DIFFERING VIEWPOINTS

THE COMMERCIAL PERSPECTIVE

What is the best way for a tribe to integrate with the fast-evolving commercial market? Gaming America sat down with David Bretnitz, Kambi’s Senior Director of Sales in the US, to get his views.

How are tribal operators responding to the ever-growing influence of commercial operators across the country?

Tribal gaming has been an integral part of the wider US casino landscape since the Indian Gaming Regulatory Act was passed in 1988, with revenue growing year-on-year for the last decade and now accounting for approximately 45% of all gaming takings. Even with the pandemic, collective gross gaming revenue from tribes was still $27.8bn in 2020, which shows that the tribal gaming market remains robust. Since the repeal of PASPA in 2018, sports betting has exploded across the US and tribal operators across the country have been assessing the best way to introduce this new vertical to the benefit of their community.

With that in mind, what opportunities can commercial brands present to longstanding tribal operators?

Tribes effectively have two options when it comes to launching a sports betting operation: they can either partner with a B2B supplier or they can work with an established B2C sports betting brand. Selecting the right route to market is crucial, but it’s important to stress that neither option is right or wrong. For some tribal operators, partnering with a B2C company with national brand recognition could be the most effective strategy as they can then leave the day-to-day management of the sportsbook to their partner and have a shared database. However, this does mean tribes lose out on potential cross-sell opportunities at their casino. As well, they have to pay a far larger revenue share compared to B2B. Having said that, introducing a new product vertical on property isn’t a light undertaking. By working with an established B2C brand, tribal gaming operators are in a position to benefit from the experienced sportsbook marketing and operational expertise of the operator.

"SELECTING THE RIGHT ROUTE TO MARKET IS CRUCIAL, BUT IT'S IMPORTANT TO STRESS NEITHER IS RIGHT OR WRONG."

Conversely, how do you think tribal operators can compete with these commercial giants?

At Kambi, we believe the strength of the sportsbook product itself will ultimately be the determining factor for success in the US market, including tribes. However, operating a high-performance sportsbook is a huge challenge on a structural and technical level, and few operators are in a position to build their own technology and platform. We understand the value tribes place in long-term thinking and trusted partnerships. By working with an end-to-end B2B sportsbook partner, tribes can most effectively compete with these commercial giants.

Partnering with a specialist B2B sportsbook is an attractive option for those tribal operators that have confidence in the strength of their brand and want to maintain full control of their customer database. Tribal operators including Seneca Gaming Corporation, Four Winds Casinos and Desert Diamond Casinos have launched sportsbooks in partnership with Kambi.

How will the new legalization of sports betting in New York affect the state’s tribal operators?

Since going live in early January, New York State has become the biggest online sports betting market in the country, and there are some eye-watering figures being initially reported. However, much of this growth is being driven by extremely generous bonuses and sign-up offers. This includes what impact it will have on tribal operators in the state. However, Kambi believes the operators most likely to succeed in the long term will be those that have a high-performance sportsbook product.

THE INDIGENOUS PERSPECTIVE

We spoke with Chief Mike Delisle of the Mohawk Council of Kahnawà:ke, to discuss the current state of Indigenous gaming in Canada, specifically examining the soon-to-launch iGaming and single-event sports betting markets in Ontario.

How are Indigenous operators responding to the ever-growing influence of commercial operators across the country?

To be honest, there aren’t a lot of Indigenous operators in Canada presently. The Kahnawà:ke started as a regulatory body, the Kahnawà:ke Gaming Commission, 21 years ago now and only in the last six to seven years have we become an operator through a partnership with Sports Interaction. I’ll put it this way, normally Indigenous people aren’t trusting of government,

"WE ARE NOT PIRATES, WE WANT TO BE RESPECTED AS INDIGENOUS OPERATORS."

and sometimes each other, and it can be difficult to put forward a uniform position in terms of how we are impacted. Overall, in 1985 when the Federal Government amended the Constitution, basically eliminating Indigenous communities from being involved in the gaming business and delegating it to the provinces, this is the major concern for us today moving forward. There have been attempts in the past for us to engage with the Minister of Justice, who sent a letter to everyone in Indigenous territories in June of last year, asking for dialogue about the reopening of the 1985 agreement. We said we would absolutely like this and have since received no response. It is frustrating.

With that in mind, can commercial brands present opportunities for Indigenous operators? For example, your partnership with Entain?

In regards to Entain, we would like them to become our big brother in the province of Ontario where they will be applying for a license. They know full well that our platform, Mohawk Online, will not be succumbing to Canada’s recent legislation nor will we pay taxes. For us, it’s very different in how we approach things and we have asked the Ministry of Finance for a fair shake. We want a carveout, a way forward or recognition of our regulatory body. This is the angle we are taking and we are building a consensus of other Indigenous communities in Ontario. We are spearheading this and many others are looking for change.

Conversely, how do you think Indigenous operators can compete with these commercial giants?

We know that these relationships can be an advantage. There are obviously negatives when large corporate bodies move in, but we view our partnership with Entain as a positive in terms of them understanding our current fight, engaging with us to be able to have Ontario and other provinces understand. Ultimately, I think Ontario is the tip of the iceberg; once Ontario launches, other provinces will follow. It’s a money grab. But again, we view Entain as a positive partner, we meet with them often and they are on board with our vision.

How will the new legalization of single-event sports betting in Ontario affect the provinces Indigenous operators?

It will shut us down. Mohawk online will not be able to operate according to the new regulations in Ontario and if we acquiesce to everything they put in place, the taxation and the new rules, it will not allow us to engage with players or to advertise in our markets. However, we have good relationships with a number of larger bodies in Canada and they are beginning to understand this problem. We are still looking to talk with the Ontario Government to see if we can engage and take action, take the steps to ensure that Indigenous space is respected. We have been involved in gaming for over 20 years and we have never been challenged, federally, provincially or internationally. We are not pirates, we want to be respected as Indigenous operators and continue to generate revenue for our people.