects “a few areas” will see changes, starting with regulatory changes that embrace available technology. In addition, as more states go online in sports betting, he believes operators will look to catch up to what they are doing on the retail side to drive adoption. TransAct’s Chernay said cashless technology takes the benefits of TITO and adds the element of access to the player’s funds. “Some players will be early adopters, signing up for cashless wallets, but most will be quite happy to continue to use cash as their access to funds,” Chernay said. A benefit of cashless is that it does not disrupt most players

“This prevents customers from having to wait in cashier lines, reduces touch points and interactions, and expedites the transaction for both the player and the property,” Sadler said, calling it a “win-win situation” that eventually will reduce labor and overhead costs, and keeps players at games for longer periods as they do not need to leave their seat to reload. “If they haven’t already, these contactless/cashless options definitely will be on the casino floors in some format – whether in terminals or perhaps, depending on legislation, fully integrated at the individual game level,” Sadler predicted. "So the infrastructure will still need to support it, albeit perhaps not as extensively as it is supported now,” she explained. “This is a transition that will likely happen over multiple years, not something we expect to see immediately, especially as it is expensive for casinos, and the past year and a half has hit the industry in an unprecedented way. As recovery continues, we will see more of

“WE SEE THIS AS AN EVOLUTIONARY CHANGE IN GAMING RATHER THAN A REVOLUTIONARY SEA CHANGE. THERE ARE MANY CASHLESS SOLUTIONS THAT HAVE BEEN INTRODUCED TO THE MARKET.” – TRACEY CHERNAY who are used to using TITO, Chernay continued, meaning the cashless wallet technology will be seen as “simply incremental” for those who are more technologically savvy. “We see this as an evolutionary change in the gaming industry rather than a revolutionary sea change,” Chernay said. “There are a great many cashless solutions that have been introduced to the market. I think there will be consolidation to a smaller number of the cashless solutions providers.”

NEW LOOK FOR CASINO FLOORS? Gaming America asked executives to describe what they expect will be different and what will be the same for cash on the casino floor by December 2022. Kaplan said every operator should have a cashless strategy in place that matches the online experience from a payments perspective – and not limited to cards. “This means offering the alternative payment options and digital wallets the next generation of players expects to be able to use, such as PayPal, Venmo and Apple Pay,” he said. Sadler pointed to a number of properties that have switched to Bluetooth-enabled card readers so players can connect to machines directly from their phones via property apps. 38 GAMINGAMERICA

these shifts occur naturally, but there is no immediate rush.” Hoehne said the player card will be replaced by virtual card methodologies in casinos by the end of 2022. “Also, if cashless is allowed broadly, we will see the first casino floors with no bill validators/drop boxes,” Hoehne said. “In my opinion, most casinos will still be using cash in the same way as today, even if they begin to offer cashless and virtual card options to their guests.” Chernay said she is watching the move toward electronic table games (ETG). With Covid as a backdrop, she noted casinos are finding it difficult to hire enough staff for manned table games, and there is more player acceptance of the ETGs. “ETGs have already incorporated familiar TITO solutions that allow players to easily access and move between the electronic tables. Again, I see cashless as incremental to this trend,” Chernay said. “But there are many reasons why some players prefer the use of cash and casinos want to appeal to all types of players. I don’t see the use of cash going away anytime soon; for either the guest who walks by the slots and puts $20 into a machine, the casual player who comes into the casino with their entertainment budget of $100 in hand, or even the high-value player that prefers not to be rated for whatever reason.”

HARD ROCK HOTEL & CASINO

HIGH FLYERS Gaming America examines the rising trend of charter airline services set up by operators in the wake of the Covid-19 pandemic. We speak with Joe Lupo, President of Hard Rock Hotel & Casino Atlantic City, on their overall role in a company’s offering, how they can benefit the land-based industry and the environmental impact of aviation. Brick-and-mortar properties, for so long the backbone and central pillar of the gaming industry, have faced innumerous challenges of late. Not least the closing of their own venues, but also the shutting of borders, preventing travel to some of the most esteemed and glamorous resorts that gaming has to offer. Land-based casinos and resorts have bounced back hugely since – but how can they keep it up? Well, some operators think they have an answer, one they hope could bring new swathes of visitors to the blackjack and roulette tables that have supported the gaming industry for so long. Chartered air travel, flying to a resort, is not something that seems particularly unique. We fly regularly, with 50% of Americans taking one or more vacations a year, according to a recent study conducted by The Points Guy. It would seem gaming operators are tuned in to this want to travel following almost two years of lockdown. With that in mind, recent months have seen a number of the industry's most prominent operators agree to deals that will see their patrons flown to casinos in high-end and relatively exclusive charter services. From Hard Rock to MGM Resorts International and Ceasars Entertainment, this is a trend that is gaining traction throughout the US land-based market. The adoption of these services raises a series of questions: is this an attempt to add convenience to the land-based casino in response to the ever-growing popularity of mobile gaming, or an attempt to brand the casino experience as an exclusive high-class vacation for travel-hungry Americans? What of the impact of regularly flying crowds of people large distances? Can operators commit to sustainability when they are willingly polluting the environment? To find out some answers we spoke to Joe Lupo, President of Hard Rock Casino & Hotel Atlantic City, about the operator's Hard Rock Air service, while also studying the other offerings made available to Americans. 40 GAMINGAMERICA

How important is Hard Rock Air to the Hard Rock brand? Hard Rock Air facilitates and creates an accessible means of travel for customers who are at least a four-hour drive away. The program turns their trip into an easy, 45-minute luxury excursion to Hard Rock Hotel & Casino Atlantic City, offering an unforgettable travel experience from departure to arrival.

Travel was halted for an extended period of time over the last 18 months. How do you think offerings such as Hard Rock Air can help boost the number of visitors to Hard Rock resorts post-pandemic? While Hard Rock Atlantic City has seen tremendous market growth since opening three years ago, it’s important

we speak to a wide range of customers in a market that overall has seen declines over the past year and a half. Hard Rock Air has and will continue to boost visitor frequency at our resort. The ease of travel utilizing fixed-base operator private jet terminals, combined with a shorter trip time, allows us to speak to a wider range of customers, which is critical to success in this market.

As mobile gaming continues to grow throughout the US, some might say the land-based segment is being forced to adapt. Is a tailored travel service that offers a sense of exclusivity the best way to sustain the land-based industry? I respectfully disagree. Online gaming enables us to speak to more customers, providing the opportunity to offer them a

HARD ROCK HOTEL & CASINO

premium and unique experience inclusive of live entertainment, fine dining, spa visits, and time on the beach; all of which are experiences that online gaming will simply never be able to provide or replicate.

Lastly, what would you say about the environmental impact of flying people across the country year-round? Hard Rock Air holds a very exclusive amount of customers, only 30 per plane. This allows for a very intimate and customized experience that our customer base truly enjoys. With that said, I’m proud of all the hard work and initiatives that Hard Rock International and its properties enact to save the planet, which has been a core motto long before environmental issues were widely supported. Hard Rock International’s ongoing support of various environmental

organizations such as Sustainable Biodiesel Alliance, National Arbor Day Foundation, Farm Aid, Concert for the Oceans Foundation, Surfrider Foundation USA and SurfAid International displays the company’s commitment toward a cleaner, eco-friendly world. Hard Rock is by no means the only operator to introduce a chartered airline service in recent months, but Lupo’s comments reflect the wider tone of other chartered services. November saw Caesars Entertainment sign a five-year agreement with Sun Country Airlines to fly patrons to several Caesars-operated properties across the country, with both parties citing convenience and reliability as imperative. MGM Resorts International also announced the beginning of charter flights to its Borgata Atlantic City Casino in June, allowing residents of up to 75 cities to fly into the famed New Jersey property, offering travel via a 173-seat 737-800 airplane. In both cases, the operators’ most valued customers, Seven Star Caesars users and MGM M Life members, fly for free, once again emphasizing the notion that these services act to create a sense of exclusivity.

Exclusivity, in fact, is the word stamped over every charter announcement. Operators clearly want a trip to a land-based property to be seen as an event, not simply logging into a mobile app. Hard Rock Air is described by the company as an “unforgettable travel experience from departure to arrival.“ However, as reflected in Lupo’s comments, the service should not work to replace the convenience of mobile, perhaps because it never can. But, rather, it should work in tandem with an operator’s other offerings to create a sense of exclusivity and luxury for companies’ most valued customers. This exclusivity comes at a cost, however, with the global aviation industry accounting for around 12% of all emissions produced by humans and having an undoubtedly large impact on climate change. Of course, the weight of responsibility does not fall solely on these operators: the emissions produced by these charter services will be negligible. Yet, if companies like Hard Rock want all the work they put into making their business sustainable to have an impact, perhaps there is a better way of creating this sense of luxury. Ultimately, charter services will not save the land-based casino industry because, as things stand, it does not need saving. The segment faced impossible challenges over the last two years and has rebounded in astonishing fashion, with many operators across the country reporting record revenues. These services can offer something new, though. As Lupo highlighted and as is present in every piece of marketing involved from operators, charter airlines can work to build upon the identity that the land-based industry wishes to portray to its customers: an exclusive, luxurious, once-in-a-lifetime experience. The offering also clearly taps into a want among the American population that has arisen in response to lockdown. People want to get away after months inside, and when it is safe to do so, these operators are clearly ready to fly you from almost anywhere to experience the nation’s premium casinos. Moreover, these services act an interesting balance to the ease and simplicity that mobile has brought to gaming, conjuring a traditional image of the casino, of well-dressed patrons and high rollers. There are questions that operators must identify solutions to, specifically ones related to the sustainability of the aviation industry in general. When contrasted to the cornucopia of sustainability efforts operators engage in, the choice to invest in an industry that is distinctly unsustainable should be examined. Overall, the rise of the charter service is an interesting phenomenon, part convenience part luxury, and it will be intriguing to see where this takes the land-based casino sector in the years to come. GAMINGAMERICA 41

ROUNDTABLE

ROUNDTABLE: A LOOK TO THE FUTURE OF GAMING TECHNOLOGY CATH BURNS, Executive Vice President of Customer Experience Solutions, Aristocrat

Cath Burns is Executive Vice President of Customer Experience Solutions at Aristocrat. She has a track record of delivering high growth, performance improvement and organizational change in general management, and commercial roles across multiple continents. She has previously held roles as SVP Gaming Systems at Scientific Games, Group CEO at TCSJOHNHUXLEY, VP Asia-Pacific for Bally Technologies, and GM Australia and New Zealand for VLC. RACHEL BARBER, SVP and CTO, Gaming and Lottery, IGT

Rachel Barber is SVP and CTO of Gaming and Lottery at IGT. She has over 30 years of global technology leadership experience. Her focus has been in the Lottery and Gaming sectors and her broad experience includes executive leadership of worldwide organizations responsible for R&D, customer deployments of large-scale software systems and infrastructure, professional services, technical sales, operational support and internal IT. Her current scope at IGT includes the development and deployment of all of IGT's land-based casino, VLT and lottery products. ANDREW BURKE, CEO, Bluberi

Andrew Burke, CEO, joined Bluberi in 2020. Andrew brought with him over 15 years in gaming and private equity experience. Prior to his position, he served as the Senior Vice President of Slot Products at AGS, where he led the process of implementing strategies that helped get games like Colossal Diamonds into casinos across the country. RUKKU RUPANAGUDI, CTO, OPTX

CTO at OPTX, Rukku Rupanagudi has over 18 years of working as an engineer who organically grew into management. He has had a range of experiences in building and leading engineering teams, architecting and engineering scalable systems and developing SDKs.

CASEY CLARK, Senior Vice President, American Gaming Association

Casey Clark is Senior Vice President, Strategic Communications at the American Gaming Association (AGA). As a member of the senior leadership team, he drives organizational strategy and operations and oversees communications and research aimed at protecting and enhancing the reputation of the $261bn gaming industry. Clark serves as a primary spokesperson on industry and association priorities. Moreover, he crafted the AGA’s communications strategy to advance legal sports betting following the landmark Supreme Court decision invalidating the Professional and Amateur Sports Protection Act of 1992. 42 GAMINGAMERICA

ROUNDTABLE

CATH BURNS:

RACHEL BARBER:

Contactless, cashless and assurance are the budding emerging technologies of 2021. Covid-19 as the catalyst created the demand in the post-pandemic era. Operators and regulators re-evaluated guest engagement to ensure safety, and cashless was the answer to cleanliness and contactless needs of the industry. Regulators were quick to accelerate the review, approval and adoption of contactless, cashless, and assurance solutions for guests.

Without a doubt, cashless technologies have pushed the gaming industry forward in 2021. IGT had been introducing cashless solutions prior to Covid-19, but the pandemic certainly accelerated the need for this innovation and brought it to where it is today. Over the last 20 months or so, we have refined our cashless offering to create the industry’s only fully integrated, turnkey cashless solution: IGT Resort Wallet with IGTPay. As modules of the IGT ADVANTAGE casino management system, Resort Wallet enables operators to offer “carded cashless” or “cardless cashless'' gaming, and in combination with IGTPay, provides players access to external funding sources such as bank and debit cards and e-wallets. We formed several strategic partnerships to deploy our cashless solutions throughout the US in 2021 and look forward to expanding this technology further in 2022.

WHAT BUDDING TECHNOLOGY PUSHED THE GAMING INDUSTRY FORWARD IN 2021 ANDREW BURKE:

RUKKU RUPANAGUDI:

The pandemic accelerated the demand for contactless payments. Cashless solutions with Mobile apps and BLE/NFC helped for contactless card-in and payments, pushing the gaming industry. Cashless also aided the conversion of brick-and-mortar customers to online wagering.

The widespread adoption of online gaming has clearly been a catalyst. I think we are just on the forefront of innovation here. In the US, as more states come online, there will be more opportunities to innovate and to tie the terrestrial experience with the online gaming experience. I know that over at Bluberi our minds are whirling with possibilities on how to take advantage of the opportunity. There are truly exciting ways that we can engage players both online and then again at the casino with the adoption of online gaming.

CASEY CLARK:

2021 was gaming’s omnichannel turning point. Motivated by a pandemic-driven shift in player behavior, there was an industry-wide push to deliver a true integrated experience enabling players to engage how, where and when they want to. The introduction of sophisticated player wallets with integrated digital payments provided the technology needed to create a convenient, streamlined experience for our customers. This new technology supports customer loyalty, taking a player from the Las Vegas strip to a sports betting or iGaming app at home. Beyond the technology, what’s most impressive is the collaboration between suppliers, regulators and operators that enabled this innovation. We saw competitors form partnerships to reduce friction points, regulators introduce flexible rules that will adapt with new technology, and operators embrace mobile as complementary to retail.

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ROUNDTABLE

CONVERSELY, WHAT TRADITIONAL GAMING TECH DO YOU BELIEVE COULD SOON BE REPLACED

CATH BURNS:

Traditional high-contact players club and cage systems may need to evolve as regulators consider adoption of remote registration, ‘Know your Customer’ (KYC), and wagering account activation possibilities. These innovative mobile technologies will continue to innovate and displace legacy systems as operators work to protect guests from emerging Covid variant threats while delivering world-class brand engagement. One of the new approaches that will drive guest engagement is the singular player account, the mobile transformation of legacy progressive, bonusing and offer management. Consolidation of these traditionally land-based promotional features will benefit the guest regardless of whether they are on or off the property. The combination of these exciting features with the continued adoption of contactless, cashless, and assurance will catapult adoption by creating a convenient, seamless mobile experience for casino guests.

RUKKU RUPANAGUDI:

I believe that cardless and cashless solutions will develop further, pushing traditional card readers, printers, ATMs, TITO to be replaced with the mobile apps, BLE, NFC and Wallet.

RACHEL BARBER:

I don’t necessarily think any technology will soon be replaced, but rather that there is a gaming evolution taking place. New technologies and types of gaming are emerging to accommodate a variety of players and gain new ones along the way. Cashless is a strong example of this, along with sports betting. Legal sports betting is still a relatively new concept for many states looking to boost revenue by allowing sports fans to place wagers. In less than four years, that experience has progressed significantly through platform technology, self-service kiosks, risk management, etc. At G2E 2021, the IGT PlaySports team debuted our new CrystalFlex and PeakBarTop Flex cabinets and multigame software offer. This type of cross-channel gaming is essential for future innovations in the industry as it offers entertainment for many different players.

ANDREW BURKE:

I don’t think we will see something be replaced. I think we are more likely to see things change and converge. Pundits have predicted the downfall of slot machines since the internet was first invented; however, if you look around the world many technologies and industries are able to survive in both formats and in hybrid formats. Look at retail and restaurants – you can order food online and pick it up, or, if you prefer, you can go sit in the restaurant and have that experience. You can order items to pick up from Target or Walmart or you can go to the store and browse the shelves. In both of these scenarios, the advent of the online shopping or ordering experience has enhanced the overall consumer experience. I think that is the golden opportunity in front of us in gaming.

CASEY CLARK:

Gaming is known for continually innovating to keep our customers engaged and excited – adopting new technology to enhance the experience. This constant innovation is a hallmark of our industry. This is evident in the industry’s efforts on payments modernization. Digital payments aren’t going to replace cash on the casino floor. Rather, we’re enhancing the experience to provide customers flexibility and introducing the same payments options our customers are accustomed to in every other aspect of their life.

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ROUNDTABLE

ANDREW BURKE:

Cashless is a good thing. Some markets such as Mexico have had cashless for years, and players understand the product and use it easily. There is still quite a bit of friction in the cashless process today. We are seeing too many steps to sign up, upload cash, and then transfer it to the right app. Over time, as the barriers lower, cashless will become the standard in our business. Whether that takes 12 months or 60+, in the end everyone will benefit from more widespread adoption of this technology.

HOW CAN CASHLESS CHANGE GAMING FOR BOTH OPERATORS AND SUPPLIERS

CATH BURNS:

Cashless will change gaming for both operators and suppliers similar to that of coinless adoption over a decade or so ago. The entire industry transformed overnight as both supplier and operator worked together to convert floors, and create efficiencies with a more elegant solution. Customer Experience (CX) solutions will deliver greater integration and collaboration between digital, land-based and contactless partners. This will continue to grow in 2022 and beyond.

CASEY CLARK:

Advancing digital payments is a win-win for not only the industry, but customers and regulators, too. Payments modernization enhances our already strong responsible gaming and anti-money laundering efforts, while providing deeper insight into customers. It’s also essential technology for expanding the omnichannel experience. For customers, digital payments give them the choice and convenience to pay the way they want to, while providing additional play management tools and the confidence that their payments are secure. Advancing payments modernization provides federal agencies and regulators with greater visibility into where funds are coming from, who is using them and how. This information enhances already strong anti-money laundering regimes, complements the industry’s Know Your Customer efforts, and furthers our position and partnership with FinCEN on BSA and AML.

RACHEL BARBER:

The cashless model may be relatively new to the gaming industry, but consumers have been using cashless technologies for everyday purchases for a while now; through a variety of apps and digital wallets. I think that is important for operators to remember when thinking about adding cashless to their casinos. Additionally, cashless offers more operational efficiencies by reducing cash handling and the associated security risks or errors, lessens machine maintenance, and provides a cleaner and more convenient experience for the player. Additionally, operators are able to leverage funding data so they can offer improved promotions to players. On the supplier side, IGT views cashless technologies in the same way we viewed and led the Ticket-In, Ticket-Out (TITO) revolution over 20 years ago. That spirit and commitment to innovation is the reason we filed a patent early last year that enables players to transfer Bitcoin from their online wallets to their account at a gaming venue. While there is still much discussion to be had about cryptocurrency in the regulated gaming space, we are heavily invested in cashless gaming and will continue to work closely with operators, to provide them with the best cashless solution to fit their business.

RUKKU RUPANAGUDI:

Cashless is going to make it easier to track the wagering habits of customers, creating a system of easy exchange and promoting responsible gaming. Cryptocurrency will also become an additional aspect of the gaming industry with ashless. Not only is this a game changer for operators, but for suppliers as well, by bringing new technologies, IoT devices for payments, etc.

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ROUNDTABLE

WHAT TECH INNOVATION DO YOU SEE BEING CENTRAL TO THE GAMING INDUSTRY IN THE COMING YEARS

CATH BURNS:

2022 will see more guest and employee-facing modules to help respond to guest demands for a more frictionless immersive experience when engaging with an operator's brand. The industry will see an acceleration in the deployment, adoption and engagement with guests, with digital and land-based operations blurring lines. The guest experience will become more immersive with online, digital and game convergence and the consolidation of mobile applications. The benefit of the Aristocrat digital cashless solution is that it allows operators to offer the same experience for a player whether they are at home, at the resort, or on the gaming floor.

ANDREW BURKE:

RACHEL BARBER:

With the continued growth of iGaming throughout the US, I’m expecting to see a big push for omnichannel content between land-based and digital – a concept IGT has already been acting on for years. IGaming allows us to take well-known brands, and top-performing land-based titles, and translate them into digital games that players can play from the convenience of their home or mobile device. In 2016, IGT launched Powerbucks in Canada, an omnichannel wide area progressive that connects its jackpot liquidity between land and online casinos. This has paid out nearly $39m since it debuted. When it goes live in New Jersey, IGT’s digital Wheel of Fortune® Gold Spin™ Triple Gold® game will be linked with all land-based Wheel of Fortune $1 wide area progressives. This type of omnichannel content gives players additional choice, and convenience, for when and where they enjoy their favorite games, which will continue to be important in the future.

RUKKU RUPANAGUDI:

In the coming years, IoB (Internet of Behaviors) will become essential to the gaming industry. With the help of IoB, operators are going to be able to improve the employee efficiency and quality of services and products to guests. According to a global research by Gartner, it is expected that 40% of the global population will be tracked digitally using IoB by 2023. OPTX is heavily investing on IoB to take this innovation in the hands of casino operators.

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I believe we need regulatory innovation more than a traditional gaming innovation at this point. Consistent standards across jurisdictions would give gaming manufacturers the best chance of building great products for all consumers. The more streamlined the regulations, the more time and effort companies like ours can spend on the consumer experience, rather than trying to get our tech to work across a multitude of jurisdictions with different requirements.

CASEY CLARK:

Thinking back to G2E 2021, the innovations on display drive toward an immersive player environment. We are creating an entertainment experience that combines visuals, sound and content in a new and compelling way that speaks to the next generation of customers. The industry’s future lies in coupling this immersive experience with omnichannel strategies, providing a seamless experience between the brick-and-mortar casino and online environment. This type of innovation puts customers first, meets players’ demands and drives engagement both online and in-person. No matter the channel, importantly, our offerings prioritize responsible gaming and offer player protections that don’t exist in the illegal market.

SPORTS BETTING, PAYMENTS

GROWING TOGETHER Gaming America speaks with Mandi Hart, Chief Client Solutions Officer at Sightline Payments, and Christopher Justice, President of Global Payments Gaming Solutions, to discuss the budding relationship between operators and payments brands, asking the question: Just how profitable will US sports betting be for the payments world? It is no exaggeration to say our lives would not be the same without the advancements in payments technology that have occurred in recent years. Be it the convenience of cashless or contactless payments when purchasing your morning coffee, or splitting the bill with a friend after a good meal, the changes that payment technology companies have brought into everyday life alter the way we live. This fact is no more pertinent than in our industry. Advancements in payments technology allow for quicker, safer and more reliable betting and gaming. Curiously, an industry that has seemingly grown concurrently

with the world of payments is the nascent, but undeniably booming, sports betting market in the US. These developments have arguably allowed for online sports betting to dominate the US gaming market in recent years, and at Gaming America we have become increasingly intrigued by the budding relationship between sportsbooks and payment brands, leading us to seek out some of the best-informed voices in the industry to talk us through this connection. On our minds were some key questions regarding this relationship: Do payments companies take a different approach GAMINGAMERICA 47

SPORTS BETTING, PAYMENTS

to sports betting transactions compared to online casino? Are sports bettors involved in more transactions than other users? And perhaps most importantly, is sports betting more profitable for payments companies when compared to other gaming segments? We brought these questions to Mandi Hart, Chief Client Solutions Officer at Sightline Payments and Christopher Justice, President of Global Payments Gaming Solutions and member of the American Gaming Association Board of Directors. What we found out both highlights the growing importance of sports betting to payments companies, while simultaneously reinforcing the key role more traditional forms of gaming play in sustaining our industry. “Whether sports betting or online casino, the individual customer's expectations are paramount,” Hart noted on the different approaches patrons take to gaming. “Sports bettors may be more cyclical and seasonal in their wagering. Online casino players are usually more consistent with their wagering since they can play an online slot on a regular basis. “That said, the fundamentals of payments processing are the same for all types of gaming. Consumers are not typically wondering about their payment technology when checking out on Amazon, buying groceries with mobile wallets or paying for their Uber. They simply expect it to work with the tap of a button. It’s all about moving money securely and conveniently.” In regards to the same question on a company’s approach to sports betting customers, Justice concurred, highlighting the importance of both sets of users: “Online casinos and online sports betting are just a few of the emerging ways the gaming experience is being extended online. Global Payments Gaming Solutions is helping our partners capitalize on these opportunites by offering solutions to help simplify the funding process for both online casinos and online sports betting.”

"CONSUMERS EXPECT THE TAP OF A BUTTON. IT’S ABOUT MOVING MONEY SECURELY AND CONVENIENTLY." With the ever-growing influence of sports betting on the US gaming market, we wanted to know just how many transactions sports bettors make compared to their peers. Hart says: “With the expansion of legal sports betting across the US, fans in over half the country can legally bet on their favorite team, integrating sports betting into the fan experience like never before. Sports bettors typically have less frequency 48 GAMINGAMERICA

MANDI HART

in their transactions, but the transaction values may be higher. The transaction volume follows the seasonality and inflection points of a sports league. For example, the lion’s share of wagers on professional football in the US is in the fall and winter, culminating in the Super Bowl, which is perhaps the most heavily bet-on event in the entire marketplace. “Online casino customers, on the other hand, can interact with iGaming much like they do within brick-and-mortar environments. Each played game requires a new deposit. Online poker, however, may be the outlier among online casino games since the typical player transaction more closely resembles that of sports betting than online slots or table games.” Interestingly, Global Payments has found different results, claiming: “Online sports betting and online casinos are both booming market segments. Recently, sports bettors have been involved in more transactions, especially as more states legalize sports betting. According to Forbes, if betting becomes legalized in all 50 states, estimated revenue will exceed $19bn a year.”

SPORTS BETTING, PAYMENTS

retention and omnichannel exposure are king. “Volume of transactions is a key metric for assessing customer value, and online casino customers are typically processing higher quantities of transactions than sports bettors are. However, the real driver of customer value is the ability to connect an operator’s omnichannel ecosystem together. “If a patron uses the operator’s mobile sportsbook, that patron can be exposed to an integrated network that includes loyalty and rewards for on-property use. The operator’s online slots app can similarly build this same loyalty into the customer’s experience and incentivize a customer to head to the brick-and-mortar location, to play the same slots in person. “Capturing more transactions on and off property allows operators the chance to personalize loyalty programs. Seamless omnichannel payments strategies are the key to creating a loyal customer base that will visit the operator’s property and gamble online.”

"ADVANCEMENTS IN PAYMENTS TECHNOLOGY ALLOW FOR QUICKER AND SAFER GAMING." CHRISTOPHER JUSTICE

What do these contrasting views tell us about the relationship between sports betting and payments companies? Perhaps most importantly that these are two industries growing together, and it is too early to concretely place sports betting at the top of gaming’s payments pedestal. Concurrently, this intriguing difference of opinion could reflect that, as gaming continues growing, payments companies will find their own niches, niches that will be reflected in differing approaches and financial data. Important for all brands is of course, revenue. So, does sports betting, as we are increasingly seeing for operators, account for higher income than other segments for payments companies? Justice seems to think so. “While sports betting is more profitable for payments companies at this moment in time, it is vital for operators to pursue both market segments," he says. Sightline Payments took a different approach to our final question. Revenue is important, Hart argues, but customer

When beginning research for this piece we felt we would find sports betting’s growing dominance had already imposed itself on the payments world. Yet, it would seem the answer is far more complex than that. Payments companies such as Sightline Payments and Global Payments Solutions are undoubtedly embracing the segment; however, they clearly value more traditional gaming segments and in some cases believe these activities can bring more loyal and long-term customers than the occasional bet on this weekend’s game. Other factors are undoubtedly central, such as betting volume and customer retention, but what stands out is the importance of omnichannel exposure. If a company can expose players to its omnichannel solution, the rest will follow – be it via sports betting, iGaming or land-based payments. The budding relationship between payments companies and sports betting as a segment is just that then, budding, growing and in its early stages. Sports betting is not yet predominant enough to be these organizations’ biggest revenue maker, and the behavior of sports bettors is, due to its seasonality, too irregular to be the focus all year round. That does not mean sports betting will not play a central role in the success of payment companies in the future, or that it is not important to them now. But it does highlight that, as with much of the US gaming market, there is tremendous room to grow. GAMINGAMERICA 49

JCJ ARCHITECTURE

THE GAME OF DESIGN Gaming America sat down with JCJ Architecture's Project Director Mike Larson and Business Development Manager Jeanne Muscolino, to discuss the trends defining casino design in the US right now. How did JCJ Architects come to design casinos? Jeanne Muscolino: JCJ has been in operation since 1936. It was really our reputation for high-quality documentation that brought us to the gaming market, and that started with Foxwoods Resorts beginning in the 1990s. We had the opportunity to work with the Mashantucket Pequot Tribe here in Connecticut. From there, our body of work really snowballed. As you know, Foxwoods were pioneers in the industry and the networks that we were able to develop from that one project was really sizeable; carried off across the country. From there, we opened up in California, becoming bi-coastal through an acquisition. Since then, we’ve opened seven offices. Our body of work in gaming encompasses hundreds of projects, a nice split between operations on the commercial side and some of the biggest tribes out there.

What trends do you see emerging in architectural casino design? Mike Larson: This has been an evolving trend for decades really, but I think we are on a very accelerated path towards a more seamless integration of entertainment into the gaming floor. That spans a pretty wide spectrum, whether it’s music or things you would more traditionally see on the casino floor, to things that are more avant-garde. Sports, especially, is big here. The sports entertainment world is smashing up against the casino world with tremendous force right now. The mergers and acquisitions you see in this industry are tremendous; the partnerships are pretty incredible when you think that, five years ago, you couldn’t have an NFL exhibition game in a city with a casino. That was unthinkable. Now you have sports games in casinos, and sports betting organizations coming together to what everyone thinks is 50 GAMINGAMERICA

nothing short of an incredible opportunity for growth and integration with a new customer base. So, we’re seeing that get integrated with casinos in exciting ways. Sportsbooks are an enormous part of our business right now. Even in the last two years, that product has evolved. Everybody is trying to figure out what that means. As those sports betting organizations get more integrated with traditional operators, those ideas are permeating the casino floor. It’s exciting. It’s extending beyond the casino floor too, to food and beverage. There is that urban context, if you will, that is Las Vegas where we see – probably better than any place in the world – sports venues coming in to play with property design, but also civic master planning. People want to create this seamless integration between entertainment, sports and gaming. Historically, the gaming revenue in the greater resort formula has diminished as other sectors have risen. It’s kind of been the Sands model of 'we have a casino floor but we also have a retail establishment.' Those things kind of become separate entities within the same property, but now have become far more integrated as they come together. The gaming operators are probably more nimble than other industries to take advantage. JM: I just wanted to elaborate a little bit on Mike’s point. I think it’s really interesting to see how horse betting has driven ties to media. It’s remarkable for me to see dedicated

JCJ ARCHITECTURE

and we need to prioritize with them what the most important functions and things to consider are. But, at the end of the day, we have to bring all of these opinions together.

What’s your take on the mass legalization of gambling that is currently happening in the US right now? JM: It’s absolutely exciting. It’s really interesting to see the level of sophistication that local operators achieve when they are competing on a national level, with the commercial operators that are largely coming out of Las Vegas. It’s raising the game for everybody and it’s exciting in terms of bringing products to areas that haven’t had it before. It’s also exciting when you look at bringing a gaming opportunity or a gaming product to urban centers. You look at the licensing opportunities that they’re talking about downstate in New York and what that might mean for New York City. Everybody is salivating at the opportunity if Texas ever opens its doors and what that might mean to urban centers like Dallas. That’s very exciting. It’s interesting to consider what the integration of gaming facilities might mean for the urban centers around the country.

What significant projects does JCJ Architecture have in the pipeline?

space for media carved out at casinos. You’ve got ESPN at the Lynx, Vision at Circa, Blue Wire at the Wynn. I think that’s something that’s just getting started. But the world of media and technology, and gaming and entertainment, all of these things are coming together in a way that will continue to evolve. ML: We’re hearing from our clients to that point. Their metrics are changing in how they measure the success of their enterprises. When media comes in, they have metrics that they measure in terms of eyeballs, time and engagement, and things like that. In an abstract way, gaming operators have used those devices in the past but they always have a dollar amount attached to them, whether it’s a table game, or a slot machine or something like that. Now they view things differently, more in line with media companies nowadays, and it’s very interesting. It’s creating many opportunities for just more things on the casino floor.

How do you balance competing interests and parties as you go into the designing of a casino? ML: There is certainly a level of prioritization in how we go about including the differing opinions of stakeholders. Frequently, there could be two or three, or half a dozen different stakeholders at the table. They’re all part of different groups or organizations. Ultimately, we’ll have a client that takes the lead,

ML: JCJ Architecture has a wide range of gaming projects across the country, both recently completed and in the pipeline. The firm is currently working on multiple projects for several of the gaming industry’s notable brands, including MGM Resorts, Bally’s, Resorts World, and Penn National. For Penn National, JCJ just completed Hollywood Casino York and anticipates the opening of Hollywood Casino Morgantown in a few weeks (at press time). Both projects are in Pennsylvania. The firm is also collaborating with Caesars on the rebrand of Harrah’s New Orleans, to its namesake Caesars brand. Also in the pipeline for JCJ is DraftKings at Casino Queen in St. Louis, Illinois, a project that will introduce a sportsbook and dining promenade with new food and beverage options to the existing casino, to enhance the guest experience. This August, JCJ Architecture wrapped completion on the major expansion of the Choctaw Casino & Resort in Durant, Oklahoma, as well as the FireKeepers Casino Hotel expansion in Battle Creek, Michigan. Both projects involved greatly increased the amenities of the existing campuses.

Do you have any final comments for our readers? JM: As we talk about the entertainment component, there are a lot of new players coming to the market, a lot of new partnerships being formed, whether it's in Las Vegas or elsewhere. There are new ideas and operators coming to the casino floor and they’re bringing with them new partnerships. Entertainment partners, food and beverage partners, all of that is the fuel for innovation. I think we are on the cusp of a new phase of that in the industry and we’re really looking forward to it. GAMINGAMERICA 51

SCIENTIFIC GAMES

SHUFFLING OUT THE LOTTERY Legal expert, Gus Petropoulos, who advised Scientific Games from 2011-14, discusses industry M&A plans. As M&A activity surges to record levels, Scientific Games and International Game Technology (IGT) are using the frenzied seller’s market to rationalize their product offerings and de-lever their balance sheets. The 2013 purchase of WMS Industries, Inc. by Scientific Games kicked off a series of transactions involving SHFL Entertainment, among others, that consolidated much of the casino gaming equipment industry in the hands of two lottery operators; GTECH, formerly Lottomatica SpA, and Scientific Games. These two companies are now leaning into M&A to divest what have become non-core assets and to maximize their competitive advantages in a rapidly evolving gaming industry. Consolidation of the gaming equipment industry diversified the businesses of Scientific Games and IGT but also left them highly levered. Covid-19 and its silencing of casino floors turned digitization into an existential requirement. In the last year, IGT sold its legacy Italian B2C gaming machine and sports betting businesses, while Scientific Games announced plans to divest its lottery and sports betting arms. Changes are occurring

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that see companies prepare for a future were we purchase lottery tickets online, and even land-based casino operations require complementary digital peripherals like cashless payment. Corporate boards across gaming are monetizing non-core assets and refocusing strategies on areas with the highest perceived growth potential, including scalable land-based and virtual products. The suddenness with which the pandemic upended the ordinary course of business has emphasized the cost of delay and, in many cases, has created a strong preference among corporate boards for quickly acquiring capabilities over internally developing them. Scientific Games and IGT are focusing on casino equipment and systems, as well as online and social gaming. These former lottery competitors are using the current opportunity to pay down their legacy debt while investing in the future, by securing maximal value for non-core assets. If M&A is viewed as a good way to redeploy assets and retool focus, then liquidity options have never been more plentiful. In September 2021, Scientific Games

SCIENTIFIC GAMES

GUS PETROPOULOS

announced the sale of its OpenBet sports wagering business to Endeavor Group Holdings, Inc. which itself IPO-ed only earlier this year. Two months prior, it had announced the divestiture of

its lottery business, which it stated could take the form of an IPO, straight private equity or strategic sale, or combination with a special purpose acquisition company (SPAC). Indeed, hundreds of existing SPACs are still searching for targets. Regardless of how it happens, Scientific Games successfully exiting lottery will reshuffle the deck and foreshadow further near-term changes within gaming. In no more than two decades, the company will have transitioned from racing systems, to lottery, to casino and online gaming. Risks to the current M&A boom have come into view in the form of inflationary pressures that may pause the era of cheap money; changes to the capital gain tax regime that may shrink seller proceeds; and assertive regulators that restrict options for companies in particularly concentrated or sensitive markets. Goldilocks conditions to transform one’s business continue for now; however, many foreign markets that typically lag the US have only just begun participating in the M&A boom this year. The experience of Scientific Games and IGT shows the necessity of constant change, even when that means shuffling out your legacy business for something new. The experience of Covid-19 shows the costs of delaying such change generally, as well as the penalties of slow-rolling new technologies specifically. As gaming M&A shuffles the deck ever faster, an increasing number of players are pulling up a seat. Constantine (Gus) Petropoulos is a corporate partner in Hughes Hubbard’s New York office. From 2011 to 2014, Gus advised Scientific Games on acquisitions, JVs & commercial transactions, including investments in online, lottery and casino.

"THE EXPERIENCE OF SCIENTIFIC GAMES AND IGT SHOWS THE NECESSITY OF CONSTANT CHANGE, EVEN WHEN THAT MEANS SHUFFLING OUT YOUR LEGACY BUSINESS FOR SOMETHING NEW." GAMINGAMERICA 53

TAX REVENUE

REVENUE IN REVIEW Gaming America takes a look at the sometimes controversial, often beneficial relationship that state governments have with legalized gambling. With rich streams of puritanism coursing through the nation's veins, gambling sometimes gets a bad rap in the United States. Historically, it has too easily been lumped together with alcohol and tobacco, constituting the third prong in a triumvirate of sin. While this perception is changing as gambling becomes increasingly legal, there is still a sense in which legalization must be justified (as if freedom itself was not justification enough). And how is this pastime – so well loved by so many millions – justified? By the bottom line, of course. In the spirit of fortifying the arguments for expanded legalized gambling, we propose a closer look at where the revenue, once collected, in fact goes. While tax revenue from gambling usually goes to programs and initiatives that would otherwise have nothing, every state has a different approach regarding how to divvy up the revenue.

"POLITICIANS LIKE GAMBLING BECAUSE IT ALLOWS THEM TO RAISE REVENUE WITHOUT HAVING TO RAISE THE TAXES OF THEIR CONSTITUENTS." There’s certainly a lot to go around. According to the American Gaming Association (AGA), commercial gaming in 2019 (the last ‘normal year’) generated $41bn nationwide, and the growth of the industry shows no signs of letting up. In total, this led to $10.2bn in tax revenue. The potential for more is even greater. The 10 years from 2009 to 2019 saw tax revenue from 54 GAMINGAMERICA

legal gambling double. The AGA predicts that there is still $150bn in illegal bets going on every year. That’s a lot of green to tax. Governments are addicted to revenue. They always have been since the days of the Fertile Crescent. Lately, though, times have been hard in the US. The 2008-9 recession, chronic tax cuts and, most recently and significantly, the Covid-19 pandemic all put a major dent into revenues across the country. It was this revenue crunch, stemming from these crises, which provides the setting for the wave of legalized gaming across the nation. Governments simply need the money. There are a few things to remember when considering this issue. First, every state taxes at a different rate, some favoring ‘high-tax regimes’ while others favor ‘low-tax regimes.’ The recent opening up of legal gambling in New York state is a classic example of a high-tax regime. In fact, New York has the highest tax rate in the country for gambling: 51% of revenue.

TAX REVENUE

That’s not atypical for New York, which has a notoriously high tax regime anyway, but it does strain the ability for casinos and operators who want to be in the market. A tax rate so high simply makes it a struggle to cut a profit. New York – the location of America’s biggest and most visited city – can afford to take the risk. The second-highest tax rate in the country, Pennsylvania, is lower at 40%. Every other state with legal betting operates at a lower rate than this. The average tax rate on gambling in any given state is about 10-20%. Secondly, it is not uncommon for there to be multiple entities calling for taxes. Say you are a casino operator in Chicago, you will be paying a 2% rate to the city, another 2% to Cook County, and then another 15% to the state of Illinois! It is difficult to understand the benefits legalized gambling and betting brings to a locale because there are all of these different tiers. Thirdly, different categories of gambling face different taxes. The lottery, for instance, will face a different tax rate then a commercial casino, which in turn will be taxed differently than a sportsbook. Tribes, as well, will be taxed at a different rate than non-tribal operators. Despite these various factors, revenue from gambling is often set aside for incontestably beneficial expenditures, such as education or senior care. If this revenue is not given toward one of these ostensibly good causes, it is simply lumped into the general fund. Art and cultural funds are a favorite destination for gambling revenue. In Colorado, all revenue from gaming tax, as well as from license and application fees, is placed in what is known as the Limited Gaming Fund. From this, $2m is transferred to the creative industries cash fund – overseen by Colorado Creative Industries (CCI) – to be doled out as grants or to support other aspects of creative output. In 2018, every cent given to the CCI came from gaming revenue. Iowa follows a similar pattern: revenue from legalized gambling is given to the Department of Cultural Affairs. Half of the money goes to operational support grants, while the other half goes to the community cultural grants program. In 2018, a quarter of all the money received by the Iowa Arts Council came through these means. Altogether – in addition to these two states – Kansas, Maryland, West Virginia and Wisconsin all fund their arts programs in a similar fashion. In 2018, an average of 38% of these states’ art funding cames from gaming. Lotteries follow a slightly different pattern. State lotteries tend to have been around for longer. Modern lotteries began proliferating around

the country in 1964, and today 45 states and the District of Columbia offer some version of it. Sometimes the take from lotteries can be a significant portion of the budget. Eleven states raise more money from lotteries than from their state corporate income tax. Money from lotteries most often goes to supporting education. Texas, for instance, has seen $22bn of lottery money (over a quarter of total funds) going toward public education since 1997. But, again, there are variations, as states choose how to spend the money. The Pennsylvania Lottery has been ongoing since 1972. In that time, $29bn in lottery revenue has been steered toward programs that help seniors and older residents. Colorado is one of the most scenically beautiful states in the country, and lottery money goes toward preserving this, and is spent on parks and trails. One area that states often fund when introducing commercial gaming is programs which treat gambling addiction, which is a relatively small problem in the grand scheme but a central issue for the industry: the National Council on Problem Gambling has determined that 1% of American adults are considered to be gambling addicts, while 2-3% are problem gamblers. This can be minimal. Of the $1.1bn that Pennsylvania raises from gambling taxation, only about $5m a year goes to address this issue. Obviously, the promise of increased revenue is not enough for some. Utah, with its strong Mormon contingent, is unlikely to allow gambling in the near future because of religious objections. Usually, what is required to allow gambling is a deal with already existing players in the market. For example, California was on the cusp of implementing sports betting legislation – this, bill sponsors estimated, would have generated as much as $700m in tax revenue – but opposition from tribal casinos meant that the bill died on the vine. Still, the benefits are undeniable. The stabilization of Detroit’s budget? That was thanks to the rise of sports betting and iGaming in the state of Michigan. And in Maryland, there was a deficit in the state’s education trust fund. Now that people are playing 12% more than they were before the pandemic, that deficit is gone. As the star of legal gambling continues to rise, so too will the benefits the activity’s tax revenue brings to the people.

GAMINGAMERICA 55

DR LAILA MINTAS

THE CASE SO FAR: LAILA MINTAS AND PLAYUP GO TO COURT We look at the details regarding the lawsuit between PlayUp and former US CEO Dr Laila Mintas, following the denial of the operator's emergency restraining order request in January. Over the course of the last two months, a legal dispute has arisen between PlayUp, an Australian-based sports betting brand operating in the US, and former CEO Dr Laila Mintas. PlayUp accused Mintas of working to undermine a $450m takeover attempt by cryptocurrency exchange FTX. Following her initial victory in court on January 5, 2022, we review the situation. In mid-December, following PlayUp’s initial accusation, and the decision of the court to grant an emergency restraining order, Mintas had this to say to Gaming America: “I am a major shareholder in PlayUp as of today and invested seven figures of my own savings into the company. It makes no sense that I would have made any of those comments that are quoted in the filing; or tried to destroy a deal to sell PlayUp, as I would have benefitted from that as well as all other shareholders. All the claims mentioned in the filings are wrong and my lawyers are working on filing shortly my response to those claims to tell the true story based on written evidence. She concluded: "If someone tries to prevent you from speaking to the US regulators, that says everything.” As the case developed, Mintas moved to present her counter to PlayUp’s accusations. Indeed, the evidence provided by Mintas in her response included the claim that PlayUp’s Global CEO, Daniel Simic, attempted to add $170m in side-deals on to PlayUp’s asking price, which can be found on page 43 of Mintas’ court filing. Secondly, Mintas highlights an email, found on page 47 of her court filings, that was reportedly sent by FTX, and allegedly confirms that her actions had no impact on the acquisition. The email, sent by Ramnik Arora of FTX on November 24, states: "After much consideration, we've decided against a full acquisition. There are a few concerns from our side." Reasons found in the email include a disconnect within the team and the board on valuations, as well as a mistrust and lack of communication between the US and the global businesses. Additionally, it cites conflicts of interest among the leadership regarding the 56 GAMINGAMERICA

PlayChip brand. As of January 5, PlayUp’s request was denied by the US District Court for Nevada, which found that Mintas’ claim (that FTX’s takeover failed due to Simic adding $170m in side-deals to the FTX asking price, and subsequently using Mintas as “scapegoat”) was more likely. The court’s judge, Gloria Navarro, stated: “The defendant provides substantial evidence in her response to the preliminary injunction that her comments did not cause the sale to fail; and plaintiffs did not otherwise provide evidence that the defendant even likely made a disparaging comment to FTX. It was just as likely or more likely that the actions of Daniel Simic are the ones that caused the negotiations to cease irreparably” As things stand, Mintas is set to make her counterclaim and has filed for alleged damages of over $75,000. She states the imbroglio has caused “irreparable harm to her reputation, loss of income, devaluation of her shares, among other damages.”

NY MOBILE LAUNCH

NEW YORK, NEW YORK! Mobile sports betting has gone live in the Empire State. New York bettors were able to place their first online wagers on January 8 as the United States’ largest sports betting market went live. New York made US gaming history when its online betting market launched, with four operators. Caesars Sportsbook, DraftKings, FanDuel and Rush Street Interactive (RSI) became the Empire State’s first four operators to offer online sports betting after they were given the green light to accept and process mobile wagers from the New York State Gaming Commission (NYSGC). While nine operators have been licensed, only these four initially launched in the state, while the remaining five continued to work towards satisfying statutory and regulatory requirements. Nevertheless, four operators were enough to see New York outstrip every other state to become the US’s biggest sports betting market during its debut weekend. Data expert GeoComply said that, in just 12 hours, the northeastern state became the number one jurisdiction nationwide for sports betting. Millions of sports fans jumped at the opportunity to place bets on their favorite franchises from the comfort of their own homes. In total, 5.8 million geolocation pings were recorded in the first day, making New York’s debut the single largest for a sports betting market in US history – no other state even comes close. In fact, its debut was more than double that of previous record holder, Pennsylvania. As a result, it should come as no surprise that many were lauding this as a landmark moment for the gaming industry, including Caesars Digital Co-President Chris Holdren, who said: “Today is a historic day for not only Caesars Sportsbook, but for the entire state of New York. We’re ready to treat sports fans across the state of New York like royalty through our Caesars Sportsbook app, as we welcome them into the Caesars empire, extend our already established roots and continue to build partnerships that benefit our bettors.” But what have people been betting on? DraftKings offered

some insights. Roughly 46% of its handle came from the NFL, while a further 24% came from the NBA. College basketball and college football followed suit, accounting for approximately 6% and 5% of handle. In New York’s first weekend of sports wagering, the Kansas City Chiefs was the most bet-on team, followed by the Dallas Cowboys and Philadelphia Eagles. Others in the top 10 included the Buffalo Bills, Indianapolis Colts and Green Bay Packers, as well as local teams the Jets and the Knicks. Chiefs’ quarterback Patrick Mahomes topped the list of the most bet-on players, while the Denver Broncos’ Drew Lock came in second, followed by Travis Kelce and Javonte Williams. Prior to Saturday’s launch, Johnny Avello, a New York native and DraftKings’ Director of Race and Sportsbook Operations, commented: “Growing up in New York and having spent the last 30-plus years in Las Vegas, I am thrilled that my worlds are finally set to collide. Millions of New Yorkers will soon discover what we believe makes our DraftKings Sportsbook the very best in customer service and real-money gaming and entertainment.” The state’s four operators began rolling out massive promotional campaigns almost straight away. Caesars customers, for example, received a $3,000 deposit match and a $300 sign-up bonus, as well as a free NBA jersey. But while many were celebrating the launch of mobile sports betting in the Empire State, Brandy Richards, Team Leader of New York’s Northeast Problem Gambling Resource Center, urged people to take caution when placing wagers. Speaking to CBS 6 Albany, she expressed concern that the increased accessibility of mobile sports betting versus in-person wagering may result in heightened rates of problem gambling. “I think, with anything, when you increase accessibility, the likelihood of problems is also going to increase,” said Richards. “We have concerns about people who may already be struggling with gambling problems or are in recovery.” GAMINGAMERICA 57

MACAU

MACAU: THE END OF THE JUNKET MODEL AS WE KNOW IT? The future of the Macau junket market has dominated gambling industry headlines following the recent arrest of Suncity Group Chief Executive Alvin Chau, over alleged links to cross-border gambling. The junket giant closed all of its VIP gambling rooms in Macau following the arrest. J.P. Morgan analysts then suggested that the region’s VIP revenue would contract a further 30-50% in the coming weeks. Several casinos in Macau have also now reported that they will close VIP rooms run by junket operators. Asia Gaming Brief (AGB) held a panel on the future of junkets and the implications for Asia’s VIP market, with several industry experts sharing their opinions on what will happen next. How will it affect the US operators based in Macau? When asked if he thinks the junket model is dead, Alidad Tash, Managing Director, 2NT8, responded: “It appears so. We all knew that junkets were going to go down, it’s been going on since 2013, but the last 12/13 days, just the speed by which they’re on the way down and almost going to be diminished is mind-boggling.” Martin Purbrick, Principal, Purbrick & Associates Ltd, agreed

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on the future of junkets, noting: “It clearly is the end of the junket model. I’d also say that it’s not the case that junkets are suddenly illegal in the People’s Republic of China. It’s always been illegal. But in other business sectors, you’ll see that the law is enforced arbitrarily in China, and that’s the point for gambling as well. When the authorities want to enforce the law, they’ll enforce it.” Carlos D. Simões, Partner at DSL Lawyers, explained the legal side of things, noting: “What I would say is that if we’re going to go through the end of junkets, that’s going to happen without minimum legal changes. Junkets have been a licensed activity in Macau since 2004; they are subject to supervision, and although we have gone through this storm since the arrest of Alvin Chau, the reality is there have been no legal changes to the existing regime. “So I would say from a legal point of view that everything is

MACAU

the same... but at the same time, everything has changed.” Simões and Martin returned to the discussion to explain how different parties will be impacted by recent events, with the former saying: “This is going to be a very tough call for the Macau economy overall; because it’s not only the junkets, there’s a lot of activities that serve these VIP players that have been erected to serve them, to bring the best services, and there is a lot of spending in Macau that is related to them. So certainly there will be a major impact, and how this system without the junkets is going to be able to bring players to Macau to keep spending money, that’s a question that at the moment no one can answer. But it will be a problematic one, for sure.” Martin, meanwhile, ponders the issue of how the money moves out of the mainland, for example through pawn shops. “The technical term for that is money laundering,” he says. “And that’s the problem in Macau. So the primary concessions, the license holders, have to think very differently about their model in the future. “The term ‘integrated resorts’ really means that. For the past decade, the primary operators have managed with this junket model and become cash-rich; junkets become cash-rich as well, and junkets have become regional entities in some ways... Sun City of course with resorts in other countries. “So there’s a lot of shakeout from this that, unfortunately, I don’t think will benefit Macau. That demand for gaming from mainland China is definitely still there. It needs to exit the mainland, but where does it go? I sense it will be difficult to go to Macau, because obviously it’s within the PRC borders, and the authorities have greater controls and greater scrutiny on everything. And hence I sense that there’s more of that demand likely to go across the region: maybe even back to Vegas if those players can get their money out of the mainland.” Continuing on the theme of how different jurisdictions will be treated, Ben Lee, Managing Partner, IGamiX Management and Consulting, explained that a system of tiers will perhaps be put in place. “We have seen some constraints already imposed by China on some of these other jurisdictions. So they are not limiting the crackdown on gambling just to Macau. It’s not just a case of different countries or jurisdictions being blacklisted, but it’s also probably a list of different tiers of treatment. “Macau is probably on the lowest tier, so they will allow people to come into Macau, provided they are individually vetted. Same thing probably, maybe tighter, if they would go to Cambodia, as it is a friendly country to China. On the contrary, I haven’t heard of any Chinese tourists being allowed into the Philippines as yet. We do have different tiers and we think that’s what’s happening.” Kelly Amato, Director – Southeast Asia Industrials, Fitch Ratings, weighed in on the discussion with a particular focus on Australia, and one of the major global operators in Crown Resorts. When

asked if there are similarities between what has happened in Macau and Australia, she replied: “In some ways yes. We had the Crown arrests in 2016, so obviously there was heightened scrutiny when it came to VIP betting in China with regards to Crown. “In some respects as well, yes it was probably showing that there was some smoke there, and then in 2019 we had the in-depth media investigations taking place on money laundering and the Chinese gaming laws. After those in-depth reviews, Crown was deemed unfit to hold their license and they are currently going through that remediation process. And out of those reviews, there’s also been a ban on junket operations in Australia now.” Steve Vickers, Founder, Steve Vickers and Associates, suggested it is a significant moment for Macau’s gaming industry, believing it is now a much broader problem than many perhaps initially perceived. “This is a significant change,” added Vickers. “It’s not just about junkets and whether we describe them as premium mass etc, it has gone beyond that, this is a very significant difference; and I think the Government will push very hard to try and turn Macau into something different than it is at the moment.

"I THINK WE CAN PRETTY WELL SAY THE JUNKET MODEL AS WE UNDERSTAND IT IS GONE.” - STEVE VICKERS And staying on the topic of concessionaires, like most within the industry, Vickers was unsure as to what the future holds. “All bets are off,” he stated. “It’s an issue of both business risk and political risk. Each major concessionaire has a slightly different profile. There’ll be a big difference between local and American and foreign ones, given the current rate of relations between the US and China.” And when asked if he believes it is worth bidding for the license again, Vickers replied: “Everybody needs to really analyze what the impact is to their business, as political risk is absolutely paramount right now. It’s time to work out what the options are. I’ve always hated the junket model, I’m surprised it’s lasted as long as it has, but I think we can pretty well say that the junket model as we understand it is gone.” GAMINGAMERICA 59

THE YEAR AHEAD

2022: GROWTH MODE The gaming industry is optimistic going into 2022. Sure there will be supply chain issues, but convergence is exciting, as Gaming America explores. The gaming industry has weathered the cataclysmic storm that was (and to some degree still is) the Covid-19 pandemic, but it is poised to move into growth mode as the calendar flips to 2022. That was the message from six executives who offered Gaming America their views of what lies in store in the year ahead. They noted the virus has not gone away completely and supply chain issues are still confounding a more rapid recovery, yet they were uniformly optimistic about the potential budding in the innovations that have been in the works behind the scenes. Among the boldest predictions came from Cath Burns, EVP Customer Experience for Aristocrat Gaming, and Dave Kubajak, SVP of Sales, Marketing and Operations for JCM Global. Both spoke of the possibility that interconnected gaming finally will make its long-awaited debut in the next 12 months. “The past two years have been both challenging and phenomenal in the advancement of the global gaming industry,” Burns began. “Gaming has long been an industry that delivers waves of innovation. It should not come as any 60 GAMINGAMERICA

surprise that the gaming industry once again rose to the challenge to deliver several key trends and developments in response.” According to Burns, 2022 will see more guest and employee-facing modules to help respond to guest demands, for a more frictionless interconnected experience when engaging with an operator’s brand. She said Covid-19 has accelerated, and continues to accelerate, player demand for contactless, cashless and assurance solutions; and both regulators and operators have been quick to respond with approval and adoption. “These will continue to innovate with mobile solutions as operators continue to protect guests from emerging Covid variant threats while delivering world-class brand engagement,” Burns predicted, adding that she expects the industry will see an acceleration in deployment, adoption and engagement with guests – with the lines between digital and land-based operations becoming blurred. “We can expect the guest experience will become even more interconnected, with online, digital and game convergence

THE YEAR AHEAD

with the consolidation of mobile applications; and integration and collaboration with digital, land-based and contactless partners will grow in 2022,” Burns said, noting these trends are mirroring other industry verticals. The gaming industry has been talking about convergence as a theory for a few years now, Kubajak observed, adding, “all signs are pointing to 2022 as the year when theory becomes reality.” “We will see technology give players the ability to choose their gaming experience and to have that experience interconnected,” he asserted, explaining players will choose their gaming venue, whether that is land-based, online gaming, lottery or a combination. “They also will have greater choice in how they fund their play, including cash, debit, TITO or mobile. As sports betting continues to grow globally, players can choose between going to a land-based sportsbook or making wagers online.” To reward their customers, Kubajak said operators will have a greater range of options for promotion and player recognition, giving players choices between receiving physical promotions (including printed tickets from a system such as JCM’s PromoNet) or virtual rewards (player card/mobile app). As technology creates the necessary interconnections to provide players this “amazing ability to choose when they play, how they play, and how they are recognized and rewarded,” Kubajak said JCM is actively working with casinos of all sizes to help them develop a technology roadmap. “Our forwardthinking roadmap helps casinos plan ahead so no matter what the future holds, JCM can make sure operators have the technological framework in place to give players the choices they will expect.”

IMPROVING THE SUPPLIER-OPERATOR CONNECTION Dan Schrementi, President of Gaming for Incredible Technologies (IT), told Gaming America the gaming industry rebound in 2021 focused on operators’ ability to attract customers “and the results speak for themselves.” “2022 tells a different tale, and I believe one that will focus on the relationship of the suppliers to the operators,” Schrementi said. “As a slot manufacturer, for the better part of two years through the pandemic our teams have focused solely on R&D expenditure to bring our best and brightest ideas to market and create a new, hopeful post-pandemic player experience.” IT expects 2022 will be the year in which manufacturers start what Schrementi described as a new chapter in the industry – one shaped by bigger and bolder ideas. “While supply chain delays will be an obstacle to this focus, it won’t stop the overall momentum and its impact as 2022 rolls on,” Schrementi said. “As manufacturers continue to heal, the end result will be more commercialization of products that offer innovative player experiences for our customers.” Andrew Burke, CEO of Bluberi, took a moment to acknowledge

the headwinds working against the gaming industry going into the new year, starting with labor shortages. He cited a recent report that said there are 11 million open jobs in the US alone. “Factors that make it difficult to hire in other industries affect gaming, as well,” Burke said, pointing to the fact many potential employees are placing more importance on quality of life than ever before. He said companies need to think not only of wages, but benefits such as time off, the ability to work remotely; and to give employees the ability to balance their professional and personal lives equally. “In the 24/7 gaming world, this can be a particular challenge, and we will see that play out through 2022,” Burke cautioned. “Companies that really understand culture, the ones that have taken the time to implement thoughtful policies and work with their employees to understand and meet their needs, will win out.”

"GAMING IS POISED TO MOVE INTO GROWTH MODE AS THE CALENDAR FLIPS TO 2022." Casinos have brought in record revenue over the past year and a half. But in 2022, as live shows and sporting events continue to come back and people become more comfortable attending them, Burke said the industry may see its players spending less time in front of their favorite slot machines, in favor of some of these other forms of entertainment. “Casinos will need to ramp up their marketing efforts to compete for people’s leisure time,” he proffered. “The good news is we have continued to work on our research and development efforts. There is lots of great new product ready to be released, and a lot of pent-up demand for new games.” Casinos spent less money on refreshing their floors over the past two years, but as players start spending slightly less time at the casino, Burke said the replacement cycle should also pick up in an effort to keep the players coming in and staying longer. “2022 may bring about a renaissance on the slot floor,” added Burke.

A NEED FOR COOPERATION AMONG COMPETITORS Burke expects supply chain issues will continue to plague the gaming industry throughout 2022 and possibly into 2023. GAMINGAMERICA 61

THE YEAR AHEAD

He said manufacturers need to have more parts and inventory on hand to offset the shortages, and long lead times they currently are experiencing. According to Burke, manufacturers may find themselves paying higher prices for critical items as they compete with each other to secure available inventory; and they will need to plan for that and be flexible as they move through the year. “Many companies, however, have used this time to evaluate their processes and procedures to be better aligned with customers, and are ready to meet any challenges that come our way,” Burke said. “Bluberi, for one, is in a much better place coming out of Covid than we were going in. Overall, I am optimistic about 2022, and looking forward to a bright future.” Burns said to provide a pathway forward for the industry, Aristocrat supports an open standards interface with Oasis 360 that allows partners to connect to its casino management solution. “For our Oasis partners, we have supplied a unique and established perspective that has helped to enhance the Oasis solution,” Burns said. “Having more than one solution partner allows for operator and guest choice, which drives innovation and adoption in the industry.”

"2022 WILL BE THE YEAR ONLINE GAMING GAINS ACCEPTANCE OVER THE MORE CONTROVERSIAL CANNABIS INDUSTRY." One of the new approaches that will drive guest engagement is the single player account: the mobile transformation of legacy progressives, bonusing and offer management. Burns said consolidation of these traditionally land-based promotional features will benefit the guest regardless of whether they are on or off the property. “The combination of these exciting features with the continued adoption of contactless, cashless and assurance will accelerate adoption by creating a simple, convenient, seamless mobile experience for casino guests,” Burns said.

NEW MARKETS WILL LEAD THE WAY Johnny Ayers, Founder and CEO of identity verification company Socure, predicted 2022 will deliver market growth of 25% to 30% vs. 2021, with New York and Ontario “significantly contributing” to this momentum and increasing the likelihood that other large markets pursue legalization. 62 GAMINGAMERICA

“In a once-undecided race between cannabis and gaming as the preferred new source of revenue for states, 2022 will be the year that online gaming gains clear acceptance over the more controversial cannabis industry,” Ayers assessed. As online gaming providers rush to be first-to-market in states that have legalized, Ayers said speed will be prioritized over all else. However, he warned, this attitude “cracks the door” for more fraud while exposing how manual processes for due diligence and payments management impede operator success. According to Ayers, a rise in fraud attacks will force operators to re-evaluate their approach to fraud mitigation and place more of a premium on effectively mitigating risks, without negatively impacting player experience. “This will happen through accurate identity verification and overall automation across the onboarding, account profile changes and withdrawal processes,” Ayers said. Ayers expects operators will continue to evolve their omnichannel efforts, establishing more seamless player experiences across digital and land-based channels, helping drive increased engagement and overall handle. “This will touch off more investment in player lifetime management programs and optimizing cross-channel experiences to improve player loyalty,” he said.

SECURITY CONCERNS AS MORE STATES LEGALIZE SPORTS BETTING Michael Tobin, CEO of Continent 8 Technologies, believes the gaming industry will experience continued growth in 2022, especially in the burgeoning US market. He noted sports betting is now legal in more than two dozen states, and in 2022 a number of new states will open their doors to online gambling for the first time, possibly including Ohio, Massachusetts and North Carolina. The increase in the number of live states in the US is being matched by an increase in cyberattacks, Tobin said, with businesses around the globe “more vulnerable than ever before.” He said in Q3 2021, Continent 8 blocked 546 DDoS attacks. “This was an absolute record for us and represented an increase of more than 50% from the previous quarter,” Tobin said. “Attacks are becoming increasingly sinister and sophisticated, with DDoS and ransomware the most prevalent. We expect this trend – the rise in volume and complexity of attacks – to ramp up significantly in 2022 and that is why businesses must ensure cybersecurity is a priority. This means putting effective and scalable protections in place today; multi-layered services to address compliance, perimeter and ransomware threats.” Burns of Aristocrat Gaming summed up the outlook for gaming: “Challenging times don’t change who you are – they reveal who you are, and we are proud to be a part of an industry that is strong, resilient and innovative.”

PRODUCT REVIEWS

WHAT’S NEW Gaming America takes a look at some of the market's newest and most exciting gaming products, available for both online and land-based players across the country.

BLUBERI: COLOSSAL DRAGONS Throughout 2021, Bluberi experienced quite a few changes. The slot developer totally rebranded its look and website while restructuring its leadership team, all in the hope of promoting a culture of entertainment and energy. For this product review, we take a look at Bluberi’s new and exciting 576-ways game, entirely built around the pure joy of playing. Colossal Dragons’ Wild symbols are the main attraction in Colossal Dragons, as the feature can lead players to win impressive prizes, jackpots and the entrance ticket to the Dragon Bonus. The screen could end up being loaded with prizes, jackpots and, with

EVOLUTION: LIGHTNING BLACKJACK Lightning Blackjack from Evolution, which was available from day one in both Live and First Person versions, is a unique, exciting, scalable version of Blackjack that features enhanced, multiplied payouts. The multipliers are awarded to a winning hand according to the winning player’s score. The awarded multiplier results in multiplied winnings of between 2x and 25x if the player has a winning hand in the next round. First Person Lightning Blackjack is a 3D animated version of the game. Players enjoy the same exciting gameplay and chance of multiplied payouts, but in an RNG-based game that includes a ‘GO LIVE’ button that can take them directly to the live dealer Lightning Blackjack table. Only available from Evolution, this is a Blackjack variant that offers players a genuinely unique gaming experience with Lightning Card multipliers and enhanced payouts. Like Lightning Roulette and Lightning Baccarat, the game is set in a black and gold Art Deco game show environment and adds high-payout RNG wins. Evolution has paid close attention to visuals and audio 64 GAMINGAMERICA

luck, a Grand Wheel coin on reel 4 that could award the Grand. Free Spins are played with reel #1 entirely Wild, and on top of this, reels can suddenly expand to reach colossal heights and trigger awards with up to 4,608 ways to win. These larger-than-life dragons that appear throughout the game’s iconography have been specifically designed to be eye-catching and appealing as they release bonuses for players to claim and enjoy. Speaking on its identity as a company, Bluberi states: “We share one common goal: bringing our love of gaming to life. With differing backgrounds, unique perspectives and a multitude of talents, both in and out of the office, we let our diversity influence our authentic approach towards creating impactful gaming experiences."

here, with eye-catching design in both departments. Todd Haushalter, Chief Product Officer at Evolution, noted: “It’s high time that we brought our Lightning brand to the player favorite Blackjack. We’ve been very careful to preserve the true essence of Blackjack, while adding extra layers of excitement with added Lightning multipliers. The end result is a beautiful game that gives players the opportunity to have enhanced payouts while still playing the game the way it was originally intended.”

PRODUCT REVIEWS

CRYSTAL CAVERNS MEGAWAYS™ Step into an icy wonderland full to the brim with glistening icicles and precious gems in Crystal Caverns Megaways™ slot played on a Megaways grid! Gold Wild symbols land on reels 2, 3, 4, 5 and 6 and can replace all the other symbols, apart from the Scatter. And this is not even the best part! If a Wild hits anywhere on the reels (but on the top row), it will expand, covering the whole reel and helping you create even more shiny combos! The Tumble Feature is also part of the gameplay, doing what it knows best: replace the

symbols part of a winning line with new ones. However, in this slot, the Tumble Feature comes with an unexpected twist: an increasing multiplier that applies to the total win of the tumble! As for the Scatter, not only do they pay out up to 100x the total bet, but they can also award up to 20 Free Spins with a multiplier that increases with every tumble. If Crystal Caverns Megaways™ isn’t a multiplier madness, we don’t know what is!

GODS OF KEMET

land anywhere on the reels, it awards 8, 12 or 15 Free Spins respectively. Next, during the Free Spins, reels 2, 3 and 4 combine and spin together as a giant reel with Big Block symbols on it. Three more Free Spins are awarded when the scatter symbol appears as a Big Block Symbol. When 6 or more Fire Ball symbols appear anywhere on the reels, it awards the Fire Ball feature. The Fire Ball symbols have credit prizes on them that are a multiplier value of 0.8x to 100x the total bet or a Super Bonus prize. Pariplay’s Wizard Games aims to combine time-tested recipes with innovative ideas and deliver the most value-driven iGaming experiences for regulated markets around the world. Offering a suite of 120+ casino games, it creates and adapts its tools and content according to players’ preferences and clients’ business objectives.

Gods of Kemet by Wizard Games takes you on the journey of a lifetime. The Egyptians called their country Kemet, literally the “Black Land” coming from the color of the rich and fertile black soil. The advanced Kemet civilization is renowned for its extraordinary monuments, tombs, temples and artwork that celebrate life. Step back in time to be rewarded with riches! Gods of Kemet is a rewarding 5-reel, 3-row slot that will have you spellbound from the first spin. This is one adventure you don’t want to miss out on! There are some key features of the product. For instance, when any of the paying symbols land on the center position of Reel 3, it transforms into a 3x3 Big Block Symbol on reels 2, 3 and 4. When 3, 4 or 5 Scatter symbols

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PRODUCT REVIEWS

FLEXIA: CASHLESS FOR THE NEXT GENERATION OF GAMING Flexia is transforming the customer experience by empowering a true cashless solution for the gaming industry. The customizable, fully integrated Flexia Cashless Solution combines multiple accounts – casino and online gaming, casino loyalty program and a Mastercard account – in a single mobile solution, providing players the flexibility to fund and use their gaming accounts, and enabling customers to earn loyalty points for spending outside the casino. The entire process is seamless and simple, from player onboarding to funding through to cash-out. Fully integrated into the casino’s CMS, Flexia’s robust platform controls instant account activation and card issuance (digital and/or physical) at the casino, general account management functions, connectivity with financial networks for funding and cash-outs, KYC/AML tools and monitoring. The Flexia team works closely with the casino operator to tailor the solution to 66 GAMINGAMERICA

existing systems and the casino’s needs. The Flexia App lets players instantly load funds directly from their bank account, debit card or other e-wallets and seamlessly transfer funds between their digital wallet, gaming accounts, and favorite game without ever leaving the gaming floor. The mobile app makes it simple for players to cash out of their gaming account and to easily access their funds in the digital wallet for use at retail, restaurants or at ATMs. In addition, players earn casino loyalty points from casino play and Mastercard and spend both inside and outside the casino, allowing customers to achieve VIP loyalty status faster and access unique, member-only promotional benefits customized to their preferences and spending habits. One of the many benefits of Flexia’s Cashless Solution is that it enables operators to better understand their players’ behaviors on and off their properties, thus allowing the casino to customize player accounts with dynamic features and functionality driven by account profile, loyalty program level or other parameters set by the gaming operator.